Idaho lawmakers try to predict the state’s economic future | Idaho News

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By KEITH RIDLER, Associated Press

BOISE, Idaho (AP) — Lawmakers on an economic forecasting committee working on recommendations the entire legislature can use to set the state budget struggled Thursday to consider how billions of dollars in federal coronavirus relief funds will influence the state’s financial position going forward.

Lawmakers on the Economic Outlook and Revenue Assessment Committee have expressed concern that Idaho’s record $1.6 billion budget surplus may in part be due to relief money from coronaviruses that will dissipate in the coming years.

“I think there’s no doubt that federal funds are contributing to our record revenues,” said Erin Phipps of the Office of Legislative Services, who is part of the Legislature’s support staff. “But there are also economic indicators happening in the state that suggest it’s not just about federal funds.”

She cited high population growth and low employment as examples.

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The committee will make recommendations that will be used by the entire legislature to set the state budget for fiscal year 2023, which begins this summer. Lawmakers begin meeting on Monday.

“Probably this session is going to be about tax cuts, which I think will be very good,” Republican Sen. Fred Martin said. “It’s relatively easy to vote for and sell a tax cut to the Legislative Assembly and the general public. It is much more difficult to come back later and possibly make a tax increase, which I do not want to vote for.

In December, a senior House Republican said a $400 million tax package including a $200 income tax cut and $200 million one-time tax relief was in the works for the legislative session. . Last year, Republican lawmakers passed about $400 million in tax relief that Democrats say benefited mostly the wealthy.

Also on Monday, Republican Gov. Brad Little will deliver his state of the state address and release his own recommended budget. The state will also release a new budget forecast on Monday, potentially increasing the projected budget surplus even further.

Lawmakers on the committee spent a lot of time asking about the state’s unemployment rate and labor force participation rate.

Idaho’s unemployment rate was 2.6% in November, tied for fourth in the nation. But the state’s labor force participation rate fell a tenth of a percent to 62.3%, a new all-time low. Idaho’s peak labor force participation rate was 71.4% in September 1998. The labor force participation rate includes people 16 and older who are working or looking for work.

Craig Shaul of the Idaho Department of Labor told them the state had a labor shortage.

“Employers are actually trying to attract the workers they need from each other,” he said. “Competition for employers is no longer just for customers, it’s for workers to get the job done.”

Various speakers addressing the committee attributed the low rate of participation in the labor market to workers who choose to retire and to family members, mainly women, who stay at home to take care of children or elderly family members.

“A lot of these people are staying home because of a lack of child care or elder care,” said Tom Kealey, director of the Idaho Department of Commerce, noting that some 200 child care centers have closed. during the pandemic.

Other topics heard by lawmakers included potential issues with the ongoing coronavirus pandemic and new variants, sharply rising housing prices, potential inflation issues and ongoing supply chain issues.

The committee is due to meet again on Friday to receive more economic information.

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