State of the State and Oops! You May Have a Tax Bill

January 11, 2019

"Every man, every woman who has to take up the service of government, must ask themselves two questions: 'Do I love my people in order to serve them better? Am I humble and do I listen to everybody... in order to choose the best path?' If you don't ask those questions, your governance will not be good." -

Pope Francis

Greetings from the first week of the 2019 Legislative Session! This week Governor Little gave his inaugural

State of the State address which talked about important issues such as the economy, education, Medicaid Expansion, and corrections. These priorities are either constitutionally or statutorily obligated to budget. Governor Little's proposed policy agenda has been our priority for some time, and we look forward to collaborating to create positive changes for Idahoans.

Economy

In 2018, the Legislature conformed to the new Federal Tax Code and then passed a tax cut that would change how Idahoans claim deductions. On April 15th you may possibly have a tax bill rather than a refund. The Idaho State Tax Commission failed to effectively notify Idahoans to update their W-4s which tells employers how much to withhold from an employee's paycheck. The Tax Commission estimates that 75 percent of taxpayers have not adjusted their withholdings for the new tax laws. As an example, a married couple who are both working and filing jointly, could have a $700 tax bill. Less deductions and the elimination of certain exemptions, such as dependents, could result in an even larger tax bill. We cannot avoid this issue for 2019, but if you would like to change your W-4 for 2020, you can find more information here.  

Education

In his State of the State address, Governor Little asserted his number one priority is education and I agree. A strong education system promotes lifelong learning that helps ensure our workforce is the best and brightest Idaho has to offer. Governor Little mentioned budget increases for schools, teacher salaries, full-day kindergarten, and starting a Children's Cabinet - focused on a variety of environmental conditions that may hinder student learning. Investing in full-day kindergarten is a big step for Idaho in terms of setting our children up for success, but early childhood education (pre-K) is also important. Studies show that kids who go through pre-K earn more money than those who don't, are more likely to go to college, and less likely to wind up in jail.  The governor wants to point Idaho in the right direction on this issue and I am eager to work with him and the rest of the Legislature this session to improve the future of our children and our workforce.

Medicaid Expansion

The most important priority this legislative session is to implement and fully fund Medicaid Expansion, as Idahoans overwhelmingly voted for it this past November. The Legislature should honor the will of the people and the people want a clear, clean Expansion. The Governor's office has found the money to fully fund Medicaid for the first year and after that, the savings from expanding Medicaid will pay for it. However, the funding in the Governor's budget does not account for any additional expensive and bureaucratic conditions such as work requirements. Not only does Medicaid Expansion cover the uninsured with health care, but it will bring back 400 million in tax dollars which can be put back into our local and county governments as well as our hospitals, doctors, and other medical staff. I am hopeful the Legislature will work to implement, and fund Medicaid, as is, in 2019.

Corrections

The Governor's budget recommendation takes on the challenge of increasing prison capacity and the resources needed to reduce the flow of inmates into our prisons. Idaho has the largest percentage of nonviolent offenders in our prisons resulting in our state having transferred 1,000 inmates to Texas because of overcrowding. There is an urgency to change how we deal with at- risk populations, review mandatory minimums, and better treatments for drug addiction and mental health problems. Current practices are expensive, unsustainable, and often too late. Also, we are constitutionally required to improve our public defender system.