Tax Relief Takes Center Stage
Six months into the current state fiscal year the state budget surplus stands at $1.9 billion. Let me repeat that: the state budget surplus is $1.9 billion and counting. With such a large budget surplus, all eyes are on what to do with it. The Governor has laid out his priorities which include using some of the surplus for infrastructure (including $200 million for local bridges), increasing education funding, and reducing income taxes. House leadership has also prioritized reducing income taxes. In fact, the first bill of the session sponsored by House leadership (House Bill 436) leverages $350 million in surplus funds to provide a one-time income tax rebate as well as an additional $200 million in online sales tax collections for ongoing income tax relief.
While House Bill 436 is the first tax relief measure, it won’t be the last. There are growing calls from both the public and other legislators to leverage the surplus for property tax relief, reduce voter approved supplemental levies, and repeal the sales tax on groceries. Some of these calls will be met in the coming weeks as more ideas are introduced as formal bills. IAC staff are working with several legislators on a variety of ideas to provide property tax relief, including full state funding of public defense, moving to a five-year rolling average for property tax purposes, and local option sales tax for property tax relief.
As bills are introduced, IAC will provide members with a county fiscal impact for any bill reducing or increasing county revenues. We’ll also keep you up to speed with the progress of revenue bills and let you know how to most effectively engage legislators on the important policy decisions impacting counties.