Lawmakers still worried about Wyoming’s revenue picture
The main revenue forecasting arm for the state of Wyoming called 2013 a solid year economically. Thanks to investments it means the state raised almost 350 million dollars over projections. But the Consensus Revenue Estimating Group or CREG says while this is great news, problems may be on the horizon. The legislative committee tasked with developing the state’s budget wants to be cautious. Wyoming Public Radio’s Bob Beck reports…
BOB BECK: The Joint Appropriations Committee is tasked with developing the next two year budget that will fund state government. When the CREG report first came out Governor Matt Mead viewed it as positive and was pleased that the state would not have to go through the exercise of cutting budgets as it did the last few years. He also urged legislators to spend some money on things such as raises for state employees and on one time projects such as roads. But legislators saw their revenue picture change dramatically when the economy tanked in 2008 and they are far from comfortable yet. In fact some…like Campbell County Representative Sue Wallis…says that the state needs to tread lightly.
SUE WALLIS: It looks better certainly than it has, but none the less, our long term projections are still troubling.
ELI BEBOUT: We don’t see the revenue supporting the growth of government 2,3, 4, 5 years out.
BECK: That’s Eli Bebout, the co-chairman of the committee. Bebout has been around. He served when the state’s revenues busted in the 80’s and 90’s and was there when cuts were made in the last few years. He’s a player in the energy industry and knows how the boom and bust cycle works. While there is hope that increasing oil production can make a significant impact in the state, he says federal regulations are making it difficult on all extractive industries. Since Wyoming gets most of its money from energy, he’s nervous about a lot of new spending. Bebout is not interested in reversing the cuts to government that lawmakers made in recent years, but he concedes that some spending is ok.
BEBOUT: If we would be reasonable we can stay within in a good responsible standard budget, I think we can see our way through this and who knows things might turn around and we may be ok.
BECK: But Bebout also knows that the state has some spending it must address. He says Health care issues will still be a budget concern, there is a tremendous need to spend more money for those getting developmental disability assistance, and the ongoing concern over education spending.
Lawmakers seem particularly spooked over that last piece. Coal is projected to bring in less revenue for the state and that could have a dramatic impact on education funding. Casper Representative Tim Stubson says changing markets and new regulations have been tough on the Coal industry and he says it’s already having an impact. The state is already expected to be down close to 300 million dollars in school capitol construction money next year.
TIM STUBSON: All these great schools we’ve built across the state have been funded by coal and it’s been these coal lease bonus monies that have done it. And you have this situation over the last few months where one coal lease wasn’t bid on at all…one was rejected and so this whole stream of revenue that we have been relying on seems to be drying up. And so we have some real serious thinking to do about how to continue to fund education, especially capitol construction in the future.
BECK: Stubson says the fear is that they’d have to raise taxes to pay for it. Another fund that gives him concern is the retirement fund for state employees that needs a serious infusion of cash to keep it safe in the future. Employees and employers will be asked to pay more, but Stubson says it might not be enough.
Lawmakers have saved money in hopes of having enough to pay for one to two years of government. Some like Senator John Hastert of Green River say they shouldn’t squirrel away so much money.
HASTERT: You know we have to save, savings is important, but do we have the right amount of savings and money working for people? My opinion is that we need to have a little more working for the people of Wyoming.
BECK: University of Wyoming Economist Anne Alexander says that the revenue picture looks good…not great…but far from dire. She says cuts certainly aren’t needed, but agrees that lawmakers should be cautious. But Alexander says they should address some important needs.
ANNE ALEXANDER: We are at a point now where some of the things we’ve had to put off because we had to be cautious about natural gas prices, coal, and so on. We can’t put them off forever, because it will take a bigger investment if we keep putting them off and for example if you think about highway spending.
BECK: Alexander says they are looking at slow steady revenue growth in the future, so she says it’s time to focus on what they need and put their money there. The Appropriations Committee will receive the governor’s proposed budget soon and will start looking at priorities in December. For Wyoming Public Radio, I’m Bob Beck.