Make the simple but necessary change. As i said at the end of the 2017 legislative session, unemployment tax relief is job one for 2018. I hope you agree. [applause] a 2017 tax debate also led to the Idaho Supreme Court ruling last summer that we must change the way we do the peoples business to ensure public transparency and protect the integrity of our political process. So contrary to traditional practices, all legislation now must be presented to the governor before the Legislature Adjourns sine die. I welcome the new requirement and look forward to working even more productively with you on our shared priorities. Those priorities include adding to the more than 1. 2 billion in tax relief we have provided idaho citizens over the past decade. But that must be accomplished while meeting our constitutional and statutory obligations, sustainably advancing our education and other policy priorities, and ensuring that our state tax laws remain fair, stable and competitive. Its true that our tax burden in idaho is relatively light compared with other states. But our income levels also remain comparatively low, and beneath our own expectations. Yet in terms of growth, its important to note that personal income in idaho is up about 40 since 2008 while general fund revenue has increased less than 25 . So despite some selective arguments to the contrary, our economy clearly is growing faster than our state government. [applause] however, we must never forget that its the peoples money. So i will gladly join you in reducing individual and Corporate Income tax rates with an eye toward stimulating more economic growth. But that must be accomplished while keeping our fiscal house in order and our investments for the future on track. To make that possible, i will be proposing a plan to enable idahos substantial conformance with the new federal tax code without putting our state revenues or idaho taxpayers at risk. Of course, its well known that predictability is an important part of sound tax policy. But when it comes to healthcare, the federal government seems to be going the extra mile to ensure that idaho and other states have no certainty at all about what the future holds. At the same time, i have come to you repeatedly with proposals for making healthcare in idaho more accessible and coverage more affordable with or without having a federal plan in place. So in my last legislative session as your governor, i am making one final attempt. No longer should this body use my agreement not to act alone on obamacare issues as a way to stop progress that will benefit idaho citizens. We can no longer wait for congress. This issue is too pressing, and its in our hands. [applause] this session i will be advancing for your consideration the Idaho Health Care plan, a proposal about which many of you have been hearing for months now. Simply put, it would stabilize idahos Healthcare Insurance Market and give more working idaho families the ability to purchase affordable coverage. The Idaho Health Care plan gives us the opportunity to be both conservative and compassionate. It will enable those with the most costly, medically complex conditions to move their coverage to medicaid during the course of their illness. That in turn will enable Insurance Companies to reduce their premium rates for the majority of people who remain in the individual marketplace. This is not expanding medicaid. This is providing idahos working families who have modest incomes a more affordable way to get the coverage they need. And its a matter of fairness for idaho citizens who actually get less help with coverage under the socalled Affordable Care act than noncitizens legally residing here. The idaho plan will require 17. 4 million from the general fund and another 11. 4 million from the millennium fund. But the result will be lower rates for many more working idahoans, leaving them better able to pay for lifes other essential needs. As i said before, healthcare affordability and accessibility are among the central Public Policy challenges of our time. In idaho, those challenges involve a chronic shortage of physicians and other Healthcare Professionals, particularly in the more rural parts of our state. Thats why im so excited about this years opening of the Idaho College of osteopathic medicine idahos first medical school. Classes begin in august on the meridian campus of icom, which is working with Idaho State University and other stakeholders to address our lastinthenation ranking for the number of primary care physicians per capita. Icom also is committed to helping bring more residency opportunities to idaho for physicians in training. In addition, my budget recommends funding for 11 new residencies at Eastern IdahoRegional Medical center in idaho falls and Bingham Memorial Hospital in blackfoot. That will complement our own efforts since 2013 to fund more medical school seats for idaho students. We now have 40 seats dedicated to idaho medical students through the regional wwami consortium, twice as many as when i assumed this office. [applause] having Healthcare Professionals nearby is one of the factors that can determine a communitys success in developing its local economy by attracting and growing businesses that provide goodpaying jobs. The services that our communities need increasingly include costeffective ways of coping with acute Substance Abuse and Mental Health issues. And thats why i say thank you. Thank you for supporting creation of Behavioral HealthCrisis Centers through Community Partnerships in coeur dalene, idaho falls, twin falls and most recently boise. My executive budget request calls for continuing to build on the successful effort to cut back on the more costly use of Emergency Rooms and jail cells when our people face those lifeshattering challenges. Im asking for 2. 