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House members look over a bill providing an estimated $1.65 million a year to build sidewalks for children to walk to school at a House Transportation and Defense Committee meeting on Tuesday.

BOISE — The Idaho Legislature is going into what is expected to be its last day of this year’s session Wednesday with transportation funding mostly taken care of but with a major decision on taxes left for the Senate.

A session-ending compromise to increase transportation funding passed the Senate by just three votes Tuesday. The bill would authorize taking out $300 million in bonds that would be repaid by future federal highway payments — much of which would likely be spent on Interstate 84 in Canyon County — as well as creating a new fund for some state transportation projects and extending the “surplus eliminator,” which directs some excess state revenues into road maintenance, for another two years, which 60 percent of that money going to the state and the rest to local highway districts.

Some elements, including the bonding, are the same as in another bill which failed in the Senate by five votes last week, a failure that was a major factor in the extension of this year’s session past the expected March 24 adjournment.

The bill then went over to the House, where it ran into less opposition, passing 51-19 early Tuesday evening.

The House also passed two other transportation bills — a bill that will direct an estimated $1.65 million a year to build sidewalks to provide children to safe routes to schools that the Senate will still need to take up Wednesday, and a bill directing $52 million in emergency relief money to repair roads in counties that have been hit hard by this year’s winter that had been pending for almost a month, awaiting a final transportation deal before it got a vote.

However, the House also amended a bill lowering the unemployment insurance tax employers pay — a decrease which will save employers money and reduce collections to the Workforce Development Training Fund but won’t affect the general fund — to include reducing each income tax bracket rate by one tenth of 1 percent, which would reduce revenue by about $28 million a year.

The tax cut attached to this latest bill was part of a compromise that was agreed to by Senate leadership earlier this month, but the Senate ended up rewriting the bill on the floor to become a bill abolishing the tax on grocery sales instead.

Lawmakers had originally hoped to adjourn Friday, but when that date came some major pieces on transportation funding and tax cuts, two major goals of many in the Republican leadership, were still outstanding. The bill repealing the grocery tax and the accompanying tax credit passed the House Monday and will soon be in the governor’s hands. It remains to be seen if C.L. “Butch” Otter will veto the bill — he has already said he is against repeal — and if he waits until the Legislature adjourns for the year to veto it, they can’t vote to override it.

Objections to the transportation bill ran the gamut. Rep. John Gannon, D-Boise, said while the House Transportation committee considered it, he worried that the bill takes about $15 million a year from the state’s general fund to put into the new fund for state road projects. Combined with possibly abolishing the grocery tax and cutting income taxes, Gannon worried that could eat up the state’s surplus next year and threaten funding the fourth year of teacher pay raises.

Sen. Chuck Winder, R-Boise, replied that Otter could be the “referee or sheriff” when it comes to deciding which spending ideas/tax cuts would become law.”

“I don’t know exactly what he’ll do,” Winder said. “He’s never said he liked the grocery tax provisions.”

Sen. Michelle Stennett, D-Ketchum, worried about borrowing so much and also said the bill didn’t do enough to fund either road maintenance or local transportation needs — the bulk of the money is for new construction on state and federal roads.

“We’re talking about (asking) all Idahoans to pay … and you’re only giving $3 million back to local governments,” she said. “Is that fair?”

Most of the bill’s supporters acknowledged as they debated that it wasn’t perfect but said it would address some major problems without raising taxes.

“Your colleagues in Canyon County are begging for your help,” Winder said.

The House cleared its entire calendar Tuesday, except for the Department of Administration’s budget. The body decided to send a bill creating a new scholarship for adults to go back to college back to committee, effectively killing it for the year. However, it passed the disaster road repair bill as well as approving $90 million in bonds to build two buildings associated with the Idaho National Laboratory.

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