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Park County Property Taxes Explode; Assessor Calls For Tax Cap

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By Leo Wolfson, Cowboy State Daily

In his 37 years with the Park County Assessor’s Office, county assessor Pat Meyer said he’s never seen anything like it. 

This spring, his county experienced the largest increase in property taxes he has ever seen, with spikes of 25% to 45% from the previous year. 

A recent visit from an 87-year-old living on a fixed income of $2,029 per month brought home the stark reality of the situation.

“It will take him a month and a half just to pay his (property) taxes off his Social Security,” Meyer said.

Meyer said there have been similar increases occurring throughout the state. In Teton County, around 60% of residents saw property taxes spike by upwards of 30% to 50%. The remaining 40% saw even larger increases of 50% or higher. Similar increases have been reported in Sheridan, Fremont and Lincoln counties. 

The dramatic increases have changed Meyer’s mind about efforts to cap property tax growth in Wyoming in the range of 5% to 10% per year.

“I’m not going to sit back and do nothing with this problem,” he said. “When’s the end? I don’t know. But we do not want to turn into a Jackson Hole and we do not want to tax people out of their houses.”

Meyer actually lobbied against a limit on property tax increases in early 2021, mentioning to the Legislature’s Revenue Committee at that time, “when people go to sell their house, they like our values up,” explaining that assessors follow the market in their tax assessments. 

But that was before Park County and many other Wyoming counties saw large property tax increases in 2021 and an even more dramatic surge this spring.

“I’m allowed to change my mind,” Meyer said. “I was against it before I saw what was going on with Park County.”

Meyer said after that meeting, he started researching questions that had been left unanswered by legislators before. He began comparing local growth on a national level and researching the laws of other states, finding valuable information on property tax limits that exist elsewhere in places like Arizona and Oklahoma. 

In Arizona, the state, working from fair market value, caps property value growth at 5% and also mandates that a homeowner’s property value has to increase by more than 15% before the taxes on it can be raised by more than 5%.

Cody resident Tim Lasseter has criticized Meyer for changing his stance on this issue.

“He has been in office a long time and a great deal of weight is placed on his opinion,” Lasseter said. “He could have had a positive impact on that (Revenue) committee for the benefit of the taxpayers of Park County and across the state. He chose instead to help kill the very type of legislation he now claims to support.”

The proposed 2021 bill was HB 99, sponsored by Rep. Chuck Gray, R-Casper. The bill would have capped property tax growth at 3% each year, which Meyer said is an ideal market increase. 

The bill died on introduction in the House. A similar bill that would have capped property tax increases at 5% was also introduced in the Senate this year but died in the Revenue Committee by a 5-4 vote.

“We must stop these out-of-control property tax increases,” Gray said in a Friday press release. “The bill I brought in the 2021 Session, HB99, is the gold standard and what should be done in Wyoming.”

Meyer said he’s also looking at homeowner tax exemption programs in other states like Florida. In Wyoming, veterans get a small discount on their property taxes, but there are no such deals for seniors on a fixed income.

The state does offer a property tax refund program for all those making less than $48,075 per year.

Park County Commissioner Lee Livingston said he supported a 2022 bill sponsored by Senate President Dan Dockstader, R-Afton, that would have offered assistance for the elderly and the infirm, but it died in the House.

Livingston spoke on behalf of the Wyoming County Commissioners Association against the 5% cap but told Cowboy State Daily on Friday he supports some type of fix to the property tax spikes.

“Especially for those folks that have owned their homes for a long time and have no desire to sell,” he said. “It is definitely a tricky situation though.”

Meyer said he plans to do more in-depth research and speak with assessors from other states. He will then present his findings and proposals to the Wyoming County Assessor’s Association meeting in Lander in July and to the Legislature’s Revenue Committee in September. 

In December 2021, Meyer proposed a 20% property tax increase cap to Sen. Cale Case, R-Lander.

In a phone interview Friday, Case said he is fully aware of the property tax increases, as there have been many reported by his constituents in Dubois, but said any blanket property tax cap would violate the Wyoming Constitution. He did, however, support Dockstader’s bill. 

Case said residents need to be concerned about the state’s sources of revenue moving forward, with mineral royalties on the decline over the past five years.

“We have to look at it holistically,” he said. “We might not be able to afford to lose those property taxes.”

Meyer and Case said the one flaw with a flat property tax cap is that it can lead to disparities based on property value. Property values will rise at different rates, which means the tax increases for some will be greater than the tax increases for others — a violation of the state Constitution, according to Case. 

But the consistency of growth throughout the area gives Meyer confidence there will be balance as a whole.

Cause And Effect

Meyer said 2020 election data showed around at least 2,000 new residents moving into Park County, a roughly 7% increase since 2010.

Meyer said the influx of wealthy new residents and inflation has led to the rapid tax increases.

“They spent a lot of money, they drove it up,” he said. “But now I can’t blame it on out-of-staters, that’s what you’re going to have to pay.”

Property value increases do help increase a homeowner’s equity in a home when it comes time to sell. But after many years of increasing market value, those property taxes can make a serious dent in whatever profit is made when the home is sold.

“You’ll get a lot more money for your house right now, except you’ve got to move somewhere else or you’re going to be in the same problem buying another one,” Meyer said.

Meyer said he is not sure at this time if he will advocate for extending these caps to commercial property, as they produce income and landlords can compensate for higher property taxes with higher rents.

Wyoming law requires assessors to make a full market analysis before making their tax determinations, and the Department of Revenue and State Board of Equalization performs audits on these assessments to ensure compliance. 

“The values we arrive at are most often a conservative estimate of what your property would sell for,” Meyer wrote in a letter he included the 2022 property tax information sent to every Park County property owner. “We do not set the market, we follow it.”

Meyer said he wrote this personal letter to prepare residents for the shocking increase they were likely about to see.

Doug and Debra Rosendahl live in rural Park County and only had a roughly 9% increase on their property taxes. Still, they have great concerns about what the future may hold.

“It’s not terrible but if it happens year after year it will be,” Doug Rosenthal said.

Meyer will research the issues as he is runs for reelection this fall. 

“I was afraid if I didn’t run, no one would start going (to handle the problem),” he said.

There are no candidates running against him at this time. Meyer’s office hasn’t received any formal appeals on property taxes so far, but has received hundreds of calls about the increases.

“Why did his mind suddenly change (on property tax caps)?” Lasseter said. “Perhaps because it’s an election year and people are very upset with the tax hike.”

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Wyoming Ranked Top For Business Tax Climate For 10th Straight Year

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By Jim Angell, Cowboy State Daily

Wyoming has again been identified as the state with the country’s best tax climate for  businesses by a tax policy group.

The Tax Foundation identified the state’s lack of personal and corporate income taxes and its relatively low sales taxes as a reason why the state stayed in the No. 1 ranking it has held for the past nine years.

And while the ranking is good news for the state’s businesses, other factors also figure into the success of those businesses, according to the president of the Wyoming Business Alliance.

“The business community is very resilient and to have a favorable tax climate definitely helps,” Cindy DeLancey told Cowboy State Daily. “But it’s not the only answer. There are many key ingredients that have to come together for businesses to be successful in Wyoming.

The Tax Foundation, in its annual report, gave Wyoming its highest ranking for a tenth consecutive year because of its lack of corporate and personal income taxes.

“The absence of a major tax is a common factor among many of the top 10 states,” the report said. “Property taxes and unemployment insurance taxes are levied in every state, but there are several states that do without one or more of the major taxes…”

South Dakota placed second for the best tax climate.

DeLancey welcomed the ranking for Wyoming and credited state leaders for the policies that led to the rating.

“We’re incredibly blessed to have such thoughtful and considerate policy makers who really work to try to keep Wyoming competitive and our economy strong,” she said. “To see that ranking again is incredibly valuable in light of our state coming off of two years of the pandemic.”

However, state leaders must continue to pay attention to other factors that give the state a good climate for business, she said.

“It’s important that we keep our eye on the ball as far as regulatory developments and our workforce development,” she said.

Wyoming must also continue its work to diversify the economy and reduce the strain on the state’s energy industry, she said.

“We’re lucky the energy industry has paid our taxes for generations,” she said. “But with our global economy, we need to look at other industries to take the pressure off of an industry that is stressed to the max.”

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Wyoming Hospitality, Retail Tax Collections Up Over Pre-Pandemic Levels

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By Jim Angell, Cowboy State Daily

Wyoming’s hospitality and retail sectors were the high spots in the state’s economy in August and have been for the last two years, according to figures released by a state agency.

The latest report on the state’s economic indicators showed that not only did sales tax collections for those two sectors grow in August compared to August 2020, but they posted gains over pre-pandemic levels.