6 million in fiscal 2019 to stand up three more Crisis Centers in the lewiston, nampacaldwell and pocatello areas. This initiative is an example of idahoans taking care of our own, not waiting for washington, d. C. To prescribe or mandate a solution to our challenges. Thats a strategy borne of necessity and hard experience. But in 2017 we saw a renaissance of responsiveness and regulatory relief from our National Government. It has been especially refreshing to see the trump administrations willingness to seek our input, to really listen and embrace the value of state perspectives on issues that affect us most directly. As we all know, the whole concept of federalism spent years on the shelf. But now, what we here in idaho say and how we collaborate and develop our own solutions matters again, maybe more than ever. Its a new day on issues from protecting sagegrouse to siting major electrical transmission lines and enjoying traditional uses of our public lands. Of course there are still challenges. Obstructionists in congress and the undue influence of a carryover proscribeandpunish mentality in some federal agencies are still slowing progress. But were having fewer mother may i moments with our federal partners, and one of the results is better, more active management of our resources, and communities that are becoming better protected from catastrophic wildfires. Two programs in particular stand out. First, let me update you on our rangeland Fire Protection associations. Over the past few years, the bureau of Land Management and u. S. Fish and Wildlife Service have worked with our state department of lands to train and equip 330 Southern Idaho farmers, ranchers and their employees as members of nine rfpas. They now are providing initial attack capability and expert local protection on more than 9 million acres of idaho rangeland, protection from wildfires that threaten sagegrouse habitat and the forage that our ranching and Farming Families need to stay in business. Another example of our improving relationship with the feds is the degree to which federal Good Neighbor authority has taken root in our timber communities. Its an innovative way to more quickly implement ontheground land and watershed improvements on Forest Service acreage. Investments from the forest industry, the state and the feds so far have resulted in ten Good Neighbor authority projects in idaho. In the next few years, about 10,000 acres will be treated to improve Forest Health by carefully harvesting 65 million board feet of timber, providing 13 million in program income. The department of lands has sold and overseen the harvest of 6 million board feet of timber from fire salvage and forest thinning projects in the past year alone generating more than 1. 8 million in revenue. The efficiency and effectiveness of this work is so apparent that federal agencies are eager to line up more Good Neighbor authority projects with help from the state. [applause] thats why im asking for Spending Authority for eight new positions at the department of lands as we expand this program thats working for idaho. Perhaps the most memorable part of last year was one that most of us would just as soon forget. You can call it snowpocalypse or just a great water year. Depending upon where youre from and how you look at it. Either way, the winter of 2017 was one for the record books. It disrupted lives, endangered travelers and did many millions of dollars in damage to property and infrastructure throughout idaho. Thank you for providing 52 million in Emergency Assistance to help our communities address the most serious and immediate problems. We had some snags with disaster assessment teams being called away for one of the worst hurricane seasons on record. But we are getting relief out as quickly as possible, and were working with cities, counties and highway districts to minimize the impact of delays in federal disaster funding. As i said, it was a big year for water, whether it was falling from the sky or being recharged into idahos largest underground reservoir. Runoff from last years snowpack on top of saturated soils required careful, coordinated management of dams and reservoirs. The effort successfully reduced flooding and ensured that dam structures were secure. Meanwhile it provided a full allocation of water in the boise river and snake river reservoirs and plenty of carryover for use in 2018. Just as importantly, for the First Time Since the 1950s we put more water back into the eastern snake plain aquifer than we pumped out in 2017. [applause] water levels in the lake eriesized aquifer had been dropping at an average rate of 215,000 acrefeet per year for 60 years. But last year the idaho water Resource Board worked with private Canal Companies to recharge 317,000 acrefeet of water. A landmark Settlement Agreement between surface water users and ground water users resulted in a net gain of another 200,000 acrefeet. Along with the wet weather, the result was a 660,000acrefeet increase in water storage in the aquifer. Without our Work Together on these issues it would have been impossible to realize these historic advances in managing and protecting our most precious and fragile natural resource. About the only things we value more than water in idaho are our families and our privacy. Everything were doing in education, workforce training, health and Public Safety is about strengthening and protecting idahos children and families. Now lets talk for a moment about securing our personal data. From a technology standpoint, the world has been remade several times over since i became governor. We have learned through hard experience that information is a vulnerable asset. And we are far better prepared now to ensure the responsible management, control and protection of private information. Former air force cybersecurity expert jeff weak is now on