BOISE, Idaho (AP) — Gov. C.L. "Butch" Otter wants to eliminate Idaho's $141 million personal property tax, and then reimburse local governments for money they'd lose with a combination of state funding and cash they'd raise through new taxes.

Otter outlined his intentions during Monday's 2013 State of the State address, where he also unveiled a $2.8 billion budget, roughly 3 percent more than the current year.

The Republican governor set aside $20 million to pay cities, counties and school districts for the money they'd lose from repealing the personal property tax. To make up other lost revenue, Otter suggests giving local governments more flexibility to ask voters to raise their own taxes.

Otter's budget recommends a new mental health facility and socking away rainy day funding. It does not seek pay raises for state employees.