“Not only did these two sectors experience substantial increases relative to August 2020, they also experienced large increases when compared to August 2019, up 26% and 13.5% respectively,” said the report “Wyoming Insight,” prepared by the Economic Analysis Division of the state Department of Administration and Information.

The monthly report, which tracks figures that indicate the health of Wyoming’s economy, showed tax collections in the leisure and hospitality industry in August increased by $5.4 million over the same month in 2020, a 66% gain.

Retail trade tax collections, meanwhile, increased by almost $4.5 million over August 2020, a gain of 17.9%.Meanwhile, tax income for the education and health sector fell by $2.8 million from 2020, a decline of 54.2%.

Every county in the state except two saw an increase in total sales tax collections in August over 2020 figures, the report said, led by Teton County with an increase of almost $4.7 million from one year ago, 66.4%.

Carbon and Converse counties both saw declines in tax collections, 62% and 42.6%, respectively. The report noted that the lack of wind power construction projects in August skewed some of the annual tax collection comparisons.

The leisure and hospitality industry also accounted for the largest increase in jobs during the one-year period, with 4,900 new jobs created in August compared to 2020. Across all sectors, Wyoming added 8,300 jobs during the year for a total of 273,000.

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Wyoming Sales Taxes Jump In May From 2020

Published on in News/Taxes
State checkbook reveals $1.2 billion in out-of-state expenditures
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By Jim Angell, Cowboy State Daily

Wyoming’s sales and use tax collections in May increased by almost 14% over May of 2020, according to a state agency, due largely to a serious slump in collections one year ago caused by the coronavirus pandemic.

The state Department of Administration and Information’s Economic Analysis Division, in its monthly report “Wyoming Insight,” said sales and use tax collections in May totaled about $55.5 million, an increase from May of 2020 of $6.7 million, or 13.7%.

Much of the increase was attributed to the fact that sales and use collections lagged in 2020 because of last year’s coronavirus pandemic.

“May 2020 is when statewide collections were at (their) lowest point during the pandemic,” the report said. 

Teton County led the state for gains in sales and use tax collections, collecting $1.7 million in May, a 69.8% increase over figures from May 2020. Laramie County had the highest total tax collections in May at almost $2.4 million, a 32.5% increase.

Converse County’s sales and tax collections declined by almost $1.9 million in May compared to one year ago, 45.1%. Weston County had the highest percentage drop in collections, 46.1%, or $362,000.

“Wyoming Insight” provides monthly updates on the figures that indicate Wyoming’s economic health.

In addition to sales and tax use collection information, it provides data on mineral prices, the state’s cost of living and unemployment rates.

According to the report, the state’s mining industry continued to show the greatest losses in terms of total collections, almost $1.9 million in May compared to 2020, while the construction industry saw a decline in tax collections of 33% from 2020, $392,800.

However, the leisure and hospitality industry, hard hit by the pandemic-forced closures of 2020, saw sales and use tax collections increase by 73.4% in May from last year, $2.3 million.

The retail trade sector saw collection gains of almost $3.7 million in May over 2020, an increase of 17.6%.

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Bill Proposing New Sales Tax For Schools Moves to Wyoming Senate

Published on in News/Taxes/Education
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By Wendy Corr, Cowboy State Daily

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.

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Legislator Says Wyoming Should Sell State Jets, WYDOT Pushes Back

Published on in News/Taxes/Legislature
Wyoming’s jets cost state $1 million in 2018
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By Ellen Fike, Cowboy State Daily

Sen. Anthony Bouchard, R-Cheyenne, says Wyoming sell its two jets used for transporting state employees, but some officials have pushed back against this idea.

“The State of Wyoming should list its TWO Luxury jets on EBAY instead of raising taxes and pushing toll road,” Bouchard wrote on his Facebook account that also featured a photo of the planes.

However, multiple Wyoming Department of Transportation studies have concluded the planes actually save the state money instead of being more costly.

State aeronautics division administrator Brian Olsen told Cowboy State Daily that although his department doesn’t have an official stance on the jets, the staff finds they are an efficient and effective tool in conducting state business.

“In 2014, a third party conducted an operational study report. That report indicated that the … total cost to operate the two aircraft was $2,645,995 average per year,” Olsen said. “We estimate the current operating costs to be on average between $2 and $2.1 million per year.”

The state owns the aircraft outright, so the only costs are for operations and maintenance.

“WYDOT pays the fixed costs (training/payroll/hangar/etc.) because we own and operate the aircraft and we would be responsible for those costs regardless of usage,” Olsen said. “When an agency uses the aircraft, we charge $1,425 per hour, that rate covers variable (consumable) costs.”

The study Olsen referenced also found the state’s transport aircraft were 14% more efficient per mile than auto/airline travel (based on a $100,000 salary). However, the study didn’t account for lost productivity or travel expenses associated with travel by car, which would also make the aircraft more efficient, he said.

The report also concluded the state’s aircraft were 32% more efficient than fractional aircraft (one that has multiple owners) and 44% more efficient than chartering a similar aircraft.

Gov. Mark Gordon’s spokesman Michael Pearlman pointed Cowboy State Daily to a comment the governor made to the outlet back in 2019, as he holds a similar stance today.

“Governor Gordon supports fiscal responsibility and the judicious use of taxpayer dollars,” Pearlman said at the time. “Several WYDOT studies have determined that owning state aircraft is more cost-efficient than private charters or driving vast distances.”

Pearlman added at the time Gordon advanced a budget proposal including more than $500 million in strategic cuts.

“Selling the state’s aircraft would do little to address the state’s budget shortfall,” Pearlman said.

Rep. Chuck Gray, R-Casper, told Cowboy State Daily on Friday he introduced an amendment earlier this week requiring WYDOT to sell the jets, but it failed.

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Wyoming Ranked No. 1 For Business Tax Climate

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By Jim Angell, Cowboy State Daily

For the seventh consecutive year, Wyoming has been ranked the top state in the nation by a tax policy group for its business tax climate.

However, a member of the Legislature’s Revenue Committee said he is not sure the high ranking translates into new business for the state.

“It obviously is great to get an A-plus on a paper, but it doesn’t necessarily mean you’re the smartest person around,” said Sen. Ogden Driskill, R-Devils Tower. “It doesn’t equate to anybody coming here.”

The rankings by the Tax Foundation is based on the taxes in place in various states. The highest ranking states had fewer of what the group called “major taxes,” such as corporate income taxes, individual income taxes and sales taxes.

Wyoming fared well because it has no income tax, a well structured sales tax and modest excise taxes, which the Foundation said would make the state more attractive for economic development.

“Taxation is inevitable, but the specifics of a state’s tax structure matter greatly,” Jared Walczak, vice president of state projects for the Tax Foundation, said in a news release. “States with more competitive tax systems score well in the index, because they are best suited to generate economic growth.”

Wyoming ranked first in the nation in the area of personal and corporate income taxes because it has none.

For sales taxes, the state ranked sixth overall, while it was ranked 39th for property taxes.

Neighboring states also did well in the overall rankings, with South Dakota placing second, Montana placing fifth and Utah placing eighth.

New Jersey, with some of the country’s highest property taxes and second-highest corporate and individual income tax rates in the country, placed last.

However, Driskill noted that since Wyoming first topped the Tax Foundation’s rankings, the state’s tax structure has not helped the state lure new business as much as it should have.

“We might ace the test, but we’re not really passing,” he said. “The states with the best business climates are the ones attracting business. And that’s sure not Wyoming. We’re not even competing against our surrounding states.”

The state needs to take a hard look at itself to determine what changes are needed to bring in businesses, Driskill added.

“We might have what looks good on paper, but in fact, when you get here, you find we’re a much more regulatory state than it might look like we are,” he said. “We need to reassess what we are doing.”

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Where’s Your $1,200 Stimulus Check? Here’s How to Track It.

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Looking for your stimulus check? Most Americans who qualify will receive it by the end of the week.

The good news according to David Pope, the CEO of Wyoming-based accounting firm DAPCPA, is that if the IRS has your bank information, is it will be deposited directly into your bank.

The IRS announced a new tool to track your stimulus payment. If you filed a 2018 or 2019 tax return but didn’t include your direct deposit information, you can do that here as well.

What if you haven’t provided the IRS with your bank information? Be prepared to wait.

“If you have not provided the IRS with your bank account information on previous tax returns, your payment will be delayed by a matter of weeks or possibly months,” Pope said.

“If you did not file at all in 2018 or 2019, there will also be a delay. In the case of those who have not filed, the IRS will attempt to send checks to folks that received Social Security or some other form of government payment,” he said.

Who will receive a check?