board as idahos first director of information security. Under his leadership, state agencies have adopted rigorous National Cybersecurity standards. Critical Internet Security controls have been put in place, and a comprehensive Cybersecurity Training Program now is mandatory for every state employee. In short, were doing all we can within our existing Management Structure to defend our state resources, and more importantly to keep our citizens personal Information Safe from hackers, criminals or worse. The next step is improving the structure of that oversight. I am recommending a thorough assessment and centralization of scattered and disjointed information resources in the coming months. The goal is standardizing and optimizing Cyber Capabilities throughout state government. The proposed changes are aimed at making idaho a model for hardening our defenses while enhancing our ability connect with citizens through social media and other online tools. Idaho is well situated to be a Global Leader in this field. Just consider our investment and partnership in the Idaho National laboratorys cybercore integration center. Or the inls cybersecurity training outreach to idaho businesses. Consider the thriving cybersecurity degree programs at our universities and the Idaho National guards Cyber Operations squadron. So we are reaching a Critical Mass of infrastructure. All thats needed is our continuing commitment for idaho to remain on the vanguard of this evolving discipline. On a related note, no report on our progress over the past decade would be complete without highlighting the growing partnership between the state of idaho and the Idaho National lab. We are light years beyond the kind of legal and political disputes that dogged our relationship for many years. Today the inl is much more than a remote Nuclear Engineering outpost on the Eastern Idaho desert. Our connections now include my leadership in Nuclear Energy or line commission, our Strategic Energy alliance, and the center for advanced Energy Studies with its cuttingedge smart grid research. And lets not forget the inls growing collaboration with our universities, as well as the department of energys Stem Education efforts at idaho schools. And there are more great things to come from the inl and the Battelle Energy alliance, which just won a new fiveyear Management Contract that will ensure welcome stability in lab operations. Coming soon is the next stage in developing Small Modular Reactor technology that could be the future of Nuclear Energy. Now, from thinking globally to acting locally, allow me to update you on the success of a program with the goal of helping idahos atrisk youth develop such skills as critical thinking, teamwork and accountability. The Idaho Youth Challenge Academy so far has provided structure and a Second Chance for 648 graduates from 41 counties. Many of those cadets were struggling in school before they got to pierce. A number were having trouble at home, or with the law. Well, through last year those citizens in training had earned over 9,000 high school credits, and more than 130 of them had earned their ged or High School Diploma. [applause] whats more, Youth Challenge cadets have contributed more than 34,000 Community Service hours. They have improved forest trails, visited seniors at the local assisted living center, and volunteered at the state Veterans Home in lewiston. I can tell you, the feeling of energy, renewed hope and Endless Possibilities that you get just being around the cadets is refreshing, invigorating, and contagious. This program isnt the biggest around. It doesnt have all the bells and whistles. Its purposely located away from many of the distractions of modern life. But let me give you two quick examples of the results that the Youth Challenge academy is producing. Dylan hoopes of lewiston was in trouble in school and at home. Hed even had some brushes with the law. As his mother angela put it, he had a 1. 6 gpa and a chip on his shoulder. All that changed at the academy. Dylan embraced the training, buckled down, adopted a goaloriented attitude, pursued leadership opportunities and earned his High School Diploma with a 3. 7 gpa. [applause] his mom summed it up this way, i am confident that because of his experience at the idyca he has found the confidence he needed to overcome lifes obstacles and obtain the blessings that good citizenship has to offer him. Now dylan is 20 and a fulltime student at lewisclark state college. Hes working parttime and will receive his Associates Degree in automotive mechanics this spring. Dylan, congratulations, and thanks for being here today. [applause] daniel smith of nampa summed up his situation before entering the program this way i was overweight, underconfident and wasnt doing too well in school. The good news was that he recognized the need to start making better life choices, and the Idaho Youth Challenge Academy was there to help. Friends who had been through the academy told daniel about the positive changes it had brought to their lives changes emphasizing respect, excellence, persistence, integrity and leadership. Now daniel joins them in considering it one of the best decisions hes ever made. He got his High School Diploma, joined the military and was selected for the elite United States air force honor guard. Daniel was part of the inauguration ceremony for President Trump and most recently was in the macys thanksgiving day parade in new york city. He credits the Youth Challenge program and the mentorship it provided for helping him get where he is today, which im pleased to say is here with us. [applause] they are just two examples of how the Youth Challenge academy is improving lives, restoring lives and creating a just Real Progress for the next generation of productive, contributing citizens. Some of you have visited pierce