Gov. C.L. “Butch” Otter said Thursday morning that funding his proposed increases in education spending take priority for him over any tax cuts.

Otter said the reduction in income taxes that will come from Idaho aligning its state income tax code with the federal one is already a form of tax relief. And, he expressed skepticism over efforts to loosen Idaho’s constitutional restrictions on funding parochial schools.

“Let me reiterate, my priority is my education package,” Otter said at a breakfast with the Idaho Press Club Thursday in response to a question about tax cuts. “My priority is my budget package that I put forward.”

The Idaho House has passed a bill backed by GOP leadership to cut the top two income tax rates and also expand the grocery tax credit, but its chances in the Senate are far from certain.

Otter started his question-and-answer session Thursday by defending his budget in general and his proposed education spending increases in particular. He pitched them as an economic development tool since they will boost the number of young people with college degrees or professional certifications. Tax cuts won’t help if you don’t have people with the skills to fill the jobs, he said.

“Quite frankly, the business isn’t going to come if they don’t have the workforce,” he said.

Otter also defended his school spending proposal, which includes funding the “career ladder” teacher pay raises and returning schools’ per-classroom operational funding to the 2009 levels, against criticism from the left that returning to 2009 levels isn’t enough for 2016.

“Those that were suggesting ‘Why should we have a goal of going back to 2009?’ — it was their suggestion!” he said. “I’ve heard that every year since we made the cuts, ‘Why don’t we get back to where we were?’”

Otter proposed increasing spending on community colleges by 9.6 percent and on the state’s four-year colleges by 8.8 percent, including new programs such as a “tuition lock” that would keep tuition flat for public university students who finish in four years and a scholarship program to encourage adults with some college to get their degrees. He said passing these would show businesses that Idaho lawmakers are serious about workforce development.

“That portends for a strong workforce, and not only that, but I think a workforce capitalization will respond (to),” Otter said.

Otter said the yearly bill to align Idaho’s state income tax code with the federal one, which he signed on Tuesday, would reduce taxes to the tune of $17 million for the rest of this fiscal year (which ends June 30) and almost $29 million in the next. The changes are because Congress made certain tax cuts permanent in December 2015, including deductions for college tuition, teachers buying school supplies, and an equipment deduction that is popular with farmers and small businesses, according to the Spokane Spokesman Review.

“For those people that are asking for tax relief, that’s $45 million in tax relief,” he said.

Otter also said he was skeptical about a proposed change to the state Constitution’s “Blaine Amendment,” which bars any state funding for religious schools. The proposal, put forth by Rep. Ron Nate, R-Rexburg, would guarantee that students at private religious schools can use public scholarship — which they do already, but Nate said the change would protect the state in case of a lawsuit. Some opponents have said the change could open the door to a school voucher system.

Otter said he is “very cautious about fussing with the Constitution” and that no one has seen the current use of scholarships as conflicting with the Constitution before.

“They’re picking on an old sore, and they’re going to make it a scar if they’re not careful,” he said.


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