Idaho's Teton County Commissioner Ron James, owner of Captain Ron's Smokehouse in Driggs, cleared the first legislative hurdle Monday in his push to allow Idaho counties to tax short-term rentals to pay for tourist impacts.
James successfully presented proposed legislation to the Idaho Association of Counties Revenue and Taxation Committee in Boise, advancing a measure that could help his cash-strapped county deal with thousands of visitors heading to Grand Targhee Resort in Alta, Wyoming.
Idaho's limited revenue options create what James called "a double whammy" where his county provides law enforcement, emergency services, and road maintenance for tourists but can't capture significant tax revenue from their visits.
"At any given time, there might only be one or two deputies on patrolling the whole county," James told Cowboy State Daily.
This is one example of the resource strain that comes as James' county absorbs the impact of tourism while feeling left out, as neighboring Wyoming counties collect ample lodging tax revenue.
Haves vs. Have Nots?
The proposed $1.5 billion Grand Targhee Resort expansion illustrates the dramatic funding disparity between the two states. James said the project will generate about $2.8 million annually for Teton County, Wyoming, and perhaps as much as $1.8 million for Idaho Falls.
Idaho cities are allowed to tap into tourism with local taxes, but counties are not.
At the same time, Idaho counties deal with a 3% annual cap on property tax increases.
James said this leaves them falling behind inflation, while Wyoming's more flexible tax structure generates substantial tourism revenue.
Teton County, Idaho, said James, will see about $287,000 in tax revenue from the Grand Targhee expansion, while absorbing the brunt of the expected tourism impact.
“The only way to get to that ski resort is through our county,” said James. “And the majority of the people that are going to be going to ski, they're going to be staying in our VRBOs and our hotels."
Commissioner Dan Powers, who serves alongside James, explained that Idaho's tax structure puts counties at a severe disadvantage compared to Wyoming.
“We just fall a little further behind every year because it’s not even covering inflation,” said Powers.
Some Support
Wyoming's Teton County already provides some financial support to Idaho for services that benefit their residents. Powers noted that "they contribute to fire and EMS, right now.”
Speaking for Wyoming’s Teton County, Commissioner Wes Gardner acknowledged his neighbors' challenges after a joint meeting between the two county commissions Sept. 9.
"Their residents are our workforce," Gardner said. "When you look at funding a county in Idaho compared to running a county in Wyoming, it’s different as far as the funding that's available. So that makes things tricky."
Gardner said Idaho commissioners were "experiencing significant impacts from properties in Wyoming on their infrastructure, whether that's roads or whether that's deputies or ambulances. And they're asking for help."
The proposed legislation would authorize Idaho counties to impose up to a 2% "user fee" on short-term rentals to help "mitigate the cost of the impact that they bring when they come and visit our towns," James said.
The legislation now needs approval from the full Idaho Association of Counties, which forwards only five resolutions each session to the state legislature. If selected, it would face the legislative process when Idaho's Legislature convenes in January for its 100-day session.
Before then, James said he and other commissioners are working to form a coalition of other like-minded Idaho counties, seeking more ways to bring in revenue.
He said, “There’s more counties in favor of doing this because they're feeling the same effects we are."
David Madison can be reached at david@cowboystatedaily.com.
