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Law to transition Idaho to statewide public defense system will provide some property tax relief, but not much


A new law passed this year means the state will start picking up the tab from local governments to cover the cost of public criminal defense to provide property tax relief. But, it’s unknown exactly how much of a break it will bring to taxpayers. 

House Bill 735, brought by House Majority Leader Mike Moyle, R-Star, and Rep. Jon Weber, R-Rexburg, will repeal the Charity and Indigent Fund Levy from all of Idaho’s county tax rolls and replaces what they spent on public defense costs with state funds. This will cost the state $34 million in the upcoming two fiscal years, which will come out of the general fund and its record-breaking surplus. 

[Dead or alive: How did bills on housing, growth and property taxes fare in the 2022 legislative session?]

This bill creates a trade where counties agree to permanently decrease the amount they can tax residents in exchange for transitioning to a state-funded public defense system, instead of relying on a patchwork of funding that varies county by county. The bill was backed by both the Association of Idaho Cities and the Idaho Association of Counties. 

Starting in 2025, $36 million in sales tax funds that would have otherwise gone to counties will be put into a Public Defense Fund. This will combine with the $11.7 million already appropriated for the Public Defense Commission to fund the defense statewide.

The state legislature’s move toward a centralized system comes after the American Civil Liberties Union of Idaho successfully sued the state in 2015 alleging Idaho’s public defense system is unconstitutional. The Idaho Supreme Court sided with the ACLU unanimously last fall. 

Experts predict minimal property tax relief 

It will provide a roughly five to six percent property tax reduction throughout the state. Ada County Clerk Phil McGrane said property owners shouldn’t get their hopes up though. He said the bill would eliminate the last of the county’s indigent program, but this has been slowly being phased out since Medicaid expansion passed in 2018. This means that even though the county will realize some savings from having the state fund criminal defense, he doesn’t expect it to be a major windfall. 

“It will be a few million dollars, but when you distribute that across Ada County it’s like ‘Here’s a few bucks’,” McGrane told BoiseDev. 

In comparison, Ada County cut $8 million from its budget last year and it saved the average homeowner from having their taxes increased $29.50. Most homeowners still saw a hike on their bill due to rapidly rising residential assessments and the ongoing shift of tax burden onto residential property. 

Kirsten Pochop, a policy analyst with the Idaho Center for Fiscal Policy, said her analysis turned up the same conclusion. She said the relatively small amount of the cut spread across all payers won’t do much to bring relief to those most struggling to make their payments. 

“One of the things that legislators have been hearing about from specific constituents is how they were struggling with property taxes, but those were generally lower-income folks, seniors and those on fixed incomes,” Pochop said. “This property tax bill is an across-the-board cut so it doesn’t really target those who need it the most.”

Unanswered questions 

There are still a lot of questions about what this will look like in practice. 

Pochop said in her research on the bill she learned the Idaho State Tax Commission is still working to determine how much money each county spent on their indigent program and public defense to see how much their payout will be. She said some counties, like Kootenai, have not been collecting the Charity and Indigent Fund levy to help cover their costs for these programs, making it difficult to determine exactly how much it costs those localities. 

“(The Idaho State Tax Commission has) their work cut out from them to come up with these figures,” she said. “I imagine that is going to be quite a heavy lift for them.”

McGrane said Ada County is still puzzling over various aspects of how the change will be implemented as well. While Idaho’s rural counties have overwhelmingly supported a state system because it will give them more resources, he said Ada County has preferred to keep its public defense system under the management of the county due to the large size of the department. 

There have also been questions about how the final closeout of the indigent program will work. This county function, which helps pay the medical bills of low-income Idahoans who cannot pay, has been slowly phasing out since Medicaid expansion passed in 2018. McGrane said the county has been meeting in recent weeks to puzzle out which part of the office will completely shut down and what will stay as things evolve. 

“In all honestly we’re still working through the implications of the bill,” he said. 

Margaret Carmel - BoiseDev Sr. Reporter
Margaret Carmel - BoiseDev Sr. Reporter
Margaret Carmel is a BoiseDev reporter focused on the City of Boise, housing, homelessness and growth. Contact her at [email protected] or by phone at (757)705-8066.

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