A new way to pay for our roads?...

We have passed a bill out of the House that has the potential to add a very valuable tool to the State's toolbox of items available to them to pay for our infrastructure. Besides taxes and fees, we have the ability for ITD to "earn" some of the funds they need without competing with business. A reporter from the Lewiston Tribune seemed to be one of the first to understand the potential, he writes:

BOISE - Last November, about the time Congress switched from billion-dollar to trillion-dollar bailouts, one of the more intelligent government money-making operations in recent years came to an end.
That was when, with minimum fanfare, the last of the 50 state quarters hit the market.
I don't know who dreamed up that project, but it was one of those ideas that makes you smack your forehead and wonder why nobody thought of it earlier. It was brilliant in its simplicity: Produce 50 new quarters honoring each of the 50 states, roll them out over a 10-year period, then stand back as coin collectors go into a numismatic feeding frenzy.
Before the program began in 1999, the U.S. Mint produced about 1.5 billion quarters per year. Since then, according to the Congressional Budget Office, production has more than doubled, to an average of 3.5 billion per year - an increase worth about $350 million in annual net profits, or $3.5 billion over the life of the program.
The project was such a hit, the mint plans to follow it up this year with quarters honoring the District of Columbia and five American territories (Puerto Rico, Guam, American Samoa, the U.S. Virgin Islands and the Northern Marianas Islands). A decade-long project featuring quarters for various national parks will begin in 2010.
That kind of aggressive pursuit of market opportunities isn't typical of state or federal governments - for good reason. One wouldn't want monopolistic taxing entities, for example, to be influenced by profit motives.
However, the state quarters project demonstrates capitalism and government can occasionally combine to benefit taxpayers.
Rep. Marv Hagedorn, R-Meridian, is hoping to create a similar opportunity for Idaho.
Hagedorn, 53, grew up on a farm near Moscow. His folks and a sister still live in the area. He graduated from Potlatch High School, but it was working for the Potlatch Corp. lumber mill that changed his life.
"That's what made me decide to join the Navy," he said. "I was working the line next to guys who were missing two or three fingers, and the highlight of the night was when we'd throw knots at each other. I told myself I had to go somewhere."
Hagedorn retired in 1994, after 20 years in the service. Now, during his second term in the Legislature, he's hoping to turn Idaho into the U.S. Mint of commercial truck license plates.
Unlike personal vehicles, commercial trucks and tractor-trailers can be licensed and registered in any state, regardless of where a company is based. That, to Hagedorn, creates a marketing opportunity. He introduced a bill earlier this session that would encourage trucking firms to register their fleets here.
"I've been working on this for a few years," he said. "My objective is to find a resource the state has that would help relieve the tax burden on citizens, without competing with private businesses - and this is a great opportunity."
Idaho already offers a permanent plate that doesn't require yearly registration renewals. For a company like Wal-Mart, which has more than 50,000 tractor-trailers, eliminating paperwork and the need to match specific trailers with specific renewal stickers represents a substantial cost-savings, Hagedorn said.
Idaho law, however, currently requires out-of-state truckers to pay sales tax on the price of the trailer before they can buy the permanent plate. That makes it cost-prohibitive.
Hagedorn's bill would remove the sales tax requirement. Moreover, it authorizes the creation of special "business logo" license plates - meaning Wal-Mart or UPS or any other company could design their own plates, complete with corporate logo and marketing slogan.
"Everyone is looking to save a buck," Hagedorn said. "We can make this simple for corporations and help save them money just by changing state law. It costs $3 to make a license plate, and we'd sell them for $112. There are 5.6 million semi-trailers in the United States. That's a $627 million market."
Add in Canadian trucks, he said, and the market potential climbs to $1 billion.
"Imagine if we get just 10 percent of that," Hagedorn said. "In the past, we've looked at taxpayers within our border (to generate state revenue). This could bring in revenue from outside the state. There are opportunities out there. We just need to find them."
Hagedorn's bill is scheduled for a floor vote in the House this morning. If approved, it will move on to the Senate.

