For most of his first eight years in office, Gov. Butch Otter has used his online newsletters to shed the best light on a sorry economy.
“Prudent budgeting” and “conservative fiscal management” were buzz phrases to mask what was really going on – which were deep cuts in education and the substantial dismantling of state government.
The latest edition of his newsletter, which bubbles with optimism, paints a far different picture. Maybe the state’s song should be changed to “Happy Days Are Here Again.”
Otter again mentions “prudent budgeting” and “conservative fiscal management,” but in a different context. Those elements, along with a business friendly environment, “have Idaho doing very well financially,” he said.
Rep. Tom Loertscher of Bone, in a recent newsletter to constituents, describes a conversation with the governor that says it all.
“Tom, we have the money,” Otter told Loertscher.
And that’s what drives the conservative base batty. Fiscal hawks know what to do when businesses close, unemployment skyrockets and foreclosures go up. They dial down state government, while taking an axe to education budgets and health service programs. Seven years ago, the tight-fisted Legislature refused to grant a two-cent road tax for crumbling roads – as if a two-cent tax would drive people to the poor house.
According to the governor, all that gloom and doom is in the past. As outlined in his newsletter, he’s proposing a 7.9 percent increase for public schools, a 9.6 percent increase for community colleges and an 8.8 percent increase for universities. His grand plans include a four-year tuition lock and a full-fledged community college in Idaho Falls.
Otter says he hasn’t given a moment’s thought about his legacy, but this budget is how legacies are built. I imagine Otter would rather be seen as an “education champion” than the only Idaho governor in modern history to blow up education budgets.
Of course, not everyone is on board with the governor’s budget, including Loertscher, one of the Legislature’s most fiscally conservative members. He warns that while revenues are up today, “reversals can happen very fast.”
House Majority Leader Mike Moyle of Star agrees. He notes that businesses fail because of what they do during the good times, not the bad. Spending too much during the good years can lead to problems. Moyle has seen enough holdbacks to realize the same principle applies to state government.
Moyle gives measured support for Otter’s education proposals, which is more than House Majority Caucus Chairman John Vander Woude of Nampa offers.
“I thought he had a nice Christmas tree, and he put a lot of decorations on it,” Vander Woude said of Otter’s message. “The money he is talking about spending is way over the top. There will be pushback all the way around.”
Rep. Maxine Bell, co-chair of the Joint Finance-Appropriations Committee that ultimately will make most of the budget decisions, told the Idaho Statesman’s Bill Roberts that she was skeptical about Otter’s call for a four-year lock on tuition. Rep. Janet Trujillo of Idaho Falls, vice chair of the Revenue and Taxation Committee, says she’d like to see more tax relief than the governor’s wish list. With Moyle on the same committee, she might get her wish. He says tax relief should have been a bigger part of Otter’s message.
“My thought is that a third of the money should go to education, a third should go to tax relief and a third should go to everything else,” Moyle said. “The money you put back into the economy is not stagnant; it rolls.”
Moyle, in his ninth term, has spent his political career fighting for tax relief. He says Idaho’s tax system is “out of whack” compared to other states.
“If people lived in Washington, they would pay absolutely no income tax and almost the same sales tax,” Moyle said. ”If they lived in Nevada, there’s no income tax. In Oregon or Montana, there’s no sales tax. And, by the way, all those states have lower income tax rates, other than Oregon. But to be in Oregon’s upper rate, you’ve got to be at $250,000 in adjusted income. In Idaho, it’s $10,800.”
Moyle thinks the Legislature will find a balance that gives more back to the taxpayers, while making appropriate investments in education.
So, the governor’s budget was not dead on arrival in the Legislature. But at the moment, it is on life support.