Opinion: The Victory in Idaho

By Paul W. Sudmeier

resident, Idaho Motor Transport Association

The recent elimination of the ton-mile tax in Idaho is the best example of what is possible when a state trucking association and the American Trucking Associations work together in their classic roles as members of the federation, delivering fair and legal taxes for the people who run trucks for a living.

No way the Idaho Motor Transport Association could have done this by itself. Neither could ATA have killed this tax by itself. Understand that ATA would not have come to Idaho without specifically being invited by IMTA’s board of directors. And ATA could not have done the masterful job it did without intensive assistance from IMTA staff and members.

Legally, what occurred during IMTA’s challenge of the ton-mile tax is on the public record. I would like to add a few notes.

The ATA Litigation Center did not get involved in this issue for the money. Its role was to help IMTA create leverage in repealing the ton-mile tax — Idaho was one of only five states to hang on to this unfair, onerous tax. After suit was filed against the tax in 1997, ATA twice offered to walk away if the state legislature would replace the tax with a new truck-registration system. And after the final verdict in February of this year, ATA could not have settled for less without running afoul of class action and intervenor considerations. It was the Idaho Legislature that made the decision to roll the dice in court. The decision cost the state $27 million that it could have handily avoided if certain players had assessed their situation more realistically. As a result, those who lost a 40-year cost advantage under the old system are sorrier for it. But the legislation, passed as part of the court settlement, truly accommodates a great number of low-mileage users. Those who lost an advantage would be well-advised to revisit then-Gov. Phil Batts’s State of the State 1998 address:

“ . . . Our weight-distance tax on truck has long since grown obsolete. Only a handful of states still use it. Ton-mile is widely evaded, and therefore, discriminatory to those who faithfully pay it. It creates reams of paperwork for truckers, large and small alike. Action to change this major tax contributor to a more equitable system is sorely needed.”

As a result of the ensuing tax battle, IMTA is faced with the challenge of rebuilding its broad-based representation within Idaho. We have come to be perceived as the trade association of the long-haul, high-mileage, out-of-state-based trucker. What an irony. Out of IMTA’s 215 carrier members, only two are from out-of-state, and they have no employees or facilities in Idaho.

Our trucking industry was ripped apart in this fight because each of our boards of directors over the years believed strongly that Idaho should be a state where highway transport could take place without one group subsidizing another and where the systems conformed to the modern standards of the International Registration Plan and International Fuel Tax Agreement. The beneficiaries of IMTA’s accomplishment are companies that, in most cases, have never sent a dime to this association. But we are going to need a lot of help now and in the future years to defend against inevitable counterattacks and to reunify the industry in Idaho.

In this regard, I have a few words for truckload carriers. I have heard several of their leaders say they do not think there is any need to support state trucking associations where they operate so long as they belong to the association where they are based. Their assumption is that if all carriers did the same, then all state associations would be well-supported. Their less-than-truckload brethren figured out long ago that this is not a valid assumption. State trucking associations need the support of all carriers that operate within their borders. Landmark cases like the elimination of the Idaho ton-mile tax won’t come along every year, but state trucking associations need the stability to be alert to danger every year. In the case of the Idaho Motor Transport Association and ATA, we have earned your loyalty for many years to come.