House bill H226 is now awaiting scheduling to be heard in the Senate Transportation Committee. It went through the House State Affairs and Transportation and Defense Committees as well as the House floor with out a single "nay" vote. I believe this is a great tool and could bring in millions that could off-set taxes we now pay.

Your thoughts?

Roads and Your $$$$...

I've talked before about how our Highway Distribution Account (HDA) works and the taxes we pay that go into it, fuel and registration taxes. The Federal fuel taxes also flow into our HDA that we use to take care of our road, air and rail transportation infrastructure.

I used to believe that all taxes went into a big bucket and were doled out by the politicians based on their power and who they needed to get votes from... I've had a lot of tax education from those days and know that's not the case. In Idaho, most taxes are user fees related to the use of the infrastructure involved in that activity.

There are no general fund taxes used for transportation. General funds come from sales tax, individual income tax (these two alone comprise about 90% of state general funds), corporate tax and other misc fees. These General funds are then spread out over Health and Welfare, Education (K-12 and Higher Ed), Corrections, Veterans Services... the list goes on. They are not used for the Department of Fish and Game or the Department of Transportation, these two departments use only what are called "dedicated funds" that come from user fees or taxes and federal funds based upon user fees or taxes.

Because of the reduction in sales taxes and personal income, revenue for the General fund is down, thus funds available for those departments will also be down, their budgets reduced.

The Department of Transportation has experienced inflation costs with building materials over many years without us addressing their revenue stream (fuel taxes and registration fees). We requested a Performance Audit last year that revealed some things that the department and the legislature needed to do in order to ensure we got the biggest bang for the buck in the future.

We do need to make some adjustments in the revenue provided to ITD so that they can better plan maintenance and preservation activities as well as do those activities. They are currently in the mode of fixing "worst first" and not doing preventive maintenance due to the lack of funding available. They do not have a preventive maintenance planning program for our roads that went by the wayside when getting a new financial software system. They need some new software tools to be able to better schedule and perform preventive work instead of being reactive only to work as our infrastructure fails.

Now the big question: How much do they need? There are quite a few numbers being kicked around and how to create that revenue from various forms of increased fees and taxes. Some of those forms take 5 years to implement, some only 1 year. We have heard from a number of lobbyist's, the Governor's office and, of course ITD on the issue, but we've only heard from one... yes just one citizen on the issue in committee. Mr Hart, a precinct chairman in District 19 took the time yesterday to testify before the committee about what he is hearing from the folks in his precinct. That was refreshing and needed.

Of course we get emails and phone calls from citizens saying to invest in the infrastructure and to raise no taxes at all...

I would love to hear from you as would all of the members of the Transportation and Defense Committee in the House. Let us know your thoughts and how you feel we should best proceed. This infrastructure belongs to you, you pay for it's upkeep and for the people that do that upkeep... how would you proceed?

Let us hear from you.

Meridian Election March 3rd!!!

I just received an email from one of our Meridian neighbors asking me about the school bond election on March 3rd. I had to say, I had no idea that there was going to be a bond election and needed to do some research.

Below is the announcement of the Levy Election that will be held a week from today. I do not know how else this has been published, but thought it would be good to let my readers know. I would suggest that if you have questions, call the District offices at 855-4500.

This from the Meridian District 2 Web Site:

Supplemental Levy Election March 3, 2009

The district will be holding a supplemental levy election Tuesday, March 3, 2009.

The levy will ask voters whether or not to give the Board of Trustees authority to raise up to $10 million per year for each of the next two years.

Supplemental levies must be approved by the voters every two years. The current supplemental levy, which also raises $10 million per year, is set to expire this year.

Revenue generated by the supplemental levy must be used for district operations like staffing, teaching materials, etc. Unlike a plant facility levy or bond levy, supplemental levy revenue cannot be used for building construction.

The levy rate that provides local support for Meridian District Schools will remain the same if voters approve the proposed supplemental levy.

