Republican Julie Ellsworth is running for her second term as Idaho State Treasurer. Her opponent, Democratic candidate Deborah Silver, declined Idaho Public Television’s invitation to debate.
This year we at Idaho Public Television, along with debate organizers nationwide, saw a number of candidates decline to participate in debates or fail to respond to our invitations in the first place. As Federal Election Commission rules say we cannot hold a debate with just one candidate, we’re allowing those who did qualify for the debates a chance to sit down with Idaho Reports for a one-on-one interview in which they can answer questions much like they would have received in a traditional debate setting.
Melissa Davlin, Idaho Reports host:
Treasurer Ellsworth, thank you so much for taking the time to join us today. First of all, why are you seeking reelection?
Julie Ellsworth, incumbent Idaho State Treasurer:
I love my job. I love being the State Treasurer. The Treasurer’s office is essentially the accounts receivable for the state. All the money that comes into Idaho, whether it’s through federal or local or state government, goes through the state treasury. It’s really an opportunity to manage it well and elevate the communities out here in Idaho. I love the job. I love working with Idahoans.
And, I’m thrilled with how the constitution got that you need to separate the treasury from the entity that spends the money. People often ask me, “Why do you need a treasurer and a controller?” The treasurer is the accounts receivable; the controller is the accounts payable, so he pays the bills. But we check and balance each other constantly, as a matter of fact. I balance, he balances, and we – there cannot be a discrepancy. I commend our founding fathers for seeing the great need for that division of power.
Should this be a partisan elected position, though, if you’re dealing with those checks and with the money?
I believe that it needs to be grounded in the constitution, and a constitutional race is partisan.
But the significance of having it in the constitution is that I answer to every Idahoan. It is not [answering to] another constitutional officer, listening to their will. These constitutional officers have very specific duties, and it’s really nice to know that there is a division of power so that other influences can’t come in with big opinions and meddle with it.
You mentioned that billions of dollars come through your office. Why should Idahoans trust you with this role?
I have had a track record of success. The first thing I did when I entered four years ago was, I created essentially a bubble chart showing the accountability for our dollars. You know, I want to see: the constitution says it should be done this way, then we have legislative laws. We have committees that oversee it. We have different paid professionals that that evaluate the different funds in the state. I have been successful in creating an accountability for the management of these dollars.
I feel like I am in a position that I can work closely with local units of government in the future, to elevate the Idaho Bond Bank Authority’s ability to lift communities. Since I’ve been in office, the state has received a triple-A credit rating. When I first started, I established that the bond rating agencies would call into our state and speak to lawmakers and different policymakers, so that they knew what it took to have good policies that increase your credit rating. I’ve done a good job, and I want to continue.
For Idahoans who don’t understand the role of that bond rating and how important it is, can you explain that to them?
Yes, the Idaho bond rating. Essentially, everything in government in the state of Idaho – if your local school district or local sewer district is bonding for an improvement – they’re just a little bond. It would be very expensive for them to sell that on the market. But by taking several local little bonds, entities that have bonding authority under Idaho law and combining those together, that’s what the bond bank does. We can combine it, create a larger product, sell it on the market, and then you get a better rate of return.
Now, they’re going to rate that based on what the credit rating of the state is. So, it goes down from there. Anything anybody does – even if we combine bonds, or you have your little bond – it’s going to be rated by how many degrees away from the credit of the state. That credit rating boils down to taxpayer dollars.
As an example, we refinance a lot of debt. A taxpayer is a taxpayer, [including] property taxpayers with local property tax debt. If we refinance it and bring down the cost of that debt, a community like Jerome could save – they saved, I believe, $1.3 million in interest savings. That goes right to the taxpayer. And it’s because of a good credit rating in the state, which helps everything down from there.
Over the past year you’ve spoken out against ESG – or environmental, social and governance factors – and your concerns about that affecting the state. And this isn’t specific to Idaho, but a nationwide conversation that’s going on. What role do you see the Treasurer playing in addressing this?
Environmental social governance is – I believe – a very arbitrary, non-democratic way for entities to come in and influence a rating policy of the state, by throwing in different criteria that has not been accepted by Congress or anything, just random.
And what are those criteria?
That is the question. You know, we can never get it written down.
