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What Otter forbids

There hasn’t been much notice of the substance because the bill in question sounds so boring, but we’ll note here that Idaho Governor Butch Otter has issued a veto. (The fact of the veto has gotten some attention; the substance, little.) It’s just one veto (so far) to the 33 or so bills he has thus far signed into law, and it doesn’t portend any great political conflict. But as it offers an indicator of priorities, let’s pause for a moment.

The measure in question is House Bill 8, and the short legislative description of it is that it “Amends existing law to provide that a notice of levy and distraint be sent by regular first class mail instead of certified mail when collecting state taxes.” (Please don’t fall asleep; this gets a little more interesting.) It generated no major debate; it passed the Idaho House 64-2 and the Senate 35-0.

It was a small-government, or cut-government-cost, measure, proposed by the State Tax Commission (whose members are appointed by the governor). Here is its statement of purpose: “Current law requires the Tax Commission to send a notice of levy to taxpayers by certified mail. This costs about $28,000 annually to send more than 10,000 notices. Almost half are returned as refused or unclaimed. Changing the certified mail requirement to first class mail will likely result in more taxpayers actually receiving the notice more cost effectively.”

So . . . what’s the rationale outweighing this?

Here’s the core of Otter’s veto statement, explaining:

House Bill 008 proposes a single change to Idaho Code section 63-3061A as it relates to the notice a taxpayer receives when property is seized to satisfy debt for past taxes, interest, and penalties. The change would allow the Idaho State Tax Commission to provide notice to a property owner by first class mail, instead of certified mail.

It is anticipated that the Idaho State Tax Commission could save up to $25,000 in operation costs under this proposed change. I strongly encourage saving tax dollars and achieving cost savings within state government; however, this specific cost savings is minimal and inappropriate compared with the potential costs to property owners across Idaho.

Idaho has a long tradition of protecting and promoting private property rights. The Idaho Constitution sets forth the inalienable right to acquire, possess and protect property. This right is paramount to a free and prosperous society. To that end, there are many processes established under state law to protect property and an owner’s interests in it.

Title 63, section 3061A of the Idaho Code is no exception. Two years ago, the Idaho Legislature created a formal process for notifying property owners when their property was to be seized for tax debts. Notice in these situations is critical for property owners to defend any rights or interests in their property, and using certified mail provides greater assurance that notice is actually received.

Although some may argue that the additional cost of using certified mail is unnecessary, it is an appropriate safeguard that we owe property owners. For these reasons, I cannot support diminishing the process established under title 63, section 3061A of the Idaho Code as proposed by House Bill 008.

So what trumps government savings? Private property rights.

Not to argue here that Otter is necessarily wrong; he makes a fair point here. But this first veto message does offer some insight into the new governor’s order of priorities.

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One Comment

  1. Alan Alan February 27, 2007

    Property owners are more likely to get notice if the letter is not sent certified mail. A good many folks, when in financial difficulties, begin to ignore mail. Some folks will refuse to pick up certified mail, knowing that is is proof of receipt of bad news.

    Certified mail gets delivered by the same people in the same way as regular mail, pretty much. If no one is home to sign there are couple of additional efforts to deliver it, but again, same letter carrier, same method.

    The real difference is that the sender can prove that the notice was delivered. The difference applies more to the sender than the recipient.

    Gov Otter’s rationale doesn’t really mesh with the reality of mail delivery. The Industrial Commission recently considered the same idea and reached the same conclusion as the tax commission. From meeting minutes available here

    “Subcommittee Chair Max Sheils reported that this subcommittee was formed to determine the feasibility of allowing the Commission to send hearing notices via first class mail in addition to mailing notices by certified mail. Mr. Sheils stated that the Industrial Commission in virtually every case holds a telephonic conference with the Referee and the parties prior to a hearing so that all parties are aware of the impending hearing. Mr. Sheils found that the adjudication staff contacts pro se claimants prior to a hearing to ensure proper notification. Once the subcommittee agreed to change the rule, Legislative Services was contacted and the proposed changes were drafted to §72-713. Mr. Sheils reported that the proposed change would reduce mailing costs for the Industrial Commission from approximately $2,000 per year to approximately $300 per year. He also noted that the Supreme Court as well as the District Courts all send notices by first class mail. The subcommittee recommends the Advisory Committee approve the amendments to §72-713. After discussion and consideration, it was the Advisory Committee’s consensus that the subcommittee’ recommendations be adopted and the Industrial Commission proceed with the amendments of Idaho Code §72-713, allowing notices to be sent by first class mail. Senator John Andreason agreed to sponsor the bill since the deadline for submitting legislative changes by the Commission has passed. The Commission agreed to support the changes.”

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