Committee debate on House Bill 325 stalls; Idaho Housing and Finance Association warns oversight could affect bond authority

House Bill 325, which would make new federal grants to the Idaho Housing and Finance Association (IHFA) cognizable under the legislature’s appropriation process, generated extended testimony and debate in the House Appropriations Committee. After two roll-call motions with differing outcomes, the committee retained the bill in committee.

Representative Cornel Rasor introduced HB 325 as a transparency measure to bring federal grants received by IHFA under JFAC’s oversight, citing precedent that treated some ARPA funds as cognizable. Brady Ellis, executive vice president of IHFA, testified in opposition. Ellis said IHFA is a statutorily independent public body that receives federal grants directly and that including those grants in the state appropriation process could blur IHFA’s independent status, risk its bond-financing structure and potentially affect credit ratings. “Having federal grants made directly to IHFA included in the state's budgeting and appropriation process… blurs IHFA's independent structure and would likely adversely impact its bonding activities and may impact the state's credit rating,” Ellis said.

John McDevitt, IHFA general counsel, explained the concern further: treating IHFA operations as subject to legislative appropriation could cause rating agencies to view IHFA as a component of the state and raise constitutional and rating questions related to Article 8 (debt limits).

Committee members debated the bill’s intent and practical effect. Representative Tanner and others argued the change would provide oversight and transparency for federal funds flowing to an entity created by prior legislatures. Opponents warned the bill would subject funds that do not pass through the state treasury to appropriation and could set a precedent affecting other entities.

Two motions followed. Representative Petzke moved to hold the bill in committee; the motion was up for roll call and failed on a 5-5 tie. Representative Tanner then moved to send the bill to the floor with a due-pass recommendation; that motion failed on roll-call 4-6. The chair announced the bill will be retained in committee.

IHFA told the committee it annually applies for and receives federal grants and cited regular federal oversight and audits; testimony noted IHFA administered ARPA-funded workforce housing funds held in the Treasurer’s custodial accounts but said those funds were never appropriated to IHFA.

The committee did not advance HB 325; the bill remains in committee for further review.