Idaho State of the State Address 2001

01/08/2001
Following is the full text of Gov. Dirk Kempthorne's State of the State Address, delivered on January 8.

Mr. Speaker. Mr. President Pro-Tem. My fellow Constitutional Officers. Distinguished members of the Legislature. Distinguished members of the Supreme Court. And my fellow citizens of Idaho.

Let me acknowledge a significant anniversary. On this date 50 years ago, Secretary of State Pete Cenarrusa took the oath of office in the Idaho House of Representatives.

As Charles Dickens said in A Tale of Two Cities, it is the best of times, and it is the worst of times. He was describing England in the 1700s. This also might appropriately describe Idaho today.

Let me tell you some of the best things that are happening in Idaho. The Federal Reserve Bank of San Francisco ranks us fourth in the nation for job growth. We're projected to outpace the nation's rate of employment growth in each of the next four years. For the first nine months of the past year, the value of Idaho's exports was more than $2.6 billion - a 56-percent increase over the same period a year earlier. The most recent federal figures show that 104 patents were issued for every 100,000 Idahoans - a rate that's three times the national average. The latest figures from Dun and Bradstreet credit us with having the second highest rate of increase in business starts in the nation.

So it's no wonder, then, that when the nation is measuring up which states are performing, they're keeping an eye on Idaho. Forbes Magazine ranks Boise as having the fifth best regional economy in the nation. And the American Electronics Association ranks Idaho as the seventh fastest growing high-tech state, and Boise as having the second fastest growing small cyber-city in the country.

This summer, the Western Governors' Association will hold their annual conference in Coeur D'Alene. As the new chairman, I chose Coeur d'Alene specifically because I want to show the region and the nation what we already know --what an outstanding place northern Idaho truly is. And next year, we'll get to showcase what a wonderful state capital we have to all 50 governors, when the National Governors' Association holds its annual meeting here in Boise.

We're home of the Humanitarian Hall of Fame, where outstanding people like Rafer Johnson, Chi Chi Rodriguez, Mary Lou Retton, and Kirby Puckett come to Idaho and fall in love with our great state and great people. We had the fourth Humanitarian Bowl, where our Boise State Broncos were repeat champions. And parenthetically, 30 percent of the bowl games that were played were in cities where the weather conditions were worse.

The work of our state government is receiving national recognition as well. Our state's web portal - Access Idaho - has been cited by the Council of State Governments as being the best in the nation. Our Commission on Aging's efforts to help more senior citizens stay in the workplace has been recognized as one of the very best in the nation. Idaho's implementation of welfare reform has just been recognized by the federal government as being the best of all 50 states in helping more people move off of public assistance and into the workforce. And that brought with it a bonus payment of one and a half million dollars. Our gain-sharing program in PERSI has paid substantial dividends. This month, it will mean an additional benefit check for retirees. For 53,000 public employees in the state, it will provide them with their own personal 401-K Plan. For all public employees, the average amount for their 401-K will be about $1,100. And for a teacher, the average amount will be roughly $1,600. And on top of all of that, we have a budget surplus that stands at more than $300 million. We can take pride in these accomplishments. But we have many challenges facing us as well. The unemployment rate in 33 counties went up between December of 1999 and December 2000. Five counties are still facing double-digit unemployment rates. In one of those counties - Clearwater County, where the Jaype Lumber Mill closed - the unemployment rate last fall ran as high as 22 percent. Our farm communities are suffering. This year the federal government distributed a record $28 billion in direct payments to the nation's farmers, accounting for half of total farm income. There continues to be increased levels of financial stress for farmers due to low agricultural commodity prices. Dairy producers suffered through one of the worst years in recent memory. For most of the year, prices were $1.00 to $2.00 below break-even standards. Potato prices are down substantially. More than 3,000 acres of beets froze in the ground in the Mini-Cassia area, and bankruptcies are very likely. In the mining industry - in our negotiations to settle on the Coeur d'Alene Basin cleanup, one of the difficulties is that if the federal government gets too tough and demands too much, they'll put the mining companies out of business.

