One down, one to go.
A pair of bills proposing increases in the statewide sales tax being debated in the Wyoming House of Representatives saw divided fortunes Tuesday.
Each proposed a statewide sales tax, one to benefit schools and the other to benefit local governments.
But the bill that backers said would have provided a stable funding source for cities and counties through a new sales tax died on a vote of 10-50, while the bill that would help fund schools around Wyoming lives on.
House Bill 173, which lays out a formula for funding the state’s schools, would allow a one-half cent sales tax to be imposed statewide that would help reduce the $300 million deficit currently facing Wyoming schools – but only if the state’s reserve account falls below $650 million.
Brian Farmer, executive director for the Wyoming School Boards Association, said the tax included in the education bill seeks to offset the downturn in the mineral industry revenues that have historically funded education in the state.
“We know that for the last 12 to 15 years we’ve been incredibly heavily reliant on the mineral industry,” he pointed out. “But as the landscape changes, as the mineral economy is changing, the state is probably in need of reviewing its revenue sources. Our traditional revenue sources are not what they used to be; our expenditures maintain, and they do grow because of inflation.”
But the bill doesn’t just propose an increase in taxes.
“It involves cuts,” he said. “Looking at where might we be able to make reductions that would have the least impact to classrooms and school districts.”
But he said, make no mistake about it, cuts mean job losses.
“When 85% of (a school’s) budget is tied up in people, there really just is nowhere to keep that entirely away from impacting people,” Farmer said. “If you have cuts that are in the neighborhood of 10%, you will be seeing job losses within school districts.”
Farmer pointed out that in every community, school districts are among the top three employers – and if teachers lose their jobs, they are likely to move out of those communities rather than find a job in another field. That means fewer dollars circulating in Wyoming communities.
He added that revenue transfers are also addressed in the bill – diverting some income for the state’s savings accounts to current education needs.
Farmer explained that if imposed, the sales tax could generate around $80 million each biennium.
“So, that new revenue, combined with some cuts, combined with some revenue transfers, really goes a long way to plugging that $300 million hole,” he said.
He added he is hopeful that Wyoming’s historic high regard for education will sway legislators to support additional funding for schools.
“From the beginning of our territorial days, Gov. Campbell, the very first Governor of Wyoming, called education ‘the cornerstone of the new state,’” he said. “So from the very beginning, we’ve gone forward and built an education system that’s an envy of the nation.”
“And if we lose that, we threaten the quality of education, we threaten the very economy of Wyoming,” he added.