Reclaim Idaho has been on a roll. In 2018 the group was the key driver in passing Medicaid expansion. They fiercely opposed legislative efforts to impose new hurdles to placing future measures on the ballot. Their stance was bolstered by Gov. Brad Little’s veto of the restrictions. And, they have drawn substantial attention for their town hall forums on the appropriateness of Idaho’s current ballot access procedures.
But Reclaim Idaho made a massive unforced error last week with the rollout of its “Invest in Idaho” initiative that they hope to put on the ballot in 2020. The proposal would raise the Idaho income tax rate by 3% for those making more than $250,000 as an individual or over $500,000 for a married couple. It would also boost Idaho’s corporate tax rate by a bit over a full percent.
The group believes that will raise $170 million a year and the measure directs that sum towards Idaho’s public schools. The money is to be used to 1) reduce class size, 2) retain and attract teacher and support staff by raising salaries, providing continuing education and aid to new teachers, 3) provide classroom supplies and textbooks, 4) boost career technical education, 5) provide full day kindergarten, 6) expand music, art and drama programs, and 7) support special education.
Rebecca Schroeder, Reclaim Idaho Executive Director, said: “We want to level the playing field for all Idahoans so that every boy and girl, no matter where they live, have a fair shot at success in this state.”
As part of its initial news release the group asserted that recent corporate tax reductions have mostly benefited out-of-Idaho shareholders, citing a study from Idaho Center for Fiscal Policy.
This entire effort is a serious mistake.
First, this measure will be perceived as intensely partisan. It is difficult to see many Idaho Republicans embracing the cause. Many Democrats and Idaho teachers will probably be on board. Reclaim Idaho in 2018 forged a bipartisan coalition including former GOP legislators. Their town halls have featured former Republican Attorney General Jim Jones. Reclaim Idaho’s credibility as bipartisan group is likely out the window.
Second, Idaho’s heavily Republican Legislature will probably react sharply. I suspect this proposal, combined with the existing medical marijuana and minimum wage initiatives, will increase the probability that high hurdles to ballot access will pass next year. Will Gov. Little yet again issue a veto? If tough ballot requirements become law, few future law changes will make the ballot.
Third, Reclaim Idaho attracted major business support for Medicaid expansion. How many Idaho businesses will be there in 2020 for a boost in the corporate tax rate?
Fourth, this measure will struggle to pass. I expect significant organized opposition. It will be cast as a Democratic measure in a Republican state. Opponents will argue the list of education spending will merely “throw money” at a multitude of targets, resulting in minimal effect.
But, the real problem is that 2020 is a presidential year that will drive partisans to their respective corners. The news cycle will be dominated by Trump versus Biden, Sanders, Warren, Harris, etc. Idaho is a solidly Republican state. Does anyone think that a presidential year is the environment to prevail on a tax increase measure here?
Idaho’s agricultural sector is already struggling. Manufacturing is tipping down. The trade wars are hurting Idaho companies like Micron, in addition to farmers. There are emerging signs that an economic slowdown is ahead. If so, how likely are Idaho voters to raise taxes if a recession is on the way or, even, here?
Reclaim Idaho should seriously consider withdrawing their “Invest in Idaho” initiative.