to see the program for yourselves. I encourage anyone who questions its value to spend some time with these young people. Im confident you will be as impressed as i was. My friends, i say again, idaho is stronger and more economically diverse than ever. Our Unemployment Rate is near a record low. Wages are on the rise. Whole Industry Sectors are emerging and growing, stretching our taxpayer resources to keep up with workforce demands. But we are sustainably and responsibly investing in kthroughcareer education and training without raising taxes. We will never mortgage our future by throwing money at business attraction like some other states. But with your support, we now have targeted, performancebased incentives that work. They add to an Economic Development portfolio that includes inexpensive renewable power, a great work ethic and among the most stable, businessfriendly tax and regulatory climates in the country. I call that Real Progress, and may it long endure. Esto perpetua. [applause] you know, its really too bad that the word progress has been so thoroughly highjacked in todays political lexicon. The republicanled Progressive Movement of the early 20th century called for a more populist but Still Limited relationship between government and business. But since the Great Depression progress has become synonymous with bigger and more intrusive government, the nanny state. Its true that despite our best efforts and firmest resolve, government gets bigger. Thats a function of a growing population, rising public expectations, more complex social realities, and a changing dynamic between our public and private sectors. But we all know that making government bigger often makes fulfilling its most necessary and proper functions less focused and less effective. More importantly, making government bigger without also making it better can be a barrier to Real Progress for our citizens, for individual idahoans. Now we all know that progress isnt linear. It doesnt go from point a to point b uninterrupted. It zigzags and swerves and dips. At times in Human History its trailed off altogether. But progress always comes back. It shakes off ignorance and political extremes. It overcomes natural calamities and human failings to return, time and again throughout the ages. Progress makes a comeback when people start believing again, believing in their own abilities, believing that they can make a difference, and believing that government alone is not, never has been and never will be the answer. Progress makes a comeback when people start taking personal responsibility for moving it forward as best they can. Thats where we are in idaho preparing our state government, and everyone and everything it touches, for the future. Once again during this legislative session, we will make choices that will echo down through the generations and play a role in shaping the destinies of our families and our descendants. Because of the work we have done over more than a decade, we have never been readier for the challenges and opportunities ahead. The commonsense conservative policies advanced by this body, and by us together, have been essential to idahos progress toward better enabling our citizens to become the architects of their own destiny rather than surrendering to the siren song of entitlement. Yet just as progress isnt linear, it also isnt singular. Eventually there will be another great recession, or worse. Disasters will beset us. At some point we may once again struggle to keep our heads above water. Thats why, to be truly meaningful and impactful, progress cant be a onetime thing. It must overcome setbacks and resistance. It must be more than good intentions and a highprofile start followed by inattention and eventually abandonment. There has to be a baton to pass. There must be a fire to stoke. There has to be a clear understanding that what we do today will help our children and their children keep advancing the frontiers of freedom, slowly but surely. Because that enlightened freedom is where progress will be found for the people who rely on us to act in their best interest without upending their lives. Ladies and gentlemen, progress takes commitment. It takes political and sometimes personal courage. It requires us to see the big picture and take the long view in crafting Public Policy. And we have only ourselves to blame when we reap the whirlwind of apathy or inattention. Responsible citizenship, let alone leadership, requires us to regularly refresh the tree of liberty with the values of vigilance, prudence and common sense. You see, wellinformed and conscientious reluctance to change is not the truest enemy of progress. The truest enemy of progress is misguided, reflexive opposition to change. Our founders knew that more than 200 years ago. In 1816, Thomas Jefferson was 40 years beyond his days as a young revolutionary writing the declaration of independence. With his years as president behind him, jefferson was asked how best to adapt our fledgling National Government to rapid social and economic changes. He wrote i am certainly not an advocate for frequent and untried changes in laws and constitutions. But i know also that laws and institutions must go hand in hand with the progress of the human mind. As that becomes more developed, more enlightened, as new discoveries are made, new truths disclosed, and manners and opinions change with the change of circumstances, institutions must advance also, and keep pace with the times. That is not to dismiss or defame the timeless virtues that should populate our character or the undying truths that must light our path forward. Rather it is to remind us that our responsibility is not only to those who voted for us or only to our constituents, but also to keep pace with the times and the path of human progress. We have constitutional, legal