U.S. residents will receive the Economic Impact Payment of $1,200 for individual or head of household filers, and $2,400 for married filing jointly (plus up to $500 for each qualifying child) if they are not a dependent of another taxpayer and have a work eligible Social Security number with adjusted gross income up to:

$75,000 for individuals
$112,500 for head of household filers and
$150,000 for married couples filing joint returns

Taxpayers will receive a reduced payment if their Adjusted Gross Income is between:

$75,000 and $99,000 if their filing status was single or married filing separately
112,500 and $136,500 for head of household
$150,000 and $198,000 if their filing status was married filing jointly
The amount of the reduced payment will be based upon the taxpayers specific adjusted gross income.

How to Spend it?

While spending the check is entirely up to you, Pope does not recommend buying $1,200 worth of Ho-Hos and Schlitz Malt Liquor.

“The program was meant to help people pay their bills during this terrible economic disaster,” he said. “In the Great Recession of 2008-2013, there were record numbers of foreclosures and defaults on loans. This is intended to help lower those numbers and help people to get by until the reopening of the economy.”

More Money to Come?

What if you accidentally did spend the entire check on booze and donuts? Will the government be sending another check?

Don’t count on it, Pope said. But you never know.

“Congress is already discussing a 4th stimulus package. This should provide more funds to businesses and a large infrastructure allocation. It may also include additional money to individuals. There have even been suggestions floated that include some sort of monthly payout to taxpayers, but nothing specific yet,” he said.

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Bob Geha: Taxpayer Bill of Rights Legislation Introduced

Published on in News/Taxes/politics
Bob Geha
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By Bob Geha, Cowboy State Daily

The state’s voters would have to approve tax increases and higher debt levels under a measure introduced in Wyoming’s House.

House Joint Resolution 2 proposes an amendment to the state’s Constitution that would require voters to approve tax increases by any governmental entity in the state.

The measure, referred to as the “Taxpayer’s Bill of Rights,” was proposed by state Rep. Chuck Gray, R-Casper.

“This tax increase narrative keeps coming back, it’s the wrong move for our state,” he said. “The other thing this bill does is to put a cap on state expenditures … so that we stop these boom and bust cycles in terms of expenditures. We save more during the boom so we have more in savings during the bust and that means we don’t need the tax increases.”

Gray said if the amendment had been in place years ago, Wyoming would have more than twice in savings what it does now.

To be considered during the budget session, the bill must win the support of 40 representatives. If the bill is approved, a constitutional amendment would be submitted to voters during the general election in November.

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Lodging Tax: $21.5 Million Raised Statewide in 2019

Published on in News/Taxes/Tourism
Lodging tax
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By Wendy Corr, Cowboy State Daily

Because of the importance of tourism to local economies throughout the state, many counties are making the most of an optional tax that allows them to lure visitors, bringing much-needed tourism dollars to sluggish economies.

According to the Wyoming Travel Industry Coalition, the local option lodging tax works well as a source of revenue for local tourism promotion. 

A report released by the state shows that more than $21.5 million dollars was raised by lodging taxes statewide in 2019. 

Income from the lodging tax, which is assessed in addition to sales taxes, is earmarked for local travel promotion. The tax, which ranges from 2 percent to 4 percent, must be approved by local voters every four years. 

None of the lodging tax revenues can be used for projects outside of tourism advertising and promotion — no capital construction, no general funding for cities, towns and counties. 

But for many local governments, that tax income is a jump-start for the economy.

Claudia Wade, executive director for the Park County Travel Council, said that because of the lodging tax, the council can spend more dollars advertising attractions and recreation, which influences travelers’ decisions to stay longer in the area.

Because of its location, Park County is a natural draw for tourists heading to Yellowstone National Park. 

Wade said that because of the advertising financed with lodging tax revenue, more people are drawn to the region as tourists, which then allows more locals to stay employed.

“Because the lodging tax is collected on top of the sales tax, when visitors come to the area, they bring in more revenue that can be used for general fund purposes for local governments,” Wade said.

“Those expenditures have a big impact on our economics. The businesses that they’re frequenting also are hiring employees — which means those front line workers and workers behind the scenes all benefit from the tourism industry and visitors coming to the area.”

What the lodging tax does in Park County is indicative of its impact across the rest of the state. Laramie County received more than $2 million in lodging tax revenue last year, while Casper and the local governments in Natrona County received $1.8 million.

Park County, with Yellowstone as a major tourism draw, took in more than $3 million, and Teton County received more than $7.7 million in lodging tax dollars.

Wyoming law specifies that the tax must be used for travel and tourism promotion by the county or city approving the tax, and is limited to promotional materials, television and radio advertising, printed advertising, promotion of tours and other specific tourism related objectives. 

Wade pointed out that Park County does what most other counties do with the funds.

“We pay for connect TV ads, some print, there is some digital, and a lot of social media,” she explained, “so it’s a big mix – much bigger than when it was when we initially started in 1986.” 

Brook Kaufman is CEO of Visit Casper. She said the lodging tax makes a huge difference in the local economy in Natrona County.

“I think there is a perception that Natrona County doesn’t have a robust tourism economy, but we do,” she said. “It employs just over 2,600 people, generates almost $300 million in direct spend and $15 million in sales tax. For us, tourism is really critical to employment.”

Kaufman said Visit Casper invests the lodging tax dollars in marketing programs that drive return visits, which creates jobs and sales tax collections for both cities and counties. 

A statewide lodging tax bill is being proposed again this year at the Wyoming legislature, which Wade said would assist not only the individual counties, but the entire state.

“The lodging tax is important as a whole to the state — that additional money could be very beneficial to the Wyoming Office of Tourism, which has a broader reach than our local organizations,” Wade explained.

The Wyoming Travel Industry Coalition reports that the lodging tax makes up about 18 percent of the tax dollars from travelers. While a study by the American Economics group in 2008 concluded high room taxes can influence travelers’ decisions to stay in a certain city for any length of time, Wade said that’s not much of a concern in Wyoming.

“Our lodging tax rate here in Wyoming is fairly insignificant compared to other regions,” she said, noting that states such as Michigan (at 12 percent) and Connecticut (at 15 percent) have significantly higher lodging taxes than in the Cowboy State. 

Only five states have lodging tax rates lower than Wyoming, according to a report issued by the National Council of State Legislatures.

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Legislators on dwindling state revenues: ‘It’s real, it’s bad’

Published on in Energy/News/Taxes
Silhouette of a Pump Jack
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By Ike Fredregill, Cowboy State Daily

As coal, oil and natural gas revenues decline, state legislators could have some hard decisions ahead, according to information generated by a strategic planning effort created by Gov. Mark Gordon. 

Dubbed “Power Wyoming,” the planning effort forecasts several scenarios for mineral-based state revenue streams during the next five years, all of which predict a deficit in coming years. 

The information compiled by Power Wyoming was presented to the Wyoming Legislature’s Joint Revenue Committee on Nov. 11. 

“The best projections in this model are very unlikely, and the worst are the most likely,” said Sen. Cale Case, R-Lander, the Senate committee’s chair. “That’s very scary.”

Case worked on Power Wyoming with Rep. Dan Zwonitzer, R-Cheyenne, chairman of the House Revenue Committee. Also on the team were members of the executive branch and economists familiar with the state’s energy sector such as Rob Godby, the University of Wyoming director for Energy Economics and Public Policies Center and a College of Business associate professor. 

Zwonitzer said the planning effort is the starting point to prepare for diminishing mineral revenues. 

“Power Wyoming is just the first step of saying, ‘Here’s what’s going to happen to Wyoming,’” he said. “The group was formed to get the message out there: ’It’s real, and it’s bad.’”

Renny MacKay, Gordon’s policy adviser, said Power Wyoming was not established to be a group of individuals working on potential solutions to the state’s revenue problems, but rather a group of experts working to gather to analyze data.

“This is a cone of different scenarios for both revenue and energy production,” MacKay said.

In its current iteration, Power Wyoming provides insight by compiling information from the state’s Consensus Revenue Estimating Group and the U.S. Energy Information Administration, among others.   

“Energy production is declining … and if there is production decline, the traditional jobs we have in Wyoming would be impacted,” MacKay said. “Information gives us power. The more we look at it, the more we talk about it, we can figure out what our opportunities are as a state.”

Worst case scenarios

While the coal industry’s struggles are being felt across the state, Case said Power Wyoming illuminated potential problems with the natural gas sector as well.

“I did not realize the issues with natural gas were as serious as they are,” he said. “Everybody else is thinking natural gas is doing great, and it’s not.”

The planning effort’s initial simulation results highlight some scenarios where the state’s total mineral revenue drops by 10 percent as early as 2020-2022 before a potential partial recovery by 2024. Some scenarios show a full recovery to expansion in revenues, but Power Wyoming reports they are the least likely cases within the current market conditions and expectations.

Most scenarios predicted a decrease in both Wyoming’s total employment and population, but in the worst case scenarios, the state’s total employment could decrease by about 20,000 jobs by 2024, followed by a similar decrease in population.

