Wyoming Secretary of State Chuck Gray may not get a requested budget bump for a second consecutive year.
On Monday, the Joint Appropriations Committee of the Wyoming Legislature rejected Gray’s $322,600 supplemental budget request on a 6-6 vote.
Gray had requested the money for three new employees in the supplemental budget, which is an adjustment to the biennial budget.
These employees would be hired to increase his office’s Business Division’s processing capacity and to address an ongoing growth in business activity. Each position would help fulfill customer service, timely processing of annual reports and amendments, and processing of complex filings for the office, he said.
Five of the six members of the House Appropriations Committee voted to support Gray’s request, while all six Senate members voted to reject it.
The committee rejected a similar proposal for a new computer system costing $3.3 million.
Background
Last year, Gray made a $3.1 million request for a new enterprise system to allow his department to handle an increase in business without adding employees. This would’ve been added to the $9.5 million budget for Gray’s office for the current biennium.
The Joint Appropriations Committee rejected his request, saying he needed to go through the state’s official procurement process to buy the software, which includes initiating a request for proposal (RFP) process. Gray had indicated he already selected a vendor and personally negotiated the price for the software.
“Which is not the process that we go through when we procure especially multimillion-dollar computer systems,” said Sen. Mike Gierau, D-Jackson.
Gierau said sole-source contracts usually raise a number of red flags in the Legislature as being unethical.
Gray said at the time he thought the committee’s rejection was politically motivated.
During his time in the Legislature from 2017-2022, Gray was a well-known fiscal hawk, voting against almost every biennial and supplemental budget that came before him, and often commenting that the state doesn’t have a revenue problem, but rather a spending problem. He continued this sentiment while on the campaign trail during his 2022 secretary of state campaign, vowing not to expand his office.
Gray as a legislator “never would’ve allowed a sole-source contract,” Gierau told Cowboy State Daily. “He would scream and wave fraud and abuse before we could swing a dead cat.”
That Request
Gray’s office returned to the Appropriations Committee late last year and made a new, revised request for the three employees that would cost substantially less money than his original request. It was stated three separate times this request was being made because of the past rejection.
While testifying before the committee in December, Gray’s staff explained that the request would pay for itself in four days when considering the amount of business filings being made with his office.
“The Senate trying to add over $3 million to our budget when we can handle the issue with $300,000 is not fiscally conservative in my opinion,” Gray said. “Our request this year was 10% of the size of what the upgrade would cost.”
Over the past year, Gray’s office has developed a 24/7 online platform for a range of services. Businesses can now submit annual reports, reinstatements, and select business formations through this platform. State agencies can also file administrative rules allowing the public to comment and view changes. They’ve also introduced an algorithm to improve the efficiency of online name checks.
Gray told Cowboy State Daily following the rejection that his department came up with its own solution to immediate needs to expand audits to address business fraud and handle the increase in business filings.
“It is so important that we continue to expand audits and attack fraud, while also providing strong service to the people of Wyoming,” Gray said.
The Secretary of State’s Business Division has seen consistent, exponential growth in recent years, and it expects it to continue at an average year-over-year increase in business filings of 20%, he said. In fiscal year 2024, the Business Division processed more than 675,000 filings, up from 590,000 in 2023, and 462,000 in 2022.
The Business Division is responsible for generating more than $60 million of revenue into the General Fund per biennium, with annual revenue growth exceeding $5 million.
Gray would also like his office to further expand services to include expedited filings, which is being addressed in a bill brought this session.
Secretary of State Chuck Gray at the Wyoming Capitol. (Matt Idler for Cowboy State Daily) 
Sen. Darin Smith and the Joint Appropriations Committee meet Monday, Jan. 20, 2025, at the Wyoming Capitol in Cheyenne. (Matt Idler for Cowboy State Daily)
Compromise Rejected
Gierau brought a compromise Monday that would’ve given Gray $3.3 million to purchase the software he requested last year as long as he followed the state’s procurement policy.
“I say we still give him exactly what he asked for in his … budget that was just 11 months ago,” Gierau said.
Sen. Darrin Smith, R-Cheyenne, agreed, saying it would help Wyoming remain competitive with the states of Delaware and Nevada for getting limited liability companies to register in-state. He considers the office in some ways not using 21st century technology and the changes requested “absolutely imperative.”
“This software will really help the Secretary of State’s Office and it’ll also reduce the number of hands that need to touch the paper,” Smith said.
Gray said the committee’s about-face on the issue is confusing.
“It is too bad that the Senate Appropriations Committee has changed its mind,” he said. “The circularity of positions on this is not helpful for attacking fraud and also serving small businesses in Wyoming.”
Rep. Ken Pendergraft, R-Sheridan, said in conversations with Gray, the secretary communicated that the price he negotiated for the software was a deal no longer on the table and it would take too long to receive, with an estimated completion time of 18 months.
“This motion as laid out is not necessarily feasible in my view,” Pendergraft said.
After hearing various arguments on the issue, each side of the Appropriations Committee met in private for five minutes to discuss their respective stances.
The committee voted down the compromise on a 6-6 vote, with Rep. Trey Sherwood, D-Laramie, the only member of the House to support it.
When the committee voted to support Gray’s original budget proposal, it also died on a 6-6 vote.
Rep. John Bear, R-Gillette, and Gierau both said they expect the issue to come back up again during the session and consider the issue of providing funding to Gray’s office is far from being a done deal.
“We’re going to have a robust discussion about it,” Gierau said. “We’ve got to talk to the secretary and get the straight scoop.”
Leo Wolfson can be reached at leo@cowboystatedaily.com.