And on top of all of that, we face some sobering social statistics. Experts say that if children can't read by the end of the fifth grade, they lose self-confidence and self-esteem, making them more likely to enter the juvenile justice system. Of the kids that are currently in custody in juvenile corrections, 2 out of every 5 require some form of mental health services. Many of these children were child protective cases. Once they reach 10 or 11 -- and once they start acting out and getting violent - they're much more likely to go out the door of child protective services and walk through the door into the juvenile corrections system. If you look at the highest risk young girls in juvenile corrections, most come from single-parent homes. And one out of every ten births in this state is out of wedlock. Most girls in juvenile corrections come from homes where alcohol and drug abuse by one or both parents is a way of life. Eight out of every ten of them say substance abuse was a factor in their criminal behavior. Seventy-five percent of the female inmates in our correctional system have dependent children - hundreds of children whose mothers are behind bars, and there's no father in the picture. And one of the reasons for the growth we've seen in the state's foster care caseload is that more single mothers are being incarcerated.

So with this mosaic of successes and challenges, I present this State of the State.

Let's start with the surplus. In that discussion that we just had about the positive things happening in Idaho, make no mistake: we have created a positive atmosphere that has generated a surplus. This is not a problem. This is a great success story. So let's acknowledge it. On Wednesday, I will give you the details of my budget proposal. My budget package recognizes where this money came from in the first place. And that's the hard-working Idahoans who pay taxes. Therefore, I will recommend to you tax relief in the amount of $140 million. A portion of that is permanent. A portion of that is one-time. And just as we did this year, if the surplus continues, we can continue to provide significant tax relief next year. In that $140 million, the categories of tax relief will be individual income tax, corporate tax, investment tax credit enhancements and broadband connectivity geared toward our rural areas. There will be an increase for senior citizens in the grocery tax credit, and I am recommending that for young families that the childcare tax deduction become a tax credit, and an increase in the allowance on elderly dependent care. We will have for the first time research and development tax credits. It is a well-rounded, inclusive program. But I believe that just as our President-Elect George W. Bush, has indicated, if you suspect a recession, one of the best things you can do is to cut taxes and put it back into the people's pockets so that they can generate the economic activity to create more jobs. You will also see that a significant portion of this surplus will go toward a much-needed backlog of buildings at our institutions of higher learning. A portion of it has go to supplementals, such as education, health and welfare, corrections, firefighting and other items. But I have remained mindful of keeping the expansion of the base in check.

Let's turn to education, and reading. We can affirm that 86 percent of Idaho's population has a high school diploma, and the national average is 84 percent. However, there's still work to do. In addition, we also know that from our most recent test scores, only 50 percent of Idaho children are reading at grade level by the third grade. This makes the Reading Initiative critical to Idaho. We know we are making progress because we have defined a benchmark, we've taken a measurement, we have outstanding teachers involved, and there's a synergy out there. We know the mission. We should lay out further goals.

If our third graders are at 50 percent today, we should all agree that one-year from now, 60 percent will be reading at grade level. And the following year, 70 percent. 80 percent the next year. And by the end of 2004, 90 percent of Idaho's third graders will be reading at grade level. And we're going to combine this focus with a renewed emphasis on math. Just last month, the latest round of international math tests were released by the federal Department of Education. The results: our nation's eighth graders were outperformed by their counterparts in 18 nations. The list of countries ahead of us is very interesting: Singapore. Korea. Taiwan. Hong Kong. Japan. Belgium. The Netherlands. The Slovak Republic. Hungary. Canada. Slovenia. The Russian Federation. Australia. Finland. The Czech Republic. Malaysia. Bulgaria. Latvia.

Seven of these countries are Idaho's top ten export countries. How long are you an equal partner when you're not able to keep up? Because also included are those who would just as soon take over our markets where we're currently providing the technology and the manufacturing. And here in Idaho, last year's results from our Direct Math Assessment showed that 55 percent of our eighth graders did not achieve a "satisfactory" rating. That should not be a cause for laying blame because we did raise the bar on standards. But it does serve as a call for action.

