MY TURN: Why does Idaho’s resort-city tax law still exclude Coeur d’Alene?

Coeur d’Alene is one of Idaho’s best-known tourism and recreation destinations. Yet state law denies its residents a choice already available to voters in other resort communities.

Idaho Code Section 50-1044 allows qualifying resort cities to ask voters to approve local-option nonproperty taxes on lodging, alcohol sold by the drink, or some or all transactions already subject to state sales tax. Any proposal requires 60% voter approval.

But Coeur d’Alene cannot even ask the question because the law applies only to resort cities with populations of 10,000 or fewer.

The legislative history does not clearly explain why lawmakers ultimately selected the 10,000-person cap. What is clear is that both the original framework enacted in 1978 and the amended version adopted in 1981 excluded Coeur d’Alene.

The original idea for the local option tax started with former Ketchum Mayor Gerald N. “Jerry” Seiffert and resulted in the City Property Tax Alternatives Act of 1978. Its purpose was to reduce the burden on property owners who paid for municipal services also used by tourists and other nonresidents.

By 1995, the Association of Idaho Cities was asking lawmakers to remove the population restriction. Its executive director, Scott McDonald, was quoted as saying the 10,000-person limit had been “designed to exclude Coeur d’Alene.”

More than 30 years later, that exclusion remains.

Consider the revenue generated in smaller resort cities. McCall, with roughly 3,700 residents, estimated it collected $3.7 million from its local-option-tax for 2025. Sun Valley collected approximately $2.88 million in 2024.

Those figures do not establish exactly how much Coeur d’Alene would collect. That would depend on the type of tax, its rate, exemptions and taxable activity. But they demonstrate that local-option taxes can provide meaningful revenue for public services and infrastructure.

I am proposing a focused amendment to Section 50-1044. It would remove the population cap and change the resort-city definition from deriving “the major portion” of its economic well-being from tourism and recreation to deriving “a major portion.”

That wording already appears in Sun Valley’s current city code. It recognizes that tourism can be a major part of a city’s economy without being its single largest industry.

The amendment would not impose a tax or establish a tax rate. It would only allow a qualifying city to present a specific proposal to voters.

The ballot measure would still have to identify what would be taxed, the exact rate, how the revenue would be used and how long the tax would remain in effect. It would still require 60% approval.

If voters oppose the proposal, they can reject it.

This issue is especially relevant as Idaho considers major property-tax changes. The Idaho Republican Party’s 2026–2028 platform directs the Legislature to eliminate property taxes on owner-occupied residences before the 70th legislative session.

That is a party position, not an enacted funding plan. But it demonstrates why alternative local revenue tools deserve serious discussion.

Tourism provides enormous economic value to Coeur d’Alene, but it also increases demand for streets, parks, police, fire and public infrastructure. A carefully designed lodging or visitor-oriented tax could capture part of that spending, fund specific services and reduce pressure on property owners.

Existing law also provides important safeguards. Voters control the tax, rate, purpose and duration. If collections exceed the amount budgeted, the excess must be placed in a city property-tax-relief fund and used to replace city property taxes in the following fiscal year.

The Legislature would not be voting to tax Coeur d’Alene. It would be voting to let Coeur d’Alene residents consider an option already available to other resort communities.

A city does not stop being affected by tourism when its population passes 10,000.

If the rate is too high, the scope too broad or the purposes unclear, Coeur d’Alene voters can vote no.

But Idaho law should not continue making that decision for them.

Remove the outdated population cap. Preserve the 60% voter requirement. Let Coeur d’Alene voters decide.