Amends and adds to existing law to establish provisions regarding the County Property Tax Relief Act to provide that a county may establish a sales tax on certain lodging to provide property tax relief to homeowners in the county and to revise a provision regarding certain duties of owners of short-term rental properties.
House Bill 388 creates a new chapter in Idaho Code called the County Property Tax Relief Act. It authorizes county voters, by majority vote, to approve a county transient room tax of up to 3% on lodging sales, including hotels, motels, short-term rentals, vacation rentals, and campgrounds for stays of less than 31 days. The bill requires county commissioners to adopt an ordinance specifying the tax rate, duration, and purpose, and it requires at least 50% of annual revenue to be dedicated to property tax relief for county homeowners.
The bill also allows the remaining revenue to be used for certain county public safety services, including law enforcement, search and rescue, emergency medical services, and fire protection, and it provides a formula for sharing revenue with ambulance service districts and fire protection districts. Counties that levy the tax must create a county property tax relief fund, and the fund balance is used to reduce the county property tax portion of the budget and appear as a line-item credit on property tax bills. The State Tax Commission may collect and administer the tax under contract, or the county may do so itself.
In addition, the bill amends Idaho Code section 63-1804 governing short-term rental marketplaces. It clarifies that local governments may not tax the business of operating a short-term rental marketplace itself, but it requires marketplaces and owners to register and collect applicable state and local taxes on lodging transactions, including taxes imposed on short-term rentals and vacation rentals. The bill also makes technical corrections and declares an emergency, making it effective July 1, 2025.
The bill’s impact is to give counties a new voter-approved revenue tool tied to transient lodging, while directly linking that revenue to property tax reduction for homeowners and to selected public safety functions. It would affect county budgets, county treasurers, county commissioners, the State Tax Commission, lodging businesses, short-term rental operators, and local emergency service districts. By tying at least half of collections to property tax relief, the bill changes how counties may finance services and how property tax burdens are offset.
No committee transcript or vote history was provided, so the available context does not show recorded debate or formal support/opposition. Based on the bill text and caption, the measure appears designed as a property tax relief and local-option tourism tax proposal, which suggests likely support from proponents of homeowner tax relief and county funding flexibility, while potential concerns would center on higher lodging costs, administrative complexity, and the effect on short-term rental and tourism-related businesses.
The bill adds a new Chapter 26 to Title 63, Idaho Code, establishing the County Property Tax Relief Act and authorizing counties, with voter approval, to impose a transient room tax of up to 3% on qualifying lodging sales. It requires counties to dedicate at least 50% of revenue to a county property tax relief fund and permits the remainder to be used for specified public safety purposes and certain district distributions. It also amends section 63-1804 to clarify tax collection obligations for short-term rental marketplaces and owners, while preserving limits on taxing the marketplace business itself.
No committee discussion or vote record was provided, so there is no documented legislative sentiment from hearings or roll calls. From the bill’s structure and findings, the measure is framed positively as a homeowner property tax relief and county service funding bill, suggesting a pro-relief, pro-local-control rationale. At the same time, the lodging industry and short-term rental operators could view it as a new tax burden and compliance requirement.
The main points of contention are likely to be whether counties should be allowed to add a lodging tax, whether the tax fairly shifts costs to visitors rather than residents, and whether the revenue should be earmarked primarily for property tax relief versus public safety services. Lodging businesses, short-term rental marketplaces, and tourism interests may object to the added tax and administrative obligations, while county officials and homeowners may support the measure for its potential to reduce property taxes and fund local services. The bill also raises implementation questions about collection, auditing, and revenue apportionment among counties and special districts.