With recalibration in the rear view, educators and lawmakers prepare for budget session
Josh Galemore, Star-Tribune
Jeff Barkell talks with eighth-grade students in his leadership
seminar Thursday at Centennial Junior High in Casper. Education
will be among the key issues for lawmakers to consider when
Legislature convenes Monday.
After months of meetings and debates, lawmakers will reconvene in Cheyenne this week. And for the second straight year, education funding will be near the top of their to-solve list.
“I think the big one for me remains education,” said Sen. Bill Landen, a Casper Republican and member of two education committees. “I think it’s necessary to continue to have a policy discussion about where that funding model should be and where that budget level should be. That’s going to be a big one.”
The interim was not a quiet time for education. Two different committees set out with the specific goal of solving a pair of school funding deficits, one in operations and one in maintenance and construction. A third conducted a top-down review of the education funding model. Another was tasked with looking at revenues.
By far the most expansive — and, for many lawmakers, the most crucial — was the work of that third group: the Select Committee on School Finance Recalibration. Those lawmakers were tasked with looking at the school funding model, a process that cannot begin with the question of dollars spent. Still, some legislators hoped it would reveal efficiencies that could help chip away at a sizeable funding deficit.
It didn’t. Instead, the model that was presented to lawmakers as a potential replacement was $71 million more expensive. The committee unanimously voted to reject it. The next day, the Joint Revenue Committee — citing the “implosion” of recalibration — swiftly and in silence killed several tax-related bills.
That’s not to say legislators will walk into the session completely out of ideas. The Joint Education Committee is sponsoring a pair of bills that will impose cuts. One “tightens” the funding model in several places, lawmakers have said, to the tune of about $19 million in savings in the first year. The other, which similarly tightens up health care spending, would also provide cuts, though it’s yet unclear how much.
For now, those are the vehicles for education cuts. Landen and Sen. Dave Kinskey are in the process of drafting a bill — or bills — that will provide further cuts, though both have yet to be posted. Landen said that Wyoming’s K-12 budget has been cut by slightly less than 5 percent, which is half — or even less — of what other agencies have absorbed.
But educators and at least one lawmaker are hoping there won’t be cuts. Tens of millions have already been slashed from schools, and they say that recalibration proves that Wyoming isn’t spending lavishly on education.
“I really hope that we won’t be seeing cuts to education,” said Kathy Vetter, the president of the Wyoming Education Association. “I think there’s a possibility and that’s my hope, that our senators and representatives will put education first and that we will appropriately fund it.”
“The big issue or big issues surround funding, and I think you know we’re happy with the starting place,” said Brian Farmer of the Wyoming School Boards Association. “We would like to see the ending place be the same as the starting place, but that’s not always the case.”
Sen. Chris Rothfuss, a Laramie Democrat, echoed that sentiment. He warned against “draconian” cuts to education and predicted that wouldn’t happen.
“I think it’ll be us trying to find ways to finance our current system of education,” he said. “Looking around for diversions, internal savings, wherever else. I don’t see any significant cuts on the horizon.”
That’s not to say some lawmakers won’t look hard to cut more. Sen. Ray Peterson, a Cowley Republican and the co-chairman of the revenue committee, said at a recent meeting that he liked the idea of increasing class sizes. That’s been a popular topic in conversations and came up repeatedly in last year’s session.
It’s easy to tell why: Bumping up class sizes by just one student could mean a sizeable cut, potentially more than $40 million. On top of that, some lawmakers have argued, most school districts have more kids in classrooms than they’re supposed to anyway.
But, educators respond, that’s because they use more money to pay teachers and keep them in Wyoming.
Rothfuss said that in light of the recalibration findings, class size increases would be “indefensible” in court. That’s because the architects of the new, rejected model paired a class size increase with more money for salaries.
Cherry picking just the cut, Rothfuss said, would blow apart that recommendation and end with the state losing a lawsuit.
“I think lawmakers would just be salivating to take that,” he said.
Still, he expects to see a class size increase bill.
Speaking of litigation ...
After last session, when the deficit was much more significant and lawmakers had just passed more than $36 million in cuts, some districts were openly discussing suing the state. Four of the largest districts passed resolutions allowing them to do just that.
Given that much of Wyoming’s current education landscape has been shaped by lawsuits, it’s not a surprise. But lawmakers have said they’re not influenced by those threats.
“Obviously some (educators) are saying, ‘If we don’t like what we get, we’ll sue you,’” Senate President Eli Bebout said. “Well, sue us.”
In any case, the threat of lawsuits quieted over the interim. Whether that continues into this session and beyond remains to be seen.
“If there are significant cuts, I would not be surprised to see some type of litigation follow,” Farmer said. “And I don’t think that’s what we want. That’s not the best solution.”
“I think there are districts that are just waiting to see whether or not the Legislature does fund education,” she said.
Landen said he understood where the districts were coming from. But he said that the attitude on the Senate side of the Jonah Business Center is that schools need to make more reductions.
“I think all of our education professionals have become better aware of the depth and breadth of the problem,” he said. “Everybody’s been involved in the conversation. They were all there. There’s a better understanding of the magnitude that we’re facing. ... I hope that’s part of reason why it’s quieted.”
What about revenue?
A year ago, as the bust continued to gut the state’s coffers, lawmakers and officials across Wyoming were calling for the state to diversify its economy. Now that Wyoming is starting to pull its way out of an economic hole, it remains to be seen whether that talk will continue.
Speaker Steve Harshman has said diversions, pieces of the 1 percent severance tax, investment income and savings can help fill what deficits remain. A tax increase seems almost certainly off of the table, if it ever was: The Senate is staunchly opposed to it, and now that the deficit is smaller and recalibration failed to turn up school cuts, revenue hikes seem an even slimmer prospect.
“I’m not there yet,” Landen said. “Part of the reason is we were very careful over the last decade or so to put a lot of reserves away just for times like this.”
But while operations is in a better place, facilities remain in limbo. Lawmakers are looking at removing a cap placed on state royalties, but that could contribute $40 million, less than half and perhaps just a third of the annual cost of buildings. More may be filled by a piece of the severance tax pie, but that pie will be sought by more than just educators.
Even with the economy turning around, lawmakers should still discuss changing the tax structure, Landen and others said. Rothfuss has said in the past that if a large company were to come to Wyoming, it would pay no taxes beyond the property tax on its physical locations.
“I think our corporate tax structure probably needs to be looked at,” Landen continued. “If we bring in a big new company, because of the lack of taxes that they do pay, it may be a losing situation for Wyoming because by the time you’ve provided all the services and schooling to the people that work there, it might be a losing proposition simply because our corporate tax structure isn’t where it should be.”
“It’s an unhealthy structure that we’ve created,” Rothfuss added, “and the political appetite to deal with it now is diminished due to the fact that we’re all banking on oil coming back and saving the day.”