This all started with me as a state treasurer about a year and a half ago, when the treasurer from West Virginia, Riley Moore, called me and he said, “Julie, they’re shutting down my state. We can’t get financing for our industries because we’re affiliated with oil and gas and mining, and the banks have just decided not to finance.” Okay, who decided not to finance? You look at financials. You know, you look at where did this decision come from? And that was the question about a year and a half ago. He said, “Will you join me in pushing back to these banks? We’re customers and we want to bank with you. Why are you boycotting us?”
So, I joined Riley Moore about a year and a half ago. There was 15 of us state treasurers [at the time]. There are now 27 state financial officers that have joined together and said, “Okay, these arbitrary terms that are canceling out industries, we find them undemocratic. We’re looking for people to bank with. We have among us about $3 trillion that we manage. Stop canceling us.” And that began the effort that has been quite a lot of activity. I’ve been working with Senator Crapo on making sure that these arbitrary requirements – Literally, it’s very difficult to get anything in writing. How does an industry gauge what they are to do, if you can’t even know by which standard you’re being canceled on?
A state treasurer is looking to bank with people. We’re a customer. We’re saying as state treasurers, “We want to bank with you. Bank with us. Don’t cancel our industries.”
Don’t the lenders have a right, though, to mitigate their risk management in any way they might see fit?
That’s always been part of the equation. It’s called a material risk. Within any analysis of lending money, that has been baked into it.
The problem we have is what, for example, Standard and Poor’s is trying to do. Again, you’ve always had risk analysis in all of these financial decisions. So, for it to be said now, “Well, what, you’re anti-environmental?” No. The environmental EPA standards and qualifications have always been baked into financial decisions.
What they want to do is they want to take this big matrix of what has been baked in for investments and financing, and they want to pull out just certain ones and say “These on the side we’re going to look at, too.” My opinion is, “Okay, if we’re going to start pulling out little things on the side to look at in our reports, why don’t we pull out that the state of Idaho pays off their debt early?” You know, let’s have that be a side report card and put that up against everybody else.
This particular effort with Standard Poor’s, you might remember that our entire leadership team in Idaho signed on to a letter to push back on that effort. Again, we have always baked in material information with environmental issues, or any of these issues that they’re trying to put to the side. When you discuss debt matters, it is wrong to make a separate report card. And so, we’re pushing back.
You had a high-profile fight with the Legislature recently regarding office space in the Capitol building, after lawmakers filed suit to evict you from where your office had been. It went in front of the Idaho Supreme Court. Did that dispute put you in a bad place to work with lawmakers in the future?
Not really. I’ve had very successful working terms with them. As a matter of fact, last session, Senate Bill 1405 was my bill, co-sponsored by a Senator and a House member.
I think that at any time in government, there are multiple issues. It just shows that, you know, you are never unanimous on all things. But I have really enjoyed working with legislators and I don’t think that has [diminished].
Was it worth the cost to the taxpayers that both the Legislature and your office spent for the lawsuit?
The issue on this was, “Are we going to grow government?” Are we going to create a full-time legislature by creating this space? We currently have space used by legislators for three months out of the year. The office space that I had used [as Treasurer] for 120 years was full-time. If you create space that really can be used full time, the concern was there would be a full-time legislature. And I was laughed out when I was pushing back on that, but then we have reason to be concerned about it.
Was it worth it, the office? It cost money to defend it. However, it’s cost over $10 million now that they’re going to rip the space apart. There is going to be an increase in the growth of government. The legislative branch increased, I believe, 27% one year, 35% the next year, for more staffing. I think it’s always worth it to try and stop the growth of government.
You mentioned concerns about a full-time legislature. How are you going to vote on SJR 102, the constitutional amendment that would allow the Legislature to call itself back into special session?
I don’t know. I haven’t decided yet. I haven’t dug into it a lot, but I do believe that that by reading the constitution, you can tell that there was always a belief that the Legislature would be part time.
I’ve served 12 years in the Legislature. I see there’s so much merit to go out into Idaho and be part of Idaho, because that is how you get the perspective. That is what has kept Idaho vibrant. We have the perspective of real people, living real lives everywhere across the state. As a constitutional officer, I travel the whole state. The regions are very different from each other, but very meritorious. I would hate to see that flavor get condensed down to just a Boise-type feeling.
Treasurer Julie Ellsworth, thank you so much for joining us.