The new bill, which is scheduled for a full hearing next week, would cost $2 million next year from Idaho's general fund.
Proponents say investing in programs that curb recidivism could stunt the growth of Idaho's inmate population, which has jumped 10 percent since 2008.
They say the bill will help the state save millions.
The justice reinvestment program is aimed at addressing the underlying causes of Idaho's high lockup rate, especially for non-violent drug offenders.
Idaho has a very low crime rate, but a high percentage of its population behind bars.
Gov. C.L. "Butch" Otter has publicly backed the plan, which zipped through a Senate Judiciary Committee Friday afternoon.