It was a wonderful experience to represent you in the Idaho Legislature again this year. It was a unique year with extraordinary challenges resulting in the longest legislative session in Idaho's history. For the second year in a row, the state's budget woes were the top issue. I got a first-hand look at the problems, serving on the powerful Joint Finance-Appropriations Committee (JFAC) which sets the budgets for all state departments and agencies, including Health and Welfare and Education. We looked under every rock and around every corner to identify inefficiencies and reduce government spending. Government agencies were reduced substantially and services eliminated. Some of the cuts were healthy; some of them were injurious, but all were necessary under the current economic conditions.

Although Governor Kempthorne announced the need for a tax increase in his State of the State address at the beginning of the session, it took three months before the Legislature okayed a one cent sales tax hike. Massive cuts to education, services for the aged and disabled, drug courts, and our prisons were averted by the tax increase that is scheduled to sunset on June 30, 2005. Proper financial planning and stringent spending constraints will need to accompany an improvement in our economy to insure the expiration of the penny sales tax.

Tort Reform
After years of planning and negotiations and very heavy lobbying on both sides, Idaho's first major tort reform bill in 15 years was passed this session. The new law will probably not reduce the current cost of liability and health insurance, but it does restore fairness and predictability to the legal process, helping hold down future increases in insurance costs. A September 2002 study done by the U.S. Department of Health and Human Services reported that liability premium increases last year averaged 12% in states with caps, and 44% in states without caps. Everyone in society has been held hostage by outlandish damage awards that have occurred in other states-driving up the costs of everything from medical care to the price of automobiles. This bill won't solve all our problems, but it will make significant improvements that will help businesses, the medical community and others who wrestle with the problem of rising costs and insurance availability.

Protecting Idaho Businesses
With employers in Idaho facing 100% to 300% increases in their unemployment insurance (UI) taxes, we placed a freeze on the UI tax rates for two years. This action was taken only after extensive analysis to insure the stability of the UI Trust Fund.

Pro-Taxpayer Bill
A bill designed to "level the playing field" between county assessors and taxpayers appealing their property appraisal came through the Local Government and Taxation Committee that I vice-chair and was approved by the Legislature. The new law reduces the unfairly difficult standards taxpayers have had to meet in the past, reducing the burden of proof from "clear and convincing" to a "preponderance of the evidence."

Tax Conformity
One of the tragedies of this session was the Legislature's failure to make its annual adoption of federal tax laws. For the first time in 45 years, Idaho divorced itself from the federal tax provisions, forcing Idaho businesses to keep two sets of books and depreciation schedules from now on. Although I was successful in persuading the Senate to elect full conformity, the House of Representatives failed to concur.

Public Safety
A state-wide Amber Alert system was initiated by the Legislature to assist in locating abducted children in the early hours after abduction and keep public awareness at high levels as time goes on. In a move to protect our citizens from sexual predators, we also enacted laws requiring the posting of photos and addresses of violent sex offenders in local newspapers when they move into our community. We also made it a felony to use the Internet to lure a child to engage in a sexual act. Finally, we made it more difficult to obtain date rape drugs and expanded the Idaho Drug-Free Workplace Act to include public employers.

Sometimes the best thing I can do for those I represent is make sure a bill does not become law. Here is some of the legislation we were able to block:

• We prevented the repeal of the early retirement incentive for public school teachers.
• We rejected rules promulgated by the Department of Environmental Quality that would have imposed unreasonable restrictions on our citizens.
• We thwarted attempts by the AFL-CIO to repeal Idaho's Right-to-Work law.
• We stopped a bill that would have required Idaho taxpayers to make estimated tax payments on a quarterly basis.
• We once again resisted the temptation to make not wearing a seatbelt a primary infraction, leaving the primary responsibility with you and your family to buckle up.
• We rejected scores of bills that would have limited our freedom, usurped local control, or generated bad public policy.

Idaho is consistently recognized as one of the best-managed states in the nation. Because of the prudent financial and policy decisions of our state government, Idaho maintains the highest possible bond rating available. This preferential bond rating not only saved the state almost $1 million in interest this year, but also allowed local municipalities and public schools to take advantage of lower interest rates.

Thank you for allowing me the great opportunity of serving you as we confront these important issues. Together we will continue to make Idaho a better place to live, to work, and to raise our families.

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