Idaho Bills

Amends and adds to existing law to provide for an initiative petition to raise or lower the property tax budgets for fire protection districts and ambulance service districts and to revise provisions regarding certain property tax budget limits.

RS33842C1 / H0959 This legislation addresses the limitations HB 389 (2021) places on the growth of property taxes for fire protection districts and ambulance service districts. These constraints have prevented these districts in a small number of fast-growing areas from being able to keep up with the public safety service demands of their growing populations. Specifically, this legislation: 1. Increases the cap on overall property tax growth fire protection districts and ambulance service districts from 8% to 15%, if enough new construction and annexed territory has been added to cover the cost of these extra property taxes. 2. Provides that new construction and annexations are added to property tax budgets of fire protection districts and ambulance service districts based on the prior year’s levy rate, rather than the estimated current year levy rate. 3. Prohibits the accumulation of additional future foregone property tax balances in fire protection and ambulance service districts. Foregone property tax balances from prior to 2026 may continue to be retained and used in the future, under statutory limitations. 4. Provides a new voter initiative process for fire protection districts and ambulance service districts that would allow voters to increase or reduce property tax budgets, using the same threshold for passage that the law currently provides for voters to increase property taxes beyond statutory limits (two-thirds vote).

Amends and adds to existing law to expand the homestead property tax exemption, to increase the sales tax rate, and to direct sales tax revenue to taxing districts to replace property tax revenue lost from the homestead exemption expansion.

RS33792 / H0961 This legislation would eliminate all property taxes on a person’s primary place of residence forever. It would not affect any other property, nor would it allow property taxes to increase on other nonresident properties. The lack of property taxes would have a fiscal impact. Please see the

Amends existing law to revise a sales tax exemption for data center equipment and to revise a certain property tax exemption for certain capital investments.

This legislation amends the sales tax exemption for data centers in six key ways. This legislation does the following: 1) adds two additional criteria for qualification for the exemption related to energy and water consumption, 2) narrows the original sales tax exemption to only be applicable to the internal servers, 3) prohibits data centers constructed after April 1, 2026 that opt-in to the sales tax exemption from also claiming the property tax abatement in 63-4502, 4) allows for the sales tax exemption to only be available for 20 years for each project, 5) requires the tax commission to report annually on the approximate amount of sales tax revenue not collected as a result of this policy, and 6) requires the tax commission to submit a report every 5 years to the legislature with an analysis of the effects of the exemption and data centers on Idaho’s economy, energy resources, and water resources. This legislation provides that data center projects currently under construction may continue with the sales tax exemption provisions (construction materials and internal server equipment) as originally provided when 63-3622VV was enacted in 2020; however, the new 20-year provision will apply to those projects currently under construction.

Amends existing law to revise provisions regarding the homestead property tax exemption.

RS33659 / H0885 This legislation clarifies who qualifies for the homestead exemption. Homeowners can't claim this exemption if they have a similar exemption in another state. Their Idaho license or I.D. must show the same address as the property they're claiming. Homeowners can also use an individual Idaho tax return for verification if it shows the same address. To maintain the exemption, they must also live in Idaho at least six months a year, unless they're serving in the military or on a religious mission. If a homeowner runs for office, their homestead address will qualify as their candidate residence address.

Amends, repeals, and adds to existing law to establish a state property tax and to provide certain exemptions to such tax.

RS33664 / H0886 This legislation establishes a state property tax to fund Idaho’s public safety infrastructure, provide primary property tax relief, and support local infrastructure. To accomplish this goal, the legislation provides an exemption for personal property, operating property, forest land, mineral/mining development, homestead property, real property (i.e., commercial, industrial, agriculture), any residential property owned by an individual holding an Idaho homestead exemption, and residential property occupied by a long-term tenant on at least a seven-month lease. The tax rate is 2.5 mills on each dollar of taxable value, which equals $0.25 per $100. The funds are collected at the county level, and the state redistributes 100% of the collected funds back to the respective counties and cities where the tax was collected. First, 50% of the collected funds will be returned to the counties to fund law enforcement, fire protection, and emergency medical services. Second, 30% of the collected funds will be returned to the county as a flat property tax deduction for homeowners with a homestead exemption. Finally, the remaining 20% of the collected funds is directed toward infrastructure, capital expenditures, and maintenance.

Amends existing law to revise a sales tax exemption for data center equipment and to revise a property tax exemption for certain capital investments.

This legislation amends the sales tax exemption for data centers in four key ways: 1) adds two additional criteria for qualification for the exemption related to energy and water consumption, 2) narrows the original sales tax exemption to only be applicable to the internal servers, 3) prohibits data centers that opt-in to the sales tax exemption from also claiming the property tax exemption in 63-4502, and 4) adds a sunset date of July 1, 2036 to this sales tax exemption in order to allow for an analysis of the effects of the exemption and data centers on Idaho’s economy, energy resources, and water resources.