All schools will be polling places, and voters living in Joint School District No. 2 can vote at any polling place. Unregistered voters can register at the polls the day of the election. The polls will be open from 8 am until 8 pm.

Thoughts?

The Cost of Stimulus to Idaho...

There seems to always be a cost for everything, nothing I've found is really free. One of the costs that we here in the Capital just realized is that the stimulus bill will be costing Idaho citizens just to look at it.

A study was done many years ago that broke out what it costs the state for guys like me and all the support staffs to be here to make the decisions of the state. That number was around $30,000.00 per day or about $90k per month. I suspect that number is higher these days, but none the less the timing of the stimulus bill is going to keep the Legislature in session for a longer period. How long no one really knows, but we were on track to finish around the 3rd week of March. I would venture a guess that we've tacked on another 20 days at least with the potential for a special session later in the year. We are very likely to twist in the wind for a few more days while we continue to figure out just what parts of the stimulus we want and don't want. The Gov's direction to his departments is to get him their recommendations for their budgets by March 4th....

The Legislature was ready to start setting budgets this week, the delay in re-looking will delay that process and the staff and Legislators could be here through April and into May depending on what is selected to be put in the budgets and the reactions of the Legislators to those selections.

I'm not saying that we should not stay and do the state's business... but these costs all roll up into a big bill at the end of the year that you and I pay for with our taxes.

Nothing is ever free...

Thoughts?

The Idaho Stimulus...

Margaret Thatcher once said, "The trouble with socialism is that you eventually run out of other people's money"

We are trying to determine the current revenue rate of the state for 2010 to set our budget. As required by the Idaho Constitution, we are required to have a balanced budget at each year's end. Forecasted revenue for 2010 is down, way down and budget setting was to begin next week. That budget would be reflective of Idaho's economy and would become, as is the 2009 budget, the baseline for budgeting in 2011 and so on.

With the new stimulus package from Washington DC being set up for the Gov's office to request funds in the next 45 days, creates some issues. The Executive branch will have to understand what the 1100 page law now is and how to use those funds to meet the needs of Idaho, while not wrapping Idaho up with federal strings that typically come with "free money". But the Gov can not execute those funds unless they have been authorized by the Legislature (and in the stimulus bill, they kind of forgot to include that process).

We have put the normal budgeting process on hold to better understand just how the Legislative and Executive branches can most effectively and efficiently meld the funds into our process to move forward.

In my humble opinion, we need not knee jerk and do something silly before we truly understand the size of the tiger's tail we are about to grab. It makes sense to me to set our budget on what we know today and follow that up with a "stimulus supplemental" bill to keep the two separate. I don't think we will continue to get "socialist money" forever and need to ensure we are able to keep sight of what our true Idaho revenue and costs are to run our state.

One-time money rolled into our budget will cloud our process and our thinking.

Your thoughts?

Nampa & Meridian Irrigation District, Friend or Foe?...

After having received a number of calls and emails regarding the stories in the Idaho Statesman regarding Mr. Brian Bandhauer's plight of the Nampa & Meridian Irrigation District (NMID) wanting to take his property for "Hamburger Money", I had to better understand how this issue got so out of hand, as reported.


I contacted them on Friday to set up a meeting to ensure I had both sides of the story before determining if any action needed to be taken to help resolve perceived outstanding issues.


The NMID was very friendly and set up a meeting for me Monday morning (Dec 24th) so we could go over the issues that were reported as well as to answer any questions that I also had about the district. Daren Coon (District Secretary-Treasurer) who pretty much runs the office in Nampa for the district set up our meeting that included: Monte Janicek (elected Director for the Meridian area), Ron Becker (elected Director for the Nampa area) and John Anderson (District Water Superintendent).