So we're going to launch the math equivalent of the Reading Initiative as our next phase. And we're going to do it just as aggressively. I've had numerous meetings with industry leaders, and they are prepared to be partners in this. And I would also request of legislative leadership that you appoint as part of this team effort some of the very same individuals who played a key role in helping develop the Reading Initiative. And Dr. Howard will be integral to this, just as she has been with the Reading Initiative.

I've been encouraged by how many math teachers, as well as science teachers, have said to me that they welcome this new emphasis. And ironically, we have a number of our teachers who are teaching this discipline and it was not their major. It wasn't even their minor.

We also know that we're going to need to bring new teachers into this equation, because others are retiring. And so in concert with industry, I have placed in the budget $6 million, so that we will have the opportunity for signing bonuses. This will enable us to attract and retain excellent candidates in math and other disciplines while also fostering mentoring programs. We're going to mobilize the talented forces of our education community. We will take this step by step. We will continue our emphasis on reading and math. And we will see our students improve. My goal is to have 90 percent of Idaho eighth graders achieve a "satisfactory rating" by the end of 2004.

National Board Certification will continue. Idaho currently ranks ninth in the nation, with 209 teachers who have received National Board Certification, and another 73 teachers will take the test in the coming year. On a per capita basis, we rank third. Guess what we're doing? We're providing incentives. We're paying these teachers $2,000 each year for the next five years once they become board-certified. In addition, I have included in this budget a salary increase for teachers. And the public education budget, for the second year in a row, approaches an historic proportion of increase - no matter how you want to factor it.

If you want some good reading at some point, I would encourage you to read this - the list of the innovative grants we've awarded -- and look at what the teachers of Idaho can do. They said that if you gave us a few dollars, we can do innovative things. They've been doing it. And guess what? They did it in a classroom where we gave them an additional $500.

I support and I believe in charter schools. In essence, what we have created with this program in schools throughout the state are charter classrooms for $500 each. That's pretty powerful. And here's why it worked: we encouraged innovation without a guaranteed result and without penalizing failure. We said, "go try it." And that's the atmosphere. And there are other rewards in this budget. But I will say that with rewards go accountability and measurement and consequences. If we don't attain these levels in reading and in math, then we must be prepared to take further actions. The world is changing rapidly, and we need to be able to change and adapt just as rapidly, and these charter classrooms I referenced are a perfect example.

To our credit, in 1999, 97 percent of our schools had Internet access. So let's further encourage innovation among our fine teachers and that entrepreneurial spirit that defines Idaho. In 2005, we must and will have standards in place for our students. I have had high school students ask me: "do you believe that there should be exiting standards?" And I tell the students: "absolutely". If we were to tell them those standards would be applied in six months, that would not be fair. But if we tell them in junior high to be ready by the time they are a senior in high school -- that's fair. And I'm going to suggest to you that we no longer use the term "exiting standards" with regard to these students. These are achievement standards.

A model that I'm suggesting to the State Board of Education is similar to the SAT format, where a student who does not succeed on the first test will have the opportunity to study further and then take it again. In fact, you may have three bites at the apple. And there's no penalty if you take the test again. In fact, maybe you've already passed it, but you'd still like to take it again and improve on your scores. But our students are going to know what's necessary for graduation, and they will have to pass the test to receive their diploma.

Did you know that in the United States today, 1 in 5 high school graduates cannot read their diploma? We will prepare our young people for graduation and, in so doing, for a bright and successful future. I will use the term "exiting standards" in a different context in a moment.

I referenced earlier the PERSI program and what we did with the employees' share. Now I will tell you what I believe we should do with the employer share in public education. In K-12 education, we know that there are still life-safety issues. $34 million of the employers' share of PERSI gain-sharing should be spent in our K-12 schools on life-safety issues. I want to complement our State Board of Education. These are outstanding members. They do it at no pay, but they do it with a lot of sacrifice because of their passion for good education. And I'm going to use this occasion to single out one member of that state board, the newest nominee, General Darrell Manning. Someone who has served four governors, he has probably been the head of more departments than any other public servant, and received the only award for Distinguished Service to State Government last year from the National Governors Association. He reflects the type of quality citizens serving our students.

