CHEYENNE - During the administration of Gov. Mike Sullivan, the energy bust took cruel root with plummeting state revenues, followed by employee furloughs, hiring freezes and agency budget cuts.

One attempt to bolster the economy and generate jobs in the late 1990s was to accelerate the state's highway construction program. At the time, the highway department, now the Wyoming Department of Transportation, had substantial reserves, or fund balances, set aside to meet upcoming payment obligations.

But it takes time to build roads. And when the 1992 budget session rolled around, the highway fund balances still were on the healthy side. The lawmakers, faced with a large deficit to run other government agencies, were unable to build a balanced budget.

"We were under water," recalled Richard Miller, then director of the Legislative Service Office, now a vice president for government, community and legal affairs at the University of Wyoming.

The Joint Appropriations Committee hit the highway fund and the water accounts to help meet the constitutional mandate for a balanced budget.

Miller wrote the budget-balancing section of the budget bill that authorized the Legislature to divert up to $20 million from the highway department's earmarked stream of mineral severance tax money to the school foundation program. This diversion reduced the amount of state general fund money the JAC needed to finance public schools through the foundation program.

The entire $20 million wasn't needed to run the public schools that year. The amount diverted totaled $10.6 million.

It was the first but not the last raid on the highway fund.

Beginning in about 1991, government reorganization placed the Wyoming Aeronautics Commission under the administrative wing of the renamed Wyoming Department of Transportation.

"As a result, the department had to begin dipping into the highway fund to fund airport improvements and Aeronautics Commission administrative costs which in recent years have totaled about $5 million," said Bruce Burrows of WYDOT's public affairs office.

The Legislature continued to nibble on the highway fund:

* The Legislature diverted part of the new additional nickel in the tax on motor fuel to the school foundation program for four years from the 1999 through 2002 fiscal years. The total diversion amounted to $60 million. That money is no longer being diverted.

* The Legislature de-earmarked and capped the amount of mineral severance taxes and federal mineral royalties that flowed automatically into the highway fund starting in fiscal year 2002. The de-earmarking cost the highway fund $310 million for the first five years. The the caps or limits will cost the department an additional estimated $197 million in the upcoming two-year biennium.

* The Legislature changed the funding source for the Highway Patrol from the state general fund to the highway fund. This move cost nearly $3.5 million for the 2004 fiscal year, compared to the department's $800,000 cost for the patrol in fiscal year 1985.

* Another big hit came in 1994 with the expiration of the capