BOISE, Idaho (AP) - A Boise business is fighting a $6.5 million tax incentive by the state for a technology company planning to expand to the city, saying the break could help the new competition lure his workers away.
Employers Resource CEO and owner George Gersema said in court Wednesday that Illinois-based Paylocity could use its reimbursed tax money to offer higher salaries than Employers Resource can afford, The Idaho Statesman reported (https://bit.ly/1T6H0N7).
Gersema said he also hopes his lawsuit will challenge the Tax Reimbursement Incentive the state created in 2015. The state recently awarded a $3.9 million tax incentive to the for-profit Idaho College of Osteopathic Medicine planned for Meridian.
“If this lawsuit is successful, it calls into question all of the tax reimbursements they’ve given, including to the medical school,” Gersema said. “The Legislature knows it has a problem, but they are trying to whistle past the graveyard and not deal with it.”
The incentive repays qualifying companies up to 30 percent of their income, sales and payroll tax for 15 years. The companies must meet certain job-creation and wage numbers to receive reimbursement.
“This is just bad public policy,” Gersema said. “This is not how we should treat taxpayer money.”
Paylocity is expected to create 551 jobs with an average salary of $46,200 a year in exchange for the tax break.
The lawsuit names Idaho Department of Commerce Director Megan Ronk as a defendant and says the constitution grants the Legislature alone the power to determine how to use tax dollars. The Department of Commerce runs the incentive program. Ronk declined to comment.
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Information from: Idaho Statesman, https://www.idahostatesman.com
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