“In the next five years, there’s no way to absorb those (lost) jobs,” Zwonitzer said. “That means we’ll either have to have an increase in taxes, or a decrease in government services.”

In the worst case scenarios, he said the state would most likely need to pursue both. 

“We’ve lived a certain way in this state for 100 years with minerals paying the taxes,” Zwonitzer said. “That major revenue source is going away. So what does that look like for our future, and what do we want to do about it?”

Unreliable oil

Some of the scenarios, including those in the best case category, relied heavily on increased oil production balancing decreased coal and natural gas production. But Case warned against putting faith in the oil market.

“I think oil is very susceptible to environmental and carbon risk,” he said. “Changes in policy from Washington, D.C., and from other states could make it impossible to grow petroleum.”

A low-carbon policy consideration was also provided for the Revenue Committee as part of the Power Wyoming data package. Case said the presentation offered a more realistic outlook of oil than the initial simulation results put together by Godby.

In the policy consideration, Shell Global estimates a high usage of liquid hydrocarbon fuels, such as gasoline, in 2020 by about 25 million barrels a day. After the peak, however, the oil company predicts a gradual decrease down to 10 million barrels a day in 2060 and about 2 million barrels in 2100 as part of its strategy to comply with the Paris Climate Accord.

Most scenarios presented by Power Wyoming indicate the mineral sector is going to take a significant hit in the next five years, but even if the best case scenarios come true, Case said the future of energy is moving away from Wyoming’s traditional mineral offerings.

“This will tell you that the bad times are here,” Case said. “This is not just a tool for the Revenue Committee, but it’s also a tool for us. If you’re an employee in the coal industry, it’s probably time for you to get your own house in order.”

MacKay said Gordon is already working on the next steps of the planning effort. 

“We are bringing folks from the private industry now,” he explained. “Power Wyoming will definitely stick around for the foreseeable future.”

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Legislative committee approves Medicaid expansion plan

Published on in News/Health care/Taxes
2359

CHEYENNE — A plan to expand Medicaid coverage to about 19,000 Wyoming residents won approval from a legislative committee on Tuesday.

The Legislature’s Revenue Committee voted 8-5 to send to the full Legislature a bill that would expand Medicaid coverage at a cost of about $154 million for two years. Federal funds would cover about $136 million of the cost, with the state picking up the remaining $18 million.

Supporters argued that given declines in the state’s mineral industry, residents will need the extra assistance provided by expanded Medicaid coverage.

“I think the coal bankruptcies up in the northeast have made people sit back and think a little bit differently about our economy,” said committee member Rep. Cathy Connolly, D-Laramie. “We know that people are going to lose their jobs. We know it. Every bit of information points to it.”

Marcie Kindred, a Cheyenne Democrat who plans to run for the state House of Representatives, said the state owes it to its residents to provide assistance.

“I’m really lucky that I have a network of support of people to help me get out of that cycle of poverty,” said Kincaid, a mother of four who has relied on Medicaid coverage. “But what about the people that don’t have that network of support, that don’t have that health (coverage)? We, as citizens of Wyoming, have to care for our own. We have to be that support and turn back and pull them out.”

Opponents of the measure argued that the state will have to pick up a larger share of the expense should the federal government reduce its level of support.

“The federal government does not have the money for this,” said Karl Allred, a former state representative from Evanston. “Eventually, that’s going to go away. And once you’re into it, you can’t get out really effectively. Are you going to tell people all of a sudden now that you’ve been giving them health care and now you’re going to take it away?”

Bob Wharff, a lobbyist from Evanston, agreed.

“If we become dependent and reliant upon the government to fulfill that and it falls apart, there’s no other safety net there,” he said.

The measure will be forwarded to the full Legislature for its consideration during its upcoming budget session in 2020.

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Proposed increase in alcohol tax rejected by committee

Published on in News/Taxes/Food and Beverage
alcohol tax
2339

By Ellen Fike, Cowboy State Daily

A bill that would have doubled the alcohol taxes in Wyoming was rejected on Wednesday by a legislative committee.

The bill lost by one vote, with seven members of the Joint Labor, Health and Social Services Committee voting against it and six members voting to move it forward to the full Legislature.

The bill considered by the committee during its meeting in Cheyenne would have doubled the excise tax on alcohol — from three quarters of one cent to 1.5 cents per 100 milliliters of wine, from 2.5 cents to five cents per 100 milliliters of spirits and from one-half cent to one cent per liter of beer — for three years. 

The money raised from the increase, estimated at $1.9 million a year would have been split, with half going to the Department of Health to fund behavioral programs that provide mental health and substance use treatment. The other half would have been used by the Department of Corrections for the purpose of providing mental health and substance use treatment for parolees and people who have been released from an institution. 

It would have been the first increase in alcohol taxes since the end of Prohibition in 1933.

Even with the increase, Wyoming’s alcohol taxes still would have been the lowest in the nation, Rep. Mike Yin,  D-Jackson, pointed out during the meeting. 

The discussion drew passionate pleas from both elected officials and members of the public, with Sen. Charles Scott, R-Casper, being one of the major proponents of moving the bill forward. 

“We’ve identified a real need for substance abuse treatment for the public and our inmates,” he said. “By identifying that need, we should fund it.”

According to a University of Wyoming study, alcohol abuse cost the state more than $840 million in 2010 due to lost productivity, health care costs and criminal activity.

However, some legislators simply did not support any tax increase.

Rep. Clarence Styvar, R-Cheyenne, admitted before the vote even took place that he would say “nay” to the proposed bill. 

“We don’t need to be taxing one group of people,” he said. “I said it last year when they tried to raise the tobacco prices. I’ve said it before and I’ll say it again: ‘No new taxes.’”

Others expressed concern that the tax income, once raised, might be used for purposes other than what were intended.

Mike Moser, executive director for the Wyoming State Liquor Association, argued other resources are available for those suffering from substance abuse and mental health problems.

“We’re asking responsible consumers of alcohol, the vast majority, to be forced to pay for substance abuse when so many of these cases don’t have anything to do with alcohol and mental health programs,” he said. “This isn’t apples and oranges. I believe we’re targeting a select, responsible few to cover the entire gamut.”

Moser also argued that the tax increase could hurt alcohol sales to “price-sensitive” Wyoming consumers and said those along Wyoming’s southern border might drive to Colorado to purchase their alcohol.

Wyoming is one of 17 “control states,” meaning that the state has a monopoly over the wholesaling or retailing of some or all alcoholic beverages.

Sen. Anthony Bouchard, R-Cheyenne, said the bill’s supporters seemed to imply that alcohol was bad, yet the state has a monopoly on selling it.

“We’re not saying alcohol is inherently bad,” Scott replied. “We’re saying that it has a risk and somebody has to pay the price of it. That risk should be taxed.” 

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What if coal production drops to zero? Legislature looking for new revenues

Published on in Government spending/Energy/News/Taxes
Electricity
2270

By Laura Hancock, Cowboy State Daily

Coal production in Wyoming has dropped by over 100 million tons in the past decade, and state Sen. Cale Case doesn’t think the downward slide is close to finished.

“There isn’t a scenario where it turns around, where the decline stops,” said Case, R-Lander, a co-chair of the Wyoming Legislature’s Joint Revenue Committee. “No one can articulate that.”

That will likely spell trouble for state coffers, which are dependent on coal revenue to pay the bills.

What if coal production trickled down to zero? It’s not entirely a hypothetical question these days, considering PacifiCorp’s recently announced draft plan to retire coal plants early.

Fueling state accounts

Wyoming coal producers pay severance taxes, federal mineral royalties, coal lease bonus revenues and ad valorem taxes at various points of the mining process, which flow to different state, education and local government funds. But each revenue source has decreased in the past 10 years:·      

  • Severance taxes: In 2009, mining companies paid the state $273.3 million. In 2018, they paid $198.8 million. In 2024, state projections show they could pay $185.9 million.·      
  • Federal mineral royalties, which are divided between the federal and state governments by 51% and 49% respectively: Wyoming received $262.5 million in 2009 and $198.1 million in 2018. Federal data didn’t contain royalty projections for the future.·      
  • Coal lease bonuses, which have funded Wyoming’s ambitious school construction program, were $213.6 million in 2009 and $5.3 million in 2018. From 2019 to 2024, the state estimates $0 from the bonuses, collected when mining companies pay for expanding operations on federal land. There are no expectations that mines will expand operations in the near future. ·      
  • Ad valorem taxes, assessed on the value of coal and paid a year after the assessment: Coal companies paid taxes on $3.8 billion in 2009 assessed valuations. They are expected to pay taxes on $2.8 billion in 2018 assessed valuations. By 2024, state projections show valuations falling by another $100 million to $2.7 billion.

