CALDWELL, Idaho (AP) – The fast-growing town of Caldwell in southwest Idaho is halting all new housing development for four months as city leaders say a new property tax law could put its citizens in “imminent danger” by putting public security services on hold burdened. Officials say other cities are considering similar moves.
Brad Little, Governor of Idaho, signed the property tax bill last week. The bill limits city governments to recognizing only a percentage of new development in tax districts rather than the full amount. Grants Big New Land Tax Breaks to Corporations and Developers; increases homeowner’s exemption from property tax by 25%; limits local government property tax budget growth to 8%; and contains other provisions. The legislature pushed through the bill within three days shortly before the end of the session.
City guides often seek “growth wages for growth” trying to capture 100% of the taxable value of new developments so as not to overburden existing residents to pay for the advanced public security services required to accommodate new residents.
The new law will either restrict growth or impact services, said Kelley Packer, executive director of the Association of Idaho Cities.
“This is not a threat. It has to be one or the other, ”said Packer. “We can’t just grow if we can’t meet the service needs of that growth. And when we do that, the service will be negatively affected – it’s just one or the other. “
Packer said Caldwell isn’t the only one considering stopping the growth. Emmett, Rathdrum, Nampa, Kuna, Star and other cities in Idaho are also looking closely at what impact the new law will have.
Caldwell grew around 26% between 2010 and 2019 and is one of several cities in the region that already has a housing shortage.
City attorney Douglas Waterman said the moratorium on new residential development will give the city time to develop a budget that will ensure city services meet the needs of future residents.
“The long-term goal is not to stop growing altogether, but to grow as best you can to make sure people have police and fire,” Waterman said.
Some developers say the moratorium will push house values already soaring in the region even higher, which will exacerbate a real estate crisis.
“I suggest you don’t make the same mistake the governor made when he signed this,” said Tim Mokwa, a development manager for Hayden Homes, who approved 57 residential lots at the beginning of the meeting. “You have inherited a very difficult situation. I just suggest that you don’t dwell on what you think is a solution too soon. “