Clark Corbin/Idaho Capital Sun

A record-setting state budget surplus of nearly $2 billion is fueling talks about a potential special session of the Idaho Legislature - not unlike the conversation taking place in Montana.

The state officially ended the 2022 fiscal year on June 30 with a projected $1.4 billion state budget surplus, marking the second consecutive year Idaho has amassed a record ending cash balance. On Friday, Little said the surplus could reach $2 billion. He also appeared to lay the groundwork for taking action on the surplus.

“The Legislature and I are committed to more education investments and tax relief on top of the historic steps we’ve taken to support schools and cut taxes,” Little wrote in a Friday newsletter.

On Tuesday, Little’s press secretary Madison Hardy said the governor has not ruled out calling a special session. The 2022 legislative session has already adjourned for the year, and the 2023 legislative session is scheduled to convene Jan. 9. Legislators will also participate in an organizational session in early December, following the Nov. 8 general election – when all 105 legislative seats are on the ballot.

“The strength of Idaho’s economy and years of fiscal conservatism have led to another record budget surplus for Idaho, and Gov. Little has been very clear about his plans to propose additional investments in education and more tax relief for Idahoans,” Hardy said in a written statement. “Gov. Little has not ruled out a special session to help Idahoans grappling with crushing inflation and, as always, continues to actively discuss options with his legislative partners.”

Betsy Russell of the Idaho Press reported Monday that Little has not ruled out a special session.

Idaho legislators say they would work to provide relief to taxpayers

Speaker of the House Scott Bedke, R-Oakley, said he is working with Little to take “immediate” action on the record surplus.

“Idaho has another record surplus due to strong conservative leadership,” Bedke wrote in a statement released to the Idaho Capital Sun on Tuesday. “Biden’s inflation, however, is hurting everyday Idahoans. I am working with Gov. Little and my fellow members of the Legislature on ways to provide immediate tax relief for Idaho families and small businesses while also strengthening investments for future generations.”

Rep. Wendy Horman, an Idaho Falls Republican who sits on the Joint Finance-Appropriations Committee, said she would return to the Idaho State Capital for a special session if Little makes the call.

“I was glad to see that statement (from Gov. Little). Clearly revenues have far exceeded even our best estimates, and that is the people’s money,” Horman told the Idaho Capital Sun on Tuesday. “I am interested in acting to return some of that money to them at a time when it can be hard to put food on the table and gas in the car. Conceptually, I am in support of that general idea.”

“That is why we are elected,” Horman added. “It is our duty, and if that happens, I will go back and see what is on the table.”

A recent history of special sessions in Idaho

Under the Idaho Constitution, only the governor has the power to call a special session of the Idaho Legislature, which is officially called an extraordinary session.

Since 2000, Idaho governors have called special sessions in 2000, 2006, 2015 and, most recently, in August 2020, when Little called a special session to address election security and civil liability protection during a state of declared emergency.

If Little calls a special session, there could be multiple interesting political implications or tie-ins to the upcoming Nov. 8 general election.

Assuming he calls a special session before Election Day, the same legislators who are all coming to the very end of their terms would be called back to the Idaho capital in Boise, even though 19 of those legislators already lost primary elections this year and more than 20 other legislators retired or ran for a different office. All 105 seats in the Idaho Legislature are up for election in November, even though dozens of the races are not contested.

The issue of special sessions will also go before Idaho voters on Nov. 8. Voters will be asked whether or not to approve Senate Joint Resolution 102, a proposed amendment to the Idaho Constitution that would allow the Idaho Legislature to call itself back into session without the governor’s approval. It would take a simple majority of voters to pass Senate Joint Resolution 102.

Furthermore, voters will also be asked to vote on Proposition 1, the Quality Education Act ballot initiative. The initiative seeks to raise about $323 million per year for a new fund for public schools by raising the corporate income tax from 6% to 8% and creating a new top tax bracket at 10.925% for individuals making more than $250,000 per year and families making more than $500,000 per year.

In Hardy’s statement about a potential special legislative session, she made clear that Little said he plans to direct some of the surplus toward education funding and tax cuts — a potentially different approach that covers a lot of common ground with the Quality Education Act ballot initiative.

The Idaho Legislature could have several opportunities to push a different proposal than, or intervene in, the Quality Education Act, including during any potential special session or by trying to amend or repeal the Quality Education Act if voters pass it in November.