The total income from severance taxes, federal mineral royalties and coal lease bonuses dropped from $749.4 million in 2009 to $402.2 million in 2018.

Case notes these figures don’t include sales and use taxes companies pay for items small and large — ranging from paper for copiers to tires for haul trucks.

“We don’t get the sales tax on stuff they buy,” he said. “Because they’re not buying much anymore.”

Replacement revenues

As Revenue Committee co-chair, it’s Case’s job to consider ways to make up for lost coal revenue.

“That’s a big lift,” he said. “It’s a lot of money.”

True, oil and gas continue to bring Wyoming revenue – but not enough to replace coal. And it’s entirely possible, with market concerns about global climate change, that new restrictions could kill demand for those fossil fuels.

Among proposals before the Joint Revenue Committee:      

  • The committee advanced a proposal in September that would create a corporate income tax of 7 percent on companies with at least 100 shareholders – in other words, businesses not generally headquartered in the state. The revenue created would be around $20 million to $25 million a year, Case said. It’s not a replacement for coal, but a start. A similar measure failed earlier this year in the Legislature.
  • Changes to property taxes, including: An increase in the statewide mill levy for schools, increases in some property taxes, and creating a new property tax class for multi-million dollar homes.
  • Wyoming taxes wind $1 per megawatt hour. Case would like to see it increased. Case would, in general, like to impose an electricity export tax. “Wyoming’s biggest export is electricity,” he said. At this point, there is no bill draft before lawmakers.

Many conservatives have said they want to see cuts to state government before looking to raise taxes.

“Here’s what I tell people: you’ll get your cuts,” Case said. “We’re going to have to cut like crazy. And we’re still going to need revenues. This is very serious. We’ve never faced anything like this.”

Ongoing discussions

The Wyoming Taxpayers Association, which represents many of the companies that would be affected by a corporate income tax, didn’t support the idea in the Legislature earlier this year. Its leadership hasn’t yet decided on its position on the bill currently under consideration, said Ashley Harpstreith, the organization’s executive director.

The Wyoming Taxpayers Association will be discussing the state’s revenue picture at its annual meeting next month. 

“The point is we’re going to have to have those hard conversations,” Harpstreith said. “It’s coming to a head. Industry has been paying the bills for a long time.”

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Governor Gordon talks taxes

Published on in News/Taxes
Gov Gordon Taxes
2218

By Cowboy State Daily

Wyoming must prioritize the work that needs to be done on its roads before it considers raising gasoline taxes, according to Gov. Mark Gordon.

Gordon, speaking during a news conference Tuesday, said he is taking a “wait and see” approach to the 3-cent per gallon fuel tax increase recommended by the Legislature’s Joint Revenue Committee for consideration during the Legislature’s 2020 budget session.

Gordon said the state has a $165 million gap between income for road maintenance and repairs and the estimated cost to keep the state’s roads up.

“We’re not going to go crazy on trying to figure out revenue to fix all that,” he said. “I think part of the conversation has to be how do we prioritize the roads and how do we make sure people in Wyoming understand what we won’t be able to do before we start saying how we’re going to raise taxes.”

While Gordon said he is not a fan of a proposed corporate income tax the Joint Revenue Committee will submit to the Legislature, he might be able to support a statewide lodging tax, a proposal that died in the 2019 legislative session.

“If it seems to be well targeted and not generally affecting Wyoming’s population, I think I would be generally supportive of that,” he said.

On other issues, Gordon said he is concerned with the growing use of “vape” products by Wyoming’s teens and is working with the state Health Department to study options to deal with the issue.

“It does seem to me it doesn’t make sense for us to sell vaping products to anyone under 21 years of age,” he said. “This is an area the Legislature should look into. But from my standpoint and whether I would issue an executive order, I’m looking at those policies, too.”

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Zwonitzer: Time for Legislature to study gas tax increase

Published on in News/Transportation/Taxes
2138

It is time for the state to study a possible increase in gasoline taxes, according to the co-chairman of the Legislature’s Revenue Committee.

Rep. Dan Zwonitzer, R-Cheyenne, said the proposed 3-cent per gallon tax increase approved by the Revenue Committee in July should definitely be reviewed by the Legislature when it meets in 2020.

“The last actual tax that the Legislature has increased, the only tax in my 15 years, has been the gas tax,” he said. “And it’s probably time again.”

The 3-cent increase would boost Wyoming’s total tax on gasoline to 27 cents per gallon and raise an additional $20 million per year. Under the proposal forwarded to the Legislature by the Revenue Committee, $13.5 million of that would go to the state Department of Transportation to build and maintain roads, while $6.5 million would be split between city and county governments.

Zwonitzer said the increase, which would leave Wyoming’s total gas taxes among the lowest in the region, would help offset some of the Department of Transportation’s deferred maintenance costs.

“But with hundreds of millions of dollars in deferred maintenance needed, the 3 cents is really just kind of a chip in the bucket,” he said.

The state last increased gasoline taxes in 2014, adding 10 cents to the price of a gallon of gasoline.

Cassie Craven, of the Wyoming Liberty Group, said she wondered what the money raised by the last increase had been used for.

“I’m wondering where that money went,” he said. “We heard back then we wouldn’t feel it at the pumps and gas prices don’t seem to indicate that. So where did the money go?”

The Wyoming Taxpayers Association, Wyoming Truckers Association and Petroleum Marketers Association have all said their members would support the increase as long as the extra tax is not tied to inflation.

The Wyoming Farm Bureau is on record as opposing the tax because of the expenses it would add to farming operations.

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Revenue Committee looks again at corporate income tax

Published on in News/Taxes
2062

A legislative committee is once again studying a proposal to impose an income tax on so-called “big block” stores.

The Legislature’s Joint Revenue Committee will take testimony on the proposal during its meeting in Pinedale this week. Members will decide whether to forward the bill to the Legislature during their meeting in November.

Under consideration is a measure similar to one killed in the Legislature this year. It would impose a 7 percent corporate income tax on companies with more than 100 shareholders.

In debates on the bill during the Legislature’s general session earlier this year, backers said national companies that do business in Wyoming have already built the cost of corporate income taxes assessed in other states into the price of goods sold in Wyoming. Supporters said the new tax would simply amount to Wyoming collecting its share of those taxes on purchases made in the state.

The measure is expected to bring another $45 million into the state and Tammy Johnson of the Wyoming Education Association said the money would go a long way toward funding education.

“(It is) the equivalent of funding 600 teaching positions for one year,” she said. “It’s the equivalent of funding a (Class) 3A school district for one year. It’s a lot of money. And it’s needed by the people of Wyoming to fund education, which is a fundamental right in Wyoming.”

Chris Brown of the Wyoming Retailers Association said his group just wants the Legislature to make sure any tax measure adopted is fair to all.

“Not one that picks winners and losers and treats businesses competing for the same customers different on a tax basis,” he said.

Johnson said since the companies that would be affected by the tax are already building the cost of taxes into their products, it just makes sense for Wyoming to collect its share of the revenue.

But Brown disagreed.

“To suggest that this is a tax that’s already being paid and Wyoming is just going to get its share back is incorrect,” he said. “Make no mistake, this is a brand new tax that, if this bill is passed, will be applied to some businesses in Wyoming and very well could translate down to the consumer.”

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Peterson: How to fix Wyoming’s revenue struggles

Published on in Government spending/Column/Taxes
Wyoming Government spending
1902

By R. Ray Peterson, guest column for Cowboy State Daily

While serving in the Wyoming Senate, I had the privilege of serving on both the Appropriations Committee for six years and as chairman of the Senate Revenue Committee for six years.  These two committees deal with the state budget through expenditures and revenues.

As I served, I was able to attend many state and regional meetings as well as review reports, and studies, all while having direct involvement in directing expenditures and revenue streams of our state.  These experiences allowed me insights and knowledge concerning our states budget along with growing concerns of revenue streams and how we will meet the expectations of funding state and local governments into the future.

The most recent developments of our coal industry in Wyoming should be setting off alarms with every elected official and citizen in our state.  Over the years, our state’s natural resources have subsidized a major portion of our taxes or revenue streams that we use to fund our schools and governments.  Over half of all revenues used to meet these expenses come from our mineral extraction industry. 

Learning from our history of our boom and bust cycles, our legislature has wisely put aside additional revenues from the high years to assist us during the low years.  This philosophy has served us well for the past 50 years in providing a more consistent budget, but the times, “they are a changing.”  The question now is, how long before our reserves are depleted?  Will our natural resources come back as they have in the past to save us yet another time? 

Wyoming, by our state’s constitution, must have a balanced budget.  Some would argue that we do not deficit spend in Wyoming while others would argue that we use the reserves to balance the budget which is, in a sense, deficit spending.  From my own simple understanding, when we spend more in a period than we take in, it is deficit spending. 

