House Majority Caucus Room
February 9, 2004
The meeting was called to order at 4:00 p.m. by Cochairman Senator Bunderson. Other
members present were Cochairman Representative Crow, Senator Kennedy, Senator Malepeai,
Representative Raybould, Representative Jaquet and Representative Henbest. Senator Stegner
was absent and excused.
Others present were Mike Ferguson, Division of Financial Management; Dan John, State Tax
Commission and Randy Nelson, Associated Taxpayers of Idaho. Staff members present were
Mike Nugent and Toni Hobbs.
A copy of the revised draft of the sales tax task force report was distributed. This revised
version contains everything the original draft did with additions from Representative
Raybould. Representative Henbest's comments were distributed in a separate document and
will be added. Other task force members were encouraged to prepare additions to the report if
they so chose.
A revised letter to the Pro Tem and Speaker was also passed out to the members of the task force.
Senator Bunderson added that a sentence should be added to the letter informing people to send
additional comments to Mike Nugent in the Legislative Services Office with his E-mail address
email@example.com. Representative Crow said that would be okay with her but after this
meeting, the task force will be dissolved so comments received would be for future use. Senator
Representative Henbest asked how the decision was made to dissolve the task force. In her
opinion the work has not been completed and the task force should continue. Representative
Crow stated that in discussions with the Speaker of the House, the task force is to be dissolved
after this meeting. Senator Bunderson commented that this task force is just making a report
on what information was reviewed and the Speaker and Pro Tem will advise on the continuance
of the task force in the future.
Representative Raybould said that in his opinion the work of the task force has been completed
and future work done in this area should be done by Germaine committees in the House and the
Senate after they look at the task force report. Ending the task force's work does not end the
discussion on sales tax exemptions. Comments from the public, task force members or other
legislative members should be brought before the Germaine committees that handle taxes.
Senator Bunderson said that the letter does not specify Germaine committees, it just says the
legislature. Leadership will be able to make the decision on how to proceed.
Representative Jaquet comment that she had hoped the task force would make a recommendation regarding the Streamline Sales Tax Act. Senator Bunderson said that arguments are included in the report and that legislation is being drafted regarding that subject.
He added that the letter to the Pro Tem and the Speaker contains language stating that the
arguments and comments contained in the report are not complete. It also states that no
recommendations are being made. To add a recommendation regarding the Streamlined Sales
Tax issue would require modification of this letter.
Senator Bunderson continued that the report contains all arguments regarding the sales tax
exemptions that were received by the task force or by Mr. Nugent from others. These arguments
were not weighted or evaluated and are presented as information to others.
Senator Kennedy said that in his opinion, the task force members did not meet the charge of the
task force. After receiving an excellent analysis from the State Tax Commission of the pros and
cons of the various tax exemptions, the task force did not debate, discuss or evaluation any of
them. His understanding was that the task force was charged to make some sort of
recommendation. Representative Crow commented that the Speaker made it clear to her that he
wants to review the draft report and then decisions will be made for the future direction of a
study of the sales tax exemptions.
Senator Bunderson said that, in his opinion, the task force is at an impasse and moving forward
at this time would not be effective. He suggested letting the Pro Tem and the Speaker decide
what to do next after reviewing the report. Representative Crow agreed. Senator Bunderson
added that the report does not suggest that the task force be dissolved or that it continue. The
door is left open for future direction.
Representative Raybould stated that the task force opened the door for public comment on each
of the exemptions after the tax commission presented the information. The opportunity was
there for anyone who had an interest in these exemptions to comment. The report gives the pros
and cons of each exemption so that other members of the legislature will have the information.
Representative Henbest said that the letter to the Pro Tem and Speaker needs to include a
statement that the task force did not complete its charge. Senator Bunderson stated that the
letter does say the charge was not met in different words. Senator Kennedy, Senator Malepeai
and Representative Jaquet agreed with Representative Henbest and suggested the wording be
changed to actually say the task force did not complete its charge. Senator Malepeai added that
he wants to make sure the letter is not misconstrued to say that sales tax exemptions do not need
to be looked at. Senator Bunderson said that there would be no problem with another letter
being attached stating the differing views of the task force members.
Senator Kennedy clarified that his comments should not be taken to mean that he is in favor of
additional sales taxes on services or that certain exemptions should be excluded. His point is
that the task force did not meet to evaluate the exemptions using the information that was
Senator Bunderson, in order to reach a middle ground, suggested adding a paragraph that
recommends additional work be done in order to complete the task force charge. Senator
Kennedy said that the existing wording does state that the task force did not meet its charge and
did not make recommendations but it could be worded more explicitly. Representative Crow
added that those who do not feel comfortable with the wording of the letter could have their
names removed and write their own letter.
Representative Jaquet stated that the problem with this has to do with other groups that felt the
task force would be able to accomplish something. It was assumed that the task force would take
more than one year to complete its charge and to not go forward with the issues that have been
discussed would be inappropriate. She suggested adding an amendment to the bottom of the
letter for those that feel that task force did not complete its work.