We started out with the issues at hand, the printed stories within the local paper, and I asked them to tell me how we got were we currently are. They explained the situation that is well summarized in their press release below (some papers did publish "parts" of this press release):


"News Release
Nampa & Meridian Irrigation District
1503 First Street South, Nampa, Idaho 83651
Tel: (208) 466-7861 -- Fax: (208) 463-0092
Serving The Treasure Valley Since 1904

Nampa, Idaho
December 21, 2007

The following statement was issued today – Dec. 21, 2007 – by the Nampa & Meridian Irrigation District.

The Nampa & Meridian Irrigation District Board of Directors has reviewed the case of Mr. Brian Bandhauer, the Meridian property owner who has protested the $4.78 in fees associated with his delinquency on District tax assessments for 2006. In order to avoid further controversy and confusion resulting from the Idaho Statesman’s reporting on this matter, the District will waive the late charges so that Mr. Bandhauer's property may be removed from the list of irrigation district tax delinquencies.

The Idaho Statesman’s inaccurate reporting and editorial opinion on this matter highlights the importance of fact checking before going to press. The truth of the matter is not as titillating as the story the Statesman chose to tell at Mr. Bandhauer’s urging.

The District does not “slap” or “take out” liens on the property of any landowner, as suggested by the Statesman. Like property taxes, irrigation district assessments are declared by Idaho statute to be liens upon the assessed real property until the taxes are paid. In the year after the assessment is levied, irrigation districts are required by Idaho statute to file with the county a list of properties that are delinquent in paying assessments. This list includes all delinquencies, not just those from the prior year.

After the District files the delinquency list, delinquent landowners have three years to “redeem” the property from the list by paying the delinquency. As with property taxes, if a landowner has not paid the delinquency, including penalties and costs, Idaho law requires that an irrigation district “must” make a tax deed in favor of the District for the property. This occurs after the property owner is provided notice of pending issuance of the tax deed, and an opportunity for hearing before the district board of directors. The board’s decision to issue a tax deed is subject to judicial review. Even at this late stage, the property owner has an opportunity to redeem the property before it is sold at auction.

The number of delinquencies within Nampa & Meridian is typically around 2,000. The vast majority of these are resolved, so that, annually, only one of the approximately 40,000 tracts of land within the District is sold at tax deed auction.

The District is not “fighting” with Mr. Bandhauer and has not “slapped” a lien on his property to grab his cheeseburger money as suggested in the Statesman editorial. Mr. Bandhauer’s property has been part of Nampa & Meridian Irrigation District since 1904. The land was recently subdivided in 2000. Delinquencies in 2001 and 2004 were all resolved by payment within a year. In fact, the title company involved in Mr. Bandhauer’s purchase of the property paid the 2004 delinquency and 2005 assessment within a week after Mr. Bandhauer purchased the property, which makes Mr. Bandhauer’s ignorance of the assessment all the more perplexing.

Just last month, in November, Mr. Bandhauer sent payment for the 2006 and 2007 assessment with a note indicating that he had discovered the mistaken address. He deducted from his payment the $4.78 in penalties and costs because he assumed the District had made the error. After investigating the situation, the District discovered that the error was in Mr. Bandhauer’s deed, and suggested that he seek reimbursement from the title company that made the error. Mr. Bandhauer’s response was that he would not call the title company over $5, and would instead contact the press.

The result is two articles and an editorial opinion that incorrectly characterize Nampa & Meridian’s actions and motives. We regret Mr. Bandhauer’s course of action, and the Statesman’s reporting on this matter. The District has received numerous disparaging and threatening emails and phone calls, none of which are warranted by this situation.

Nampa & Meridian will continue to work with landowners to resolve delinquencies, following the procedures mandated by Idaho statutes. Nampa & Meridian explains the assessment and delinquency process to landowners through its assessment notices, in newsletters and on its website – www.nmid.org. As part of its response to the Statesman’s reporting on this matter, Nampa & Meridian will review and update those notices in an effort to more effectively communicate with landowners on this issue.

The District will have no further public comment on this matter."



We discussed the current process of customer billing and collections (set by the State code) by the district, how it compares to other districts, their success as compared to other districts and the process for challenging billing. It appears that they do go above and beyond state code with regards to communicating with their customers and prior to the taking of any property deed for auction (that happens in the 3rd year of a customer not paying their bills).


