LEGISLATIVE UPDATE | WEEK NINE
March 3 - 7, 2025
The Idaho Capitol was a hive of activity this week, evidenced by vigorous and exhaustive debates in committees and the floors of both chambers. There are results to report, including the passage of several significant new policies. Tensions remain high. We are seeing the byproducts of deals negotiated behind the scenes. This is all expected as we continue into the third month and week ten of the 2025 session.
Monday’s transmittal deadline spurred the chambers to focus on clearing the reading calendars of bills from their side of the rotunda. This caused contentious bills in the House and Senate to be held for several days as leadership worked to clear the logjam of dozens of bills that, for whatever reason, curried broad support.
Lawmakers briefly set aside differences to take in Tuesday's programming and festivities for Idaho Day. Then it was right back to work as the Senate launched into debate on HB 40 – the income tax cut bill and top priority of House leadership. The $250 million income tax cut cleared the Senate on a 27-8 vote and was quickly signed into law by Gov. Little yesterday. This is the largest tax cut in state history and continues four years of significant tax reform by the Legislature.
The passage of HB 40 set the stage for other tax cut bills to move quickly, including the House approval of a $100 million property tax relief bill. It now awaits consideration in the Senate. The Senate also passed HB 231, the grocery tax credit increase bill. These bills, combined with the income tax cut, equal over $450 million in tax cuts. The fallout of this is now being felt as JFAC grapples with budget cuts.
As we peer into the crystal ball, it’s worth noting that the greenlight given to the major policy bills in a way clears the path to consider a Sine Die timeline. The Joint Finance and Appropriations Committee (JFAC) finally set the FY 26 General Fund Revenue numbers the day after the income tax bill passed, determining how much cash is available to set the remaining FY 26 budgets.
Since the setting of the projected revenue number was delayed drastically, JFAC missed its budget-setting deadline of March 6th. JFAC will continue next week and beyond, trying to set budgets. The committee will then find out if they need to revamp any appropriations that fails to pass either chamber. Adding to this heavy burden were continued and major fights in JFAC Friday morning that surpassed what would typically flare up on spending bills. So much so, that the Co-Chairs called Speaker Moyle to intervene and help get the committee to move forward. We anticipate the friction and discord to continue throughout the remainder of session. With the Legislature’s constitutional obligation to set all budgets before going home, more of the appropriation bills will likely find their way into multiple competing motions and fail to pass as items are cut or amended, and the ability to balance all funding looks different after massive tax cuts.
Also, this week, amid Idaho Day traditions and major policy advancements, hundreds of citizens poured into to the Capitol to have their voices heard. In most cases, however, they failed to influence lawmakers. This has become more normalized over the last several years and is a reminder that committee members' minds are often made up before public testimony on policy begins. There is the occasional exception. This week the Senate Health and Welfare committee considered HB 245 and its call to expand foster care services. Despite handwringing from conservative lawmakers over increasing costs, the bill advanced thanks in part to gripping testimony from a foster parent and child, proving that it’s still possible for the smallest and most vulnerable Idahoans to make a difference in shaping policy.
