Bonners Ferry Local Option Tax passes
City of Bonners Ferry seal.
(Courtesy Photo City of Bonners Ferry)
BONNERS FERRY — Voters approved the Bonners Ferry local option tax Tuesday with 72% of the vote.
Out of a total of 431 votes cast, 310 were in favor and 121 opposed. The LOT measure needed a majority of 60% to pass.
The tax will be instituted on July 1, 2023, and run for 10 years, expiring December 2033. The LOT is an additional 1% tax on all taxable goods under $1,000 to pay for general fund departments such as Bonners Ferry police, fire and street departments, as well as property tax relief.
LOT are only available to cities under the resort status, which includes cities with a population under 10,000.
In 2022, after Bonners Ferry’s budget was finalized it was found that the Idaho Supreme Court ruling made it that the city could no longer allow the annual transfer of 5% gross sales in each enterprise fund, also known as utilities, to the general fund. It was found that the general fund department must be paid for by taxpayer dollars by costs associated with service.
Bonners Ferry, like many cities in Idaho, had been funding the general fund through utilities for more than 70 years. By no longer having this form of funding the city incurred a shortfall of approximately $480,000.
“The city appreciated voters supporting essential services we know are important to the community and we look forward to providing these services in perpetuity,” said Bonners Ferry Mayor Dick Staples.
The LOT will cover the annual shortfall for the next 10 years, but may not be enough to cover this year’s shortfall, as the tax will be in effect so late in the city’s fiscal year.
The city has cut costs in the general fund, by entering in an agreement with Boundary County to cover the $80,000 season cost for the city pool.
At the May 16 city council meeting, the declaration of sale of 13.5-acre property off Eileen Road was approved with a minimum bid of $250,000. The council cited that the land is underutilized or not used for public purposes. A public hearing will be held June 6 to give the public time to comment.