Although our budget is balanced in the end, we are still spending more than we take in during our low years.  Thanks to our cash reserves or “rainy day” funds and our investments, we seem to be holding our own while hoping that the revenue streams will return to higher levels. 

Today’s challenges are different

But today’s challenges to the budget are different than our past experiences of our boom and bust cycles.  Today, we face the strong possibility that coal will never come back to contribute to our revenues as it once did for our state.  The market has changed.  The demand has changed.  Unlike natural gas and oil, coal was a more consistent contributor to our states revenues with even slight increases from year to year, as amounts extracted increased with what the market demanded. 

But the demand for coal is decreasing for different reasons.  Although Wyoming has stepped up to produce cleaner burning coal technology to protect our coal’s value, other factors have weighed in that have had a dramatic effect on the value of coal. 

The war on coal was real and certainly had its effect.  More power plants have converted from coal fired to natural gas fired power generation.  But more importantly, consumer states of energy, such as California and others, have required energy supply companies to provide evidence that a majority of their power generation portfolio is derived from renewable sources such as hydro, wind and solar, or they will go elsewhere for their energy purchases.  The market is changing and because of this, Wyoming should be prepared and adapt with those changes.

Action is required

There are two principles used when budgeting in a shortfall.  Increase revenues or reduce expenditures.  Wyoming has done both without raising taxes. And there are other good things the state has done and continues to do.  As I mentioned, it participates with private energy corporations in developing clean coal technology as well as other cleaner burning fossil fuel efforts.  It also participates in the effort to develop new markets for our coal.  It has worked to create more transmission lines to deliver our natural gas and oil to market areas. 

These are things our state has done to try and increase or stabilize our revenues by strengthening the current resources we have.  The state has also used excess revenue of the good years to save and invest.  These investments, at times, provide additional revenues that are used to fill the budget holes left from the decreasing value of our market driven resources.  This effort combined with savings, have provided a long-needed stabilizing influence on our past boom and bust budget cycles.

Our challenge today

Our subsidy by mineral taxation has lightened the tax burden on Wyoming citizens over the years, but it has taken a hit, creating a shortfall.  The savings and investment of those savings are currently filling the shortages, allowing our state and local leaders time to make adjustments to their budgets. 

But reserves shrink and investments don’t always perform consistently.  The investment portfolio that perhaps saved our budget the year before could generate nothing the following year.  Trusting our trust funds is not the long-term solution to our shortfall problems. 

Most will argue that we need to reduce our expenditures.  I certainly agree with this position.  As with our own home budgets, we make less, we should spend less.  It should be no different with our state budget and over the last few years the state budget has been reduced in most areas.  But these are all short-term solutions to our current situation. 

What needs to be brought to the table are long-term solutions.  The solutions need to address the real problem of an inconsistent revenue stream, where nearly 60 percent of current revenues collected are market driven or out of our own control.  Wyoming needs to meet the challenge of reducing that market driven 60 percent, to 50 percent or even 40 percent of total revenue collected by the state. 

Now the question should be; How do we do this?

It’s time

By applying the two principles of budgeting in a shortfall of raising revenue and reducing expenses, I’ll offer one revenue increasing idea and two reducing expenditures ideas. 

A good start to the effort of stabilizing our revenue stream would be to pass a bill increasing the statewide lodging tax.   This increase would have the lowest effect on our tax payers and would be consistent to what surrounding states charge.   

For my ideas of reducing expenditures, I would suggest eliminating the $15 million annual automatic escalator for funding K-12 education.  I would also zero base the Department of Education budget and the Department of Health budget every ten years in the appropriations committee.  Stagger them to spread out the work load, but the two largest budgets in our state need more legislative scrutiny. 

These actions would be a good start in stabilizing our budget in Wyoming.

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Tax numbers cast doubt on assumption of tough times

Published on in News/Taxes
Wyoming economy
1820

By Bill Sniffin, Cowboy State Daily

Poor Gillette obviously is in the doldrums from mines closing. Poor Casper with all the downturns in the energy industry, is certainly lagging, right?

Not necessarily.

If you go by taxable retail sales, the conventional wisdom that Wyoming, as an entire state, is hurting just is not true.

The map showing the ups and downs of taxable sales for the first three months of 2019, compared to 2018, shows a far different story than what folks around Wyoming seem to believe.

Douglas and Converse County sales tax collections have increased by 64 percent, year-over-year.

Rawlins and Carbon County collections are up 31.7 percent, followed by Buffalo and Johnson County with gains of 31.1 percent and Rock Springs and Sweetwater County with an increase of 30.8 percent.

Cheyenne and Laramie County collections were up by 16.4 percent.

Gillette, with all its woes, saw collections increase by 12.7 percent in 2019 over 2018. And if those two mines are bought and the workers go back to work, things are going to be just fine in Campbell County.

Casper and Natrona County tax collections increased by 14.2 percent in 2019 over 2018.

So if all these places are doing so well, who is not showing an increase?

Pinedale and Sublette County have seen the steepest decline in tax collections, down 25.5 percent, which echoes the current slide in the natural gas production.

Lander and Riverton in Fremont County saw a collections decline of 7 percent.

Big Horn County (Greybull, Basin, Lovell) saw tax income drop by 6.4 percent and Thermopolis and Hot Springs County declined by 3.5 percent.

Laramie and Albany County are holding their own, down just 0.3 percent from 2018 and Lusk and Niobrara County are down by 1.5 percent.

Note: Please check out our additional story in the Cowboy State Daily featuring comments from folks living in these cities and towns.

Revenues ahead of estimates, though structural problems remain

Published on in Government spending/News/Taxes
Wyoming taxes
1811

By Laura Hancock, Cowboy State Daily

Sales taxes, investment income, oil severance taxes and federal mineral royalties are proving to be the saving grace for state coffers, according to a recent report, but the overall revenue picture for Wyoming remains bleak.

In the first six months of the year, production of natural gas and coal – as well as prices for coal – came in below the state’s official forecast, according to the Census Revenue Estimating Group, made up of revenue experts from the legislative and executive branches of Wyoming government. 

CREG recently released a six-month revenue update for Wyoming, and compared those revenues against its previous official state forecast, released in January. 

At one time, coal and natural gas were counter-cyclical – when one was down, the other was up – which helped Wyoming absorb the booms and busts of a natural resource economy, and money continued to flow to keep state government running. 

But the July 31 CREG update underscored a new reality: Production of both commodities was down, and the income for two accounts that fund most day-to-day operations in state government would have also missed estimates had it not been for other forms of revenue. 

Revenue receipts to the General Fund, which is something of a state checking account, were $201 million or 16.9 percent ahead of earlier forecasts for the year due to higher-than-anticipated sales tax, investment and oil severance tax income.  

Receipts to the Budget Reserve Fund, which is akin to a state overdraft account, were 6.7 percent ahead of projections, thanks to severance taxes and federal mineral royalties. State Rep. Dan Zwonitzer, R-Cheyenne, said that Wyoming can’t always count on high returns on investments. 

“Future projections for investment returns are nowhere near where they’ve been the last four years,” he said. “They’re looking at 5.5 percent, 5.25 percent (rate of return) for the retirement system. We have some serious problems ahead of us.”

Zwonitzer is a co-chair of the Legislature’s Joint Revenue Committee, which is studying whether to implement new taxes, such as a corporate income tax or a gross receipts tax. 

The difference between the two? A corporate income tax is assessed on business profits, or income. Gross receipts taxes are levied on sales. 

Companies don’t pay corporate income taxes if their profits are zero or negative. But that’s not true with gross receipts taxes, according to the conservative Tax Foundation.

Forty-four states have a corporate income tax and four have a gross receipts tax, Zwonitzer said. 

Other taxes under consideration: 

  • A higher assessment against wind power generation
  • An increase of the statewide mill levy for schools
  • Increases for some property taxes
  • Adding a fourth category of property taxes – currently there are residential, commercial and industrial – which would consider multi-million dollar residential homes. “That would require a constitutional amendment,” Zwonitzer said. 

However, tax talk is tough in the Cowboy State, where people are conservative and used to one of the nation’s lowest tax rates. Previous tax proposals – such as requiring taxes be assessed on services including haircuts, real estate transactions and legal services – went nowhere. 

“Some in the Republican caucus say we need to be cutting services more before raising taxes,” Zwonitzer said. “They can’t identify where those cuts are” outside of education. 

Revenue bills must first be introduced in the House, where Zwonitzer said many proposals will likely gain the two-thirds vote necessary to clear introduction and be referred to a committee on budget years, such as the 2020 session. 

“I think we’re going to have some good discussions,” he said. 

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Wyoming Legislature’s tax panel draws a crowd

Published on in News/Taxes
1599

Wyoming’s legislators are examining several proposed new taxes and changes to existing taxes as the state’s coal industry continues its decline.

