BOISE, Idaho (AP) - The Idaho Supreme Court restored a lawsuit against the state over a tax incentive program for new or expanding companies.
Employers Resource Management Co. of Boise sued the state in 2016 after officials gave a tax incentive to Paylocity, an Illinois company and competitor establishing a new office in Idaho, the Idaho Statesman reported.
Idaho agreed to refund Paylocity $6.5 million in income, payroll and sales tax over 15 years.
Employers Resource Management Co. Founder and CEO George Gersema thought it was unfair that state officials gave such an advantage to a competitor.
“Not only does Paylocity get my tax dollars, now I have to compete with them for employees, since they do much of the same kind of work I do,” he told the Statesman in January 2016. “Well, gee whiz, thank you, Legislature of the state of Idaho. Thank you very much.”
Two months later, he sued Idaho Department of Commerce Director Megan Ronk. A district court judge dismissed the lawsuit, saying Gersema’s company didn’t have standing to pursue it.
The Supreme Court unanimously ruled that’s not the case.
“In our view, increased competition - so long as it is on a level playing field - does not provide a basis for judicial intervention,” the court’s opinion states. “That is not the case, however, when there is governmental action that alters the competitive landscape by providing an advantage to an economic competitor.”
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Information from: Idaho Statesman, http://www.idahostatesman.com
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