In fact both Mr. Coon and Mr. Anderson related stories about how they, every year, go door to door to ensure that the 3rd year owners on the list for being behind and in line for the Taxing District taking the deed for auction, or tenants of the properties are notified face to face (this not required, but is done after the certified letter is sent as well letting folks know they are behind in their payments). There appears to be plenty of effort involved in trying to communicate with customers that are behind, but mistakes are still made and there is an excellent process in place for challenging those issues via the elected Board of Directors, one just needs to ask.


As far as the process goes, I came away with the feeling that the largest irrigation district in the State is managing their customers properly and within the law... I also learned a great deal about the irrigation district that I would encourage others to also look into.


Most Meridian residents these days live on what used to be farmland (some still is). There are well over a hundred square miles of farmland had water rights associated with those lands that were used to irrigate their fields. The owners of those lands got together in 1904 to form a taxing district where the combined water rights and costs of delivering water could be done for all the owners in the most cost effective way as possible.


In Meridian, the District takes care of providing water via canals and some pressurized systems. They provide the developers with the design criteria for setting up pressurized systems that will be compatible with the water system that NMID manages. After development, these systems are normally then turned over to NMID for management and maintenance. There are still systems in Meridian that are managed by the local home owners association where maintenance and fees are handled in a different manner. The cities of Boise and Nampa each have their own methods of managing the irrigation delivery systems and maintenance of those systems along with the billing for those services.


The district is a not for profit taxing district that puts our district tax Dollars to use in maintaining the canals, pressurized systems and providing communications to customers about their irrigation and to developers with regards to building systems to a base set of standards. I would encourage you to visit their austere offices at 1503 1st S. in Nampa to see how they are spending your Dollars and how they stretch the Dollars they do receive to provide all of us with the irrigation water we use for our yards in the summer and the farmers in the district with the water they need for their crops.


Our NMID Board of 3 Directors is elected on a staggered basis (one new Dir. is elected every year for a 3 year term). The Directors oversee the $2.8M budget that is used to operate and maintain our district's irrigation system. As you might have realized, the system is quickly becoming a system that supports a more urban environment as opposed to it's original design. Our Directors ensure that they review process and procedures so that the district can provide support to all of it's customers in the most efficient and effective way possible.


The NMID has a website, we discussed putting more information on it so that folks might be able to better understand the charter and operations of NMID and it's process and programs that it provides to all of their customers (like being eligible for opting out, giving up your lot water rights or understanding where these tax Dollars are being spent).


I walked away satisfied with the processes in place. People need to take the time to understand the obligation they assume with regards to the NMID when they buy their property and use irrigation water. Everyone has a fair system of rebuttal to deal with any issues they might come across, they just need to ask the folks in the office and follow that advice.


Had Mr. Bandhauer followed the advice of the folks in the NMID office and contacted his elected NMID Director and discussed an option to waive his charges or even discussed the issue with his title company, that made the mistake in the first place that caused the penalty of $4.78, but instead ran to the media for resolution. I'm confident that the process in place would have resolved this issue quickly, effectively and fairly...


Maybe it's good that Mr. Bandhauer and the media created the "fanfare" it did so we can all learn more about the irrigation water that is so cost effectively provided to most of our back yards for a minimal costs to us.


Take the time to call the NMID and ask them any questions you might about have about the irrigation district at 208-466-7861. You will find that Mr. Coons is a wealth of knowledge with regards to how the district works and it's history. They can also connect you with your elected NMID Board Director, tell you if your land is eligible for opting out of the irrigation program or how to opt into the program. Understand that they do have 40,000 customers from Boise to Nampa that they work hard to communicate with via their newsletter (which I hope will soon be printed on their website), letters and press releases about our delivery system.


NMID's website currently has some limited information, but I believe we will be seeing more and more information very soon.

Your thoughts?

Merry Christmas to all...