Members of the Revenue Committee, meeting in Cheyenne on Monday, reviewed several proposals that have been rejected by the Legislature in the past, including changes to the state’s wind energy tax, an increase in fuel taxes and a tax on large national retail stores.

Dan Zwonitzer, R-Cheyenne, the committee’s co-chair, said it is important that the committee study all options available to it to keep the state’s revenue stream stable, even if those options are unpopular.

“We’re going to be bringing something (to the Legislature’s 2020 session) and people probably won’t like it,” he said. “People don’t like taxes.”

The recent closure of two major Wyoming coal mines owned by Blackjewel indicates that it is time for the state to plan for different levels of coal production and how that will affect the state’s revenues in the future, said Buck McVeigh, acting chief of staff for Gov. Mark Gordon.

“The strife that’s facing our coal industry and that steady revenue player that we always counted on during the tough times with oil and gas, we’re losing that,” he said.

One proposal being considered is a corporate income tax that would be assessed against large retail stores with headquarters outside the state. Dubbed the National Retail Fairness Act, the tax is designed to account for the fact that the cost of goods sold by such retailers often includes an element for corporate income taxes assessed in other states. Backers maintain the measure would let Wyoming collect its fair share of the taxes paid by its residents.

The proposal was rejected by Wyoming’s Legislature during its recent general session and Senate Vice President Ogden Driskill, R-Devils Tower, said he is not sure any more support exists for the measure going forward.

“Some things just don’t know when to die and they get revisited and revisited,” he said. “That came out of left field pretty fast last year. I don’t think there was good understanding on either side of it.”

The measure has the support of the Wyoming Education Association because of the $40 million to $45 million it could raise annually.

“The National Retail Fairness Act is one step in the right direction to increase funding for schools,” said Tammy Johnson, the WEA’s government relations director.

The Revenue Committee continued its meeting Tuesday.

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Wyoming’s 65th Legislature: General Session Review

Published on in News/Health care/Taxes/Education/Agriculture/Criminal justice
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It’s all over for this year. Check out our bitesized rundown of what passed and what failed in the 65th Wyoming Legislature’s General Session. Stay tuned this weekend for more analysis on the session highs and lows with our Robert Geha.

Thanks for watching and be sure to follow Cowboy State Daily for our expanded statewide coverage of Wyoming news coming to your feed in the days ahead.

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House begins final day by killing three bills

Published on in Government spending/News/Health care/Taxes
Graduates toss their caps in the air, ALT=Wyoming to offer bachelors degrees at community colleges
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By Cowboy State Daily

The first three bills to be reviewed by Wyoming’s House on what was scheduled to be the last day of its 2019 general session did not fare well on Wednesday.

Bills addressing Medicaid eligibility, the payment of sales tax on large construction projects and the role of the state Select Committee on School Facilities in construction projects all died in their third and final reading on the House floor.

However, a bill designed to encourage students to pursue technical courses at the state’s community colleges was approved, as was a bill that would allow community colleges to offer bachelor’s degrees in applied science.

The Legislature scheduled itself to end its session on Wednesday. Legislators spent much of the day addressing Gov. Mark Gordon’s veto of 14 footnotes to the supplemental budget.

The House was the only chamber with regular business left to address — eight bills on third and final reading.

But SF 103, 114 and 144 all died on their final votes.

SF 144 would impose requirements for those receiving Medicaid assistance to either work, attend school or complete volunteer duty. The bill, which died on a vote of 39-20, would have exempted those with serious medical problems from the requirement.

SF 103 would have expanded the role of the Select Committee on School Facilities to oversee community college and state capital construction projects. It died on a vote of 51-8.

SF 114 would have allowed companies building industrial facilities to work out contracts for the payment of sales and use taxes on those facilities over 20 years. It was killed in a vote of 33-25.

However, in a session that ran well past 7 p.m., representatives approved SF 111, a bill that would let community colleges offer bachelor’s degrees in applied science, approving the measure on a vote of 51-8.

Also approved was SF 122, a bill that would provide grants for students wishing to pursue technical programs at community colleges. Dubbed the “Wyoming Works Program,” it would also provide funding for community colleges to offer such programs. Students would not be required to have a high school diploma to take part in the program.

SF 134, a bill that would provide exemptions for some oil and natural gas production from wells that had been shut down and then restarted, was also approved.

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Senate kills lodging tax bill

Published on in News/Taxes/Tourism
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By Cowboy State Daily (updated Feb. 25, 2019 at 7PM)

A measure that would have imposed a statewide 5 percent tax on hotel and motel stays was killed by the Senate on Monday.

Senators voted 19-7 against HB 66, a measure seen as a way to finance the state Tourism Division without dipping into the state’s main bank account.

The bill would impose a 5 percent lodging tax across the state. Money from  percent of the tax — estimated at $19 million a year — would have been used to pay for the activities of the state Tourism Division. The division would have received no more money from the state’s main bank account, called the “General Fund.”

The money from the other 2 percent of the tax would have gone to counties to replace tax income lost when their local lodging taxes expired.

Supporters promoted the statewide tax as a way to collect money from visitors to Wyoming to pay for tourism promotion. But opponents questioned the cost the tax would add to the expense of a hotel or motel stay.

Income tax, party switching dead, lodging tax alive

Published on in News/Taxes/Criminal justice
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By Cowboy State Daily

The last of three bills that would have put restrictions on when voters can change party affiliations was among a number to die this week as the Legislature neared the end of its general session.

Legislators looking to wrap up their general session by Wednesday put in long hour this week finishing their work on a number of bills, eliminating several controversial measures.

HB 106 was the last of three bills that would have set time limits for people to change party affiliation. It would have set a deadline of May 1 for such changes. It was defeated in a 14-11 vote in its first Senate review.

Another bill killed would have imposed an income tax on large retail companies headquartered outside of Wyoming. HB 220 died without getting a review in a Senate committee.

Moving ahead, however, was a bill that would set a statewide lodging tax of 5 percent. HB 66 is set for a final vote in the Senate on Monday.

Approved with significant changes by the Senate was a bill originally designed to create a felony crime for animal abuse. HB 235 was amended to remove all language about the felony crime.

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Lodging tax bill moves forward in Senate

Published on in News/Taxes
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By Cowboy State Daily

A bill that would impose a statewide 5 percent tax on hotel and motel stays was approved in its first Senate review on Thursday.

HB 66 is set to receive a second reading Friday after senators voted 16-11 to approve it during the Senate’s “Committee of the Whole,” the full body’s first chance to review the bill.

If approved, the bill would require that money from 3 percent of the tax — about $19 million a year — go to the state Tourism Division. The division would no longer receive money from the state’s “General Fund,” its main bank account

Money from the other 2 percent would go to counties to replace income from their own lodging taxes when they expire.

Sen. Cale Case, R-Lander, tried with an amendment to eliminate the extra 2 percent tax, saying that would make hotel stays too expensive for in-state travelers.

“It’s just making it more expensive to stay around Wyoming,” he said.

But Sen. Bill Landen, R-Casper, successfully urged the Senate to kill Case’s amendment, arguing local communities should be provided with a steady source of income to promote themselves.

“That allows for local communities to have a little bit of leverage,” he said. “Let’s give it to them.”

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Senator says discussion of Wyoming’s tax structure must continue

Published on in News/Taxes
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By Cowboy State Daily

Attempts to change Wyoming’s tax structure must continue despite the defeat of a bill that would have created a corporate income tax, according to a legislative leader.

HB 220, called the “National Retail Fairness Act,” would have imposed an income tax on corporations such as large retailers that do business in Wyoming but have their headquarters in other states. 

But the measure encountered significant opposition and the Senate Corporations, Elections and Political Subdivisions Committee declined to review the bill before a Wednesday deadline for committees to finish their work.

Committee Chair Sen. Bill Landen, R-Casper, said he never brought the bill up because there was very little chance for it to win Senate approval.

Landen said discussions of how to change Wyoming’s tax structure must continue, even though many ideas raised will not be popular.

“That’s going to be difficult every single time we bring a bill like this one because everybody believes in that, they just don’t want it done in their backyard,” he said.

Backers of the bill in the House, where the bill was approved by a vote of 44-14, said it would have given the state a tool to get its share of the taxes already built into the cost of products.

“I thought it was a good tool for Wyoming to get some of the money from the big box stores that they’re already scheduled to pay,” said Rep. Bunky Loucks, R-Casper. “And they don’t really participate in the tax base of our state.”

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In Brief: Corporate income tax bill dies without committee review

Published on in News/Taxes
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By Cowboy State Daily

A plan to impose an income tax on large companies that do business in Wyoming but are headquartered elsewhere died in a Senate committee on Tuesday.

