Experts hope for investment credit success
Bill offers producers an income tax credit of up to $500,000
By SEAN ELLIS
BOISE -- Supporters of a bill creating a tax-credit designed to create more value-added agricultural processing in Idaho say it stands a better chance of passing the 2013 Idaho Legislature.
The bill passed the House by a 62-6 vote last session but died in the Senate when the chairman of the Local Government and Taxation Committee, Sen. Tim Corder, R-Mountain Home, didn't allow it to be introduced in that chamber.
The so-called Ag Jobs bill would have offered producers an income tax credit of up to $500,000 for investing in any process that adds new value to an Idaho agricultural commodity and created at least one new job.
It would have provided a tax credit of up to 30 percent on an investment to build a processing plant or other value-added process for Idaho ag commodities. Producers could have received the credit in the form of 50 percent of their tax liability for up to 14 years.
The architect of the bill, Sen. Roy Lacey, D-Pocatello, has moved from the House to the Senate and will introduce the bill in that chamber. Rep. Donna Pence, D-Gooding, who co-sponsored the bill last year, will introduce it in the House.
Lacey and Pence are members of the minority party and will seek as many Republican co-sponsors as possible to give it a better chance of passing.
While it was making its way through the House, the bill was supported by most of the state's main ag groups, including Idaho Farm Bureau Federation, Food Producers of Idaho, Idaho Cattle Association, Idaho Dairymen's Association, Milk Producers of Idaho and Idaho Grain Producers Association.
"If it comes back with the same language and the same results, I doubt Food Producers would oppose it," said Rick Waitley, executive director of FPI, of which all those groups are a member. "Our members felt it was a decent piece of legislation."
Supporters said the credit could be used on a wide range of potential activities, from converting agricultural waste into energy to turning grapes into raisins.
The bill was introduced later in the 2012 legislative session and Corder said there wasn't enough time left to have an honest debate on what he said would be a significant departure from current state tax policy. He also said it would have a negative impact on the state's coffers.
Corder was defeated in the primary election by Sen. Bert Brackett, a Republican rancher from Rogerson, and Sen. Jeff Siddoway, a Republican rancher from Terreton, is now chairman of the Local Government and Taxation Committee.
"I think it will be treated more kindly during this next session," Brackett said.
Lacey said the bill will be introduced much earlier in the 2013 session, which begins Jan. 7, and he believes it stands a much better chance of becoming law this year.
"I think it will have a better chance this year; we just have to get started earlier," he said.