Higher education in Idaho is still one of the most feasible and least expensive educations anywhere in the region. With the exception of Nevada, Idaho's combined tuition and fees are the lowest of any western state. We continue to be one of the best bangs for the education dollar, and we want to continue that. This Legislature came forward last year with legislation to establish Promise Scholarships. I signed it into law. The only thing missing were the dollars. Not anymore. In my supplemental request, I recommend $3 million, and in the ongoing budget, I recommend $3 million. Now that's an incentive for our kids to do well in school by offering them a $500 bonus at high school graduation to further their schooling in Idaho.

We've also addressed the aspect of recruitment and retention of our professors in higher education in highly competitive fields. I thank the Legislature for supporting my recommendations in this. And I can tell you that over the past two years, we've received an overall 2-to-1 return on investment - and in some individual cases, as high as a 4-to-1 - in terms of how the universities have been able to leverage the money with outside sources of funds. Recently, on the northern Idaho legislative tour, you saw proof of this success at the University of Idaho when you visited with the computer security researchers. Those professors have been heavily recruited by other out-of-state universities, and without your support, they might not be there today. Some of you were also able to visit the new molecular ecology and genomics laboratory that also received support. In partnership with the INEEL, the funds were used there for a distinguished professorship in biotechnology, five graduate students, a PhD-level lab manager, and state-of-the-art equipment to create the only lab of its kind in the state. I also have met with the faculty senate chairs, and they too have raised the issue of the competitive nature. We all believe in the marketplace. If you have a successful professor who is offered more, then that person may move on. But I ask you: how long can you say you're going to have the best educators if you see them leave? Therefore, for the first time, I'm recommending to you the category of salary equity for faculty at our institutions of higher learning.

So we have our children prepared. We have them through college or professional technical education, and now let's get them to work. That's why all of the committees and task forces I appointed last year have been developing recommendations to improve economic development throughout the state. I said that in this administration, we'd involve people like they've never been involved before. And I thank all of those citizens for their dedicated, outstanding contributions to furthering the State of Idaho. I appointed a Rural Development Task Force - 65 people from all areas of the state - to suggest how to stimulate the rural economy. They said you can't attract a business if you don't have the roads and sewers. Therefore, they recommended that rural Idaho needs to have state block grants for infrastructure. It's now included in the Budget. They recommended that we increase the Gem Communities Program, which provides economic development training and planning for our rural communities. It's in the budget. They called for a matching program, that we would match dollar for dollar, with local or regional communities in providing economic development assistance. It's in the budget. They recommended a statewide coordinator for grant writing, someone whose sole purpose and sole focus would be on rural Idaho. It's in the budget. I want to especially thank the chairman of the Rural Development Task Force -- Pete O'Neill -- and the three co-chairs --Kenlon Johnson, Con Paulos, and Steve Meyer - for their work.

We also created a Science and Technology Advisory Council, chaired by Idaho's first Science and Technology Advisor, Dr. Billy Shipp. Because of the work of this Council, Idaho now has a strategic plan for science and technology. That report will be released later this week. And when you see it, go down the roster of the 28 who served. This is a group of individuals any state would boast of - but they're ours. The council recommended establishing a non-profit, public-private corporation to oversee the implementation of Idaho's science and technology strategic plan. It's in the budget. They recommended $2.6 million for faculty at our colleges and universities, to increase the number of graduates and provide increased professional education in areas of science, engineering, health professions, and law. That's in the budget. They recommended higher education research focusing on the north Idaho business park, to be matched dollar-for-dollar from outside of government. That's in the budget. And once again, a public-private partnership will be established.

Our new 16-member Advisory Committee on International Trade, led by Jim Hungleman and Charlie Pottinger, was activated. This Committee is working to develop a strategic plan to expand Idaho's trading opportunities. We are making progress.