HB 220, referred to as the National Retail Fairness Act, was not considered before a deadline for the Senate Corporations, Elections and Political Subdivisions Committee to finish its work on bills.

For any bills to be considered in the Senate, they have to be reported out of committee by Wednesday. Although the bill was on the Corporations Committee’s schedule for consideration Tuesday, it was not brought up before the end of business The Corporations Committee is not scheduled to meet again before the deadline.

The bill had been seen as a way for Wyoming to tap into a revenue source from large retailers. Supporters argued that such retailers build in the cost of income tax in other states into their prices and then do not discount those prices in states that do not have an income tax — such as Wyoming. The corporate income tax was seen as a way to collect the tax that was not being paid to the state.

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Updated: Lodging tax bill narrowly clears committee

Published on in News/Taxes/Tourism
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By Cowboy State Daily

A measure that would impose a statewide tax on all hotel and motel stays is headed for the Senate floor after clearing a committee on Tuesday.

HB 66, which would impose a statewide 5 percent lodging tax, won approval on a 3-1 vote from the Senate Travel, Recreation, Wildlife and Cultural Resources Committee. The bill now heads to the Senate floor for review by the full body.

Money from 3 percent of the tax — estimated at $19 million per year — would go to the state Tourism Division to finance its operations. The division would no longer receive funds from the state’s main banking account, the General Fund.

Revenue from the other 2 percent would be sent to communities to replace local lodging taxes when they expire.

The bill’s committee approval was welcomed by members of the tourism industry, who said Wyoming needs all the financial help it can get to lure visitors to the state.

“Montana, Colorado, Utah, they outspend us by almost double in some instances and tourism is a competitive business,” said Chris Brown, director of the Wyoming Restaurant and Lodging Association. “We’re just looking to grow our slice of the pie for Wyoming’s visitor economy.”

Committee member Sen. Lisa Anselmi-Dalton, D-Rock Springs, declared a conflict and did not vote on the bill because she owns a hotel in Rock Springs.

Anselmi-Dalton also said she is not a supporter of the tax because of the burden it puts on business owners.

“It’s a pretty heavy lift for some people,” she said. “When I put things out to bid at my hotel, (clients) say ‘This is my budget’ and I end up eating the tax.”

The vote came as legislators approached a deadline to address the bills in front of their committees. All committee work must be completed by Wednesday.


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Bonus plan for investment pros good way to build team, Meier says

Published on in News/Taxes
Interview with Wyoming State Treasurer Curt Meier
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A plan to reward the state’s investment officials for good decisions will help the state build and maintain a team of skilled investment professionals, according to state Treasurer Curt Meier.

Meier, in an interview with Cowboy State Daily, said Friday the plan put forward by HB 222 would encourage smarter investments of state money, which in turn could help the state weather the fluctuations in energy prices.

“We need to attract and maintain a great team of investment people for the state of Wyoming,” he said. “If we can do our just to get (investment returns) to the median of what other states are doing, we can fix the budget crisis in our state.”

HB 222, which is awaiting the signature of Gov. Mark Gordon to become law, would reward investment professionals with a bonus equal to a percentage of their salaries if their investments exceed certain market benchmarks.

The bonus size would fluctuate based on the investment professional’s position. For instance, the state’s top investment officer, Patrick Fleming, could double his salary of $250,000 for good performance.

The bonuses would be paid out over three years to encourage investors to remain with the state. If they left state employment before the end of the three-year period, they would forfeit the remainder of their bonuses.

“We don’t want people to get into the hit and run attitude,” Meier said. You can have somebody … run way out on the risk cycle just to get his bonus and pick up his check and leave.” The arrangement will also help encourage investment officers to make prudent decisions so they are not fired, Meier said.

Good investment officers look not only at returns, Meier said, but the risks involved. For instance, he noted some corporation in recent years have been borrowing money so they could buy back their own stock.

“You have to figure out what those underlying things are that aren’t apparent to everyone,” he said. “You have to get the right people to do the right study, the right analysis. It’s not just the returns, it’s the risk-balanced returns.”

The bonus plan could eventually allow the state to reduce the fees it pays to investment firms, now estimated at $60 million to $80 million a year, Meier said, by increasing the number of talented investment professionals inside the state.

“We’re probably in the bottom 2 percent of what people are paid (nationally),” he said. “That’s why we’re trying to build the team with in-state people. We’re trying to grow our own here. Because it’s har to get somebody from outside who doesn’t like the bright lights and big city.”

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Wyoming Legislature: Where they are

Published on in News/Taxes/Education
Wyoming Legislature bill analysis where they are
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By Cowboy State Daily

Here is a look at the status of some of the bills being considered by Wyoming’s Legislature during its general session:

  • HB 14 — Creating the “Mountain Daylight Savings Time” zone for Wyoming. Defeated in Senate “Committee of the Whole.”
  • HB 38 — Raising legislative expense reimbursements from $109 per day to $149. Awaiting governor’s signature.
  • HB 52 — Giving preference to Wyoming-made products in furnishing state buildings. Awaiting governor’s signature.
  • HB 66 — Setting a statewide lodging tax of 5 percent. Introduced in Senate, referred to Travel, Recreation, Wildlife and Cultural Resources Committee.
  • HB 71 — Raising the penalty for violating equal pay rules to $500 per day. Awaiting governor’s signature.
  • HB 140 — Imposing a 48-hour waiting period to perform abortions. No action will be taken in Senate committee before the end of session.
  • HB 145 — Eliminating the death penalty. Killed in Senate “Committee of the Whole.”
  • HB 192 — Requiring photo ID to vote. Killed on third reading in House.
  • HB 220 — Imposing an income tax on out-of-state companies with business locations in Wyoming. Introduced in Senate, referred to Senate Corporations, Elections and Political Subdivisions Comittee.
  • HB 251 — Authorizing Wyoming to sue the state of Washington over it refusal to allow the construction of a coal port. Introduced in Senate, referred to Senate Minerals Committee.
  • HJ 1 — Asking the federal government to delist the grizzly bear. Awaiting governor’s signature.
  • SF 46 — Limiting the length of a prescription of opioids to 14 days. Introduced by House, referred to Labor, Health and Social Services Committee.
  • SF 57 — Setting a deadline for the release of public documents by government agencies. Approved on second reading in House.
  • SF 119 — Making all expenditures by the state auditor’s office public and available for review. Introduced in House, referred to House Appropriations Committee.
  • SF 129 — Repealing requirements for reports from the state Department of Education. Joint conference committee appointed to resolve House and Senate differences.
  • SF 148 — Allowing the state to seize and operate federal facilities — including national parks — under certain conditions. Killed in House Minerals Committee.
  • SF 149 — Creating a “Capitol Complex” around the state Capitol and giving the state building commission authority for planning in the area. Approved by House Rules Committee.
  • SF 160 — Requiring changes in voter party affiliation to take place two weeks before absentee ballots are distributed. Introduced in House, referred to House Corporations, Elections and Political Subdivisions Committee.
  • SJ 3 — Declaring Dec. 10, 2019, as Wyoming Women’s Suffrage Day. Signed into law by governor.

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Representative seeks cut in coal taxes

Published on in News/Taxes
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By Cowboy State Daily

A state representative is trying to bring coal taxes more in line with those assessed against oil and gas.

Rep. Tim Hallinan, R-Gillette, is proposing a cut in coal severance taxes from 7 percent to 6.5 percent, a reduction he said was warranted given the fact the coal industry has paid the state almost $1.2 billion in taxes in the last five years.

Hallinan said a 6.5 percent tax rate would bring coal closer to the 6 percent severance tax assessed on oil and gas.

“I saw this a an equity issue and a way we could strengthen the coal industry in my community,” he said.

The reduction would cut Wyoming’s severance tax income by an estimated $13.5 million per year, according to Legislative Service Office estimates.

Hallinan’s bill, HB 167, is awaiting a review from the House Revenue Committee.

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Tobacco tax dies in House committee

Published on in News/Taxes
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A measure that would have boosted taxes on cigarettes and other tobacco products was killed in a House committee on Monday.

The House Revenue Committee voted 5-4 to keep HB 218 from reaching the House floor The bill would have increased cigarette taxes by $1 per pack, from 60 cents to $1.60.

The measure was one of a number of bills introduced this session aimed at raising tax revenues. 

Rep. Dan Zwonitzer, R-Cheyenne, chairman of the House Revenue Committee, said the bills represent ways legislators are looking at avoiding a state budget deficit moving forward.

“Three years ago after the financial crisis hit Wyoming, we were still in crisis mode, tryng to see how far down we were going to go,” he said. “Now that we’ve stabilized, it’s time to say ‘How are we going to fix this decrease.’ We’re $350 million still in deficit and so that’s why you’re seeing a lot of tax bills this session. It’s to say long-term moving forward, how do we make sure we have a balanced budget?”

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