Representative Raybould commented that in his opinion the letter explains what the task force did. The discussion that the task has not been completed assumes that the task force was going to make recommendations on the exemptions. Each exemption was analyzed and no motions were made suggesting any exemption be removed. If task force members had the expectation that exemptions were going to be removed, it was not brought up during the meetings.
Senator Kennedy said that in his judgment no motions were made to remove exemptions due to
the fact that those possibilities were never discussed. The data was presented by the State Tax
Commission but that was all. It was his belief that a meeting was going to be held allowing task
force members to discuss the information received and then debate whether an exemption should
be removed or not. Senator Bunderson agreed that the task force did not discuss these things
and suggested allowing the legislature to decide what direction to take next because it is clear
that the task force is at an impasse.
Senator Bunderson made a motion that the task force accept the letter as written with the
addition that "additional arguments be sent to Mike Nugent in the Legislative Services
Office at firstname.lastname@example.org."
He suggested that these comments could then be kept separate from the report as an attachment
for people that want to review those comments at a later date.
In response to a question from Senator Kennedy, Senator Bunderson stated that the revised
version of the report is the one that will be submitted at this time. The letter being discussed will
replace the letter on page 3 of that report.
Representative Raybould added to the motion that this letter replace the letter on page 3 of the
revised report with the additional wording suggested by Senator Bunderson.
Representative Henbest stated that for her to sign the letter it has to contain an explicit statement that the task force did not complete its charge and that additional work needs to be done. She also said that the revised report is not acceptable to her due to the fact that an addition to the evaluation criteria has been added. This evaluation criteria was set at the first meeting of the task force and additional items should not be added after the evaluation has been completed. Representative Raybould said that the two new criteria items were discussed and added at the first meeting. Representative Jaquet said that she does not remember the new criteria being discussed.
Senator Bunderson stated that his position in the first draft was not to make a judgment on
someone else's argument. He suggested letting all of the arguments stand on their own without
any changes or deletions. Representative Henbest agreed with that. Senator Kennedy said
that if the task force is not going to make any recommendations and is only going to compile the
information received at the meetings of the task force, the report should not contain any
opinions. He would accept the letter if this was to be the case. He would like to see the first
draft report be submitted. Mr. Nugent clarified that the arguments for the first report were taken
from task force minutes and from past Revenue and Taxation Committee minutes where
necessary. He added that Representative Henbest had also prepared comments to the report
that need to be added.
In returning to discussion of the letter, Representative Jaquet stated that she would like to
include language stating that the committee was at an impasse and is unable to go forward.
Senator Bunderson said most people agree that the task force is at an impasse. Representative
Crow said that the task force needs to reach a compromise in this area in order to produce a
Senator Kennedy suggested adding language to the letter in the second to last paragraph after
"We submit this report without recommendation" adding the words because the task force could
not reach a majority opinion. Representative Raybould suggested saying the task force could
not reach a consensus. It was discussed that consensus was not the correct word. The wording
was changed to say because the task force was divided in its opinion. Senator Kennedy agreed
with that language.
Senator Kennedy said that he would be willing to accept the letter with the additional wording
if the first draft of the report was submitted. After more discussion Senator Bunderson
suggested letting the arguments in the first draft report stand with nothing being deleted or
weighted. He continued that additional comments would be accepted and accumulated by Mr.
Nugent to be given to anyone who requests them. He also added that any task force member is
welcome to add their own arguments to the report. This document was prepared to give future
task forces or committees a report to use as a starting point. Representative Crow suggested
submitting two reports with the members signing on to whichever report they support. Senator
Bunderson said he did not feel comfortable with that extensive of a difference and asked that if
people have a position to make, they put it in letter form and attach it. Submitting two reports
would be very confusing.
Representative Henbest made a substitute motion that the task force make changes to the
letter by adding "at the meetings" after "Arguments presented", adding that comments
can be sent to Mike Nugent in the Legislative Services Office at email@example.com
and adding a sentence that reflects the task force did not meet its charge. Her motion
includes that the report submitted include all arguments from committee members without
editorializing or deletions of preexisting language and that the additional evaluation
criteria be struck.
Senator Bunderson clarified that her motion says that the revised draft is satisfactory if the
strike outs are not allowed and that the last two criteria evaluations points be struck.
Representative Henbest said that she would also like her additional arguments incorporated
into the final version to be submitted. Senator Bunderson said that everyone's
comments/arguments will be included if they so choose to submit them. He added that they
should be submitted to Mr. Nugent by Friday, February 13, 2004.
Representative Raybould made an amended substitute motion that the task force accept
the letter as rewritten but leave the additions to the evaluation criteria in the report.
The amended substitute motion failed by voice vote.
The substitute motion carried by voice vote.
Senator Kennedy said that Representative Raybould and Representative Crow can submit a
letter stating the items they would like included in the report.
It was discussed that the Streamlined Sales Tax issue was not part of this task force's work and
that legislation is being prepared on that issue.
Representative Crow moved that the task force adjourn sine die. The motion carried and
the meeting adjourned at 5:30 p.m.