The Associated Press August 15, 2011, 1:45PM ET

Idaho forecasts $179M budget surplus in 2012

Idaho is expecting its second year of big budget surpluses when the 2012 fiscal year ends, presenting conservative Idaho with tough choices that could include restoring programs or cutting taxes.

Come July, Gov. C.L. "Butch" Otter's office and the Legislature expect to have $179 million in the bank, based on the spending plan passed by the 2011 Legislature.

That's after an $85 million surplus in the fiscal year that ended June 30.

All this depends on Idaho's economy continuing to produce healthy tax revenue, something Otter's budget chief Wayne Hammon says is uncertain given the national debt downgrade and European turbulence.

But if the forecast holds, it'll leave conservative Idaho lawmakers grappling with the question of managing surplus cash when their natural inclination is to cut spending or reduce taxes.

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