When I took office, I challenged our Departments of Commerce and Agriculture to double the value of Idaho's exports by the end of 2002. Since January of 1999, we've seen a 61-percent increase in export value - more than a billion dollars. Let me quote from a recent Kiplinger Letter: "Figure on 8 percent growth in agricultural trade surplus in the year ahead. Result of farm export values rising by $2 billion to $53 billion in 2001, topping the expected value of agricultural imports by around $13 billion. Thank Canada, Mexico, and Asia for the improvement in ag sales."

Guess where our trade missions during the last two years have been? Canada. Mexico. Asia. Instead of just now showing up on their doorstep, we've already been there. And we literally have kicked open the doors in these markets. We have the finest foods, products, manufactured goods and high-tech equipment of any state in the nation. And other countries are recognizing that.

And since we're talking about agriculture and our farm communities, they must be full partners in our rural recovery. Last year's bankruptcy of AgriBioTech -a $110 million enterprise - ought to be proof enough that the status quo isn't satisfactory. That's why I've appointed a Family Farm Security Task Force - 34 Idahoans, representing a cross-section of our ag community - to review our laws and regulations and determine how best we can improve conditions here at home. In my budget, I will recommend some one-time tax relief to help our farmers and ranchers.

If we are talking about agriculture, we must also discuss the issue of minimum wage for farmworkers. This past summer, our Labor Department conducted a survey of farm worker wages. Their findings: less than one percent of farm workers in Idaho receive less than the minimum wage. Last September, I told the interim committee that the time had come to move forward and enact a minimum wage for farm workers. I came to that conclusion not because of that survey. But because I personally went out and talked with farm workers. I went to their work sites. I was invited into their homes. And I listened to them. The interim committee's recommendation will be before the legislature this session. The time to act is now, and I renew my call for this proposal to be adopted.

In all of the products we produce -- whether it's ag products or high-tech components -- we should have as many steps in the processing and manufacturing of the end product taking place within our borders as possible. And that's what the value-added task force is continuing to develop, with Larry Eastland chairing that able team.

Another group of Idahoans I've brought together is the Governor's Coordinating Council for Families and Children. This past year, we held a workshop for people from throughout the state who have a passion for Idaho's families and children. More than 400 people came together and worked for two days to share ideas and set objectives. From that group, I selected 45 individuals from across the state. These individuals come from a variety of backgrounds and disciplines -- including doctors, teachers, clergy, judges, media executives, counselors, parents, and parent advocates. All of these people have dedicated their personal time to make Idaho the best state in the nation to raise a family. They will share success stories from across the state and work to create the foundation for the Generation of the Child.

The well-being of our children -- getting them off to a strong, healthy start - is imperative for the state's future. Dr. Jerry Hirschfeld and my wife, Patricia Kempthorne, are guiding this effort with their wonderful passion for kids. We said we would establish a voluntary statewide immunization registry, so that we can raise the rates of immunization for our youngest children. And we've done just that. We took that concept and made it reality in just over a year's time. Today, IRIS - our Immunization Reminder Information System -- is fully operational today and connected statewide. And already, we're surpassing our expectations. Even before IRIS was up and running, we set a goal of having 30,000 Idahoans registered by the end of 2000. Today, more than 47,000 Idahoans are registered in IRIS, more than 370,000 vaccinations have been made, and we're on track to achieve a statewide immunization rate of 90 percent that I called for two years ago.

We're going to build on this success by providing the matching funds so that nearly 50,000 infants and toddlers can be immunized against pneumococcal disease. This disease causes 5 million ear infections a year in kids under age 5, and kids who are immunized are 20 percent less likely to need tubes inserted in their ears because of chronic ear infections.

We're also going to continue our efforts to keep our children away from tobacco. When I stood before you last year, I asked that the Legislature establish a trust fund for our tobacco settlement proceeds. And I said that the first call on those dollars ought to be for health advocacy. I want to commend the Legislature once again for taking swift action to pass the Millennium Fund bill and make it the first piece of legislation I signed into law last year. And I also commend the Legislature for ensuring that the first installment, $2.3 million, was dedicated to measures aimed at reducing tobacco use. My budget will continue this effort by proposing expenditures to keep Idahoans - especially our children - from using tobacco in the first place.

