Idaho lawmakers set a budget for the Idaho State Tax Commission that would end unpaid furloughs for all of its staff but slow the hiring of new temporary tax auditors. Lawmakers and commission leaders say the change in priorities should help auditors continue to close the gap of unpaid taxes that Idahoans should be paying the state.
“We’re trying to keep our effective and trained people working as hard as they can to minimize that tax gap,” said tax commission chairman Bob Geddes, the former Idaho Senate leader. Geddes agreed with the budget set by lawmakers.
All tax commission staff are taking six unpaid furlough days in the current budget year, matching a tactic from other state agencies to reduce costs without laying off workers. Those furloughs are contributing to a drop in tax collections, but the changes in the next budget are expected to lead to a surplus of almost $20 million in the next budget. That additional money could go to support public school, though lawmakers have yet to make decisions on school spending.
The tax commission would see a $2.8 million budget increase to $34.9 million in the next budget year, which starts in July. Auditors and other staff would be expected to bring in an additional $19.7 million in tax revenues.
Rep. Darrell Bolz, R-Caldwell, called the increased spending a good investment, given the return of extra tax collections. Lawmakers on the Joint Finance-Appropriations Committee (JFAC) approved the budget on a unanimous 20-0 vote.
The budget would also make 48 temporary tax auditors hired during the current budget year permanent employees and add 22 new temporary auditors, which is down from the original plan of 48 new workers. The extra auditors are part of a plan to narrow the gap of uncollected taxes, and the auditors must meet performance goals, showing they are bringing in tax dollars while keeping their expenses low.
Geddes said not hiring the new auditors could make collections more cost-effective. “It helps us to be more efficient, because our current auditors would be the ones to train new auditors,” he said. The commission was also looking into renting new office space in Canyon County to give those new auditors a place to work, but that is no longer necessary.
The current new auditors have already collected an additional $15 million, which beats their goal of getting $11.4 million by the end of June. However, regular tax staff were $21 million behind their collections at the end of February. Furloughs contributed to that shortfall, as did a problem with the commission’s phone system, which went down in December for two weeks. The budget includes $275,600 for the commission to lease a new phone system.
With the extra $19.7 million expected in collections, lawmakers would have a $13 million surplus in the next general fund budget. Geddes said it wouldn’t be typical for lawmakers to spend that money and that the surplus could easily be wiped out if the $2.4 billion in projected tax revenues dips even slightly.
Sen. Dean Cameron, R-Rupert, said he and Rep. Maxine Bell, R-Jerome, the co-chairs of JFAC, both support putting that money into public schools. Spending for public schools, which makes up more than half of the general fund, has yet to be set by JFAC. Cameron said it’s up to lawmakers, not the tax commission, to set spending on state tax dollars.