We're also committed to addressing the needs of children with serious emotional disturbances. Many of you are familiar with the so-called "Jeff D." case - a 20-year-old lawsuit that this Administration inherited. Recently, Judge Winmill suggested that Idaho was not adequately addressing the issue of children's mental health. To set the record straight, here's what we've been doing. We've pulled together all of the agencies and groups that have a role in assisting these children and their families -including Health and Welfare, Education, and Juvenile Corrections. We identified what services were needed. We coordinated our efforts.

Last year, we established three demonstration sites in the state to begin developing community-based mental health services. And we have allocated the money to move this effort forward. Since 1980, funding has continued to increase to today's total of $25 million on services for these children. The budget I will send you Wednesday increases that to more than $31 million. And when you combine it with the federal funds that are matched by those state dollars, the total is more than $94 million. We have a good story to tell. And we're doing this not because a court told us to do it, but because we believe it's the right thing to do. It is motivated by our desire to do what's right.

All of these efforts are an investment. It's an investment in our children, because those children then become our adult population and before we know it, they will become the decision-makers. If we don't get them off to a healthy and well-educated start, the path for too many young people can become one of incarceration.

In Idaho, we are continuing to fight the increase in the manufacture, trafficking, and use of one of the most devastating drugs we've ever faced - methamphetamine. I want to thank the Legislature for joining me in this effort to target methamphetamine, because we're making a difference. This past year, we shut down 176 meth labs across the state. Colonel Ed Strickfaden will tell you that our continued success is due to community outreach, public education, and greater collaboration between federal, state, and local law enforcement - all made possible by your support of my meth initiative. I will not back down from this strong stance against meth. In fact, I propose that we increase the manpower in our state police this year to further our fight.

Let me take this opportunity to thank and salute the men and women who wear the law enforcement badge. This past week, we lost two of our finest in Jerome County while they were serving a drug warrant and defending the state they loved -- Corporal James Moulson and Corporal Phillip Anderson. We mourn the loss of two heroes, we grieve with their families, and we honor their service. Whether you are a state trooper, a sheriff, a policeman, or a correctional officer, know that Idaho stands behind you. We will continue to support our law enforcement professionals, and we will hold those who commit crimes fully accountable for their actions.

If we are to be successful in our fight against drugs, we can't fight it on the supply side alone. We have to address the demand side as well. And that means addressing the issue of substance abuse. On a per capita basis, Idaho now has the fastest growing inmate population of any state in the union. 13 percent, compared to the national average of 3.4 percent. And of the 5,000 prisoners in our prison system, 87 percent of them have a substance abuse problem. Based on the fact that our prison population is growing at its current rate, I have received a recommendation that we should begin a construction program of a new prison every two years for the foreseeable future. And I had to consider that very seriously in preparing my budget. But I concluded that if simply warehousing people is our solution, then we as a society have failed. Therefore, I do not recommend the construction of a new men's prison in this budget. I do, however, recommend that additional beds be constructed at the women's facility in Pocatello, which currently is at full capacity. And every new bed constructed there will be devoted to substance abuse treatment.

Right now, for those inmates who need long-term substance abuse treatment, we can offer it to only 30 percent of the prison population. I will propose to you in the budget that we increase that treatment to 80 percent. We're going to deal with the problem of substance abuse in the prison population, and stop the revolving door of returning inmates.

I want to tell you a story from when I was at one of our prisons. I was on a pre-set tour, but you couldn't help but see the other cellblocks, and they can't help but see you. And on a number of occasions, inmates beckoned me to come in. I asked the warden if we could do so. He said: "it's your call". I did so. I remember going up to one particular prisoner, and without giving you his description, I realized this man could hurt me. But I shook hands with this man. And he said: "I know you're trying to get treatment programs in here, and we want to thank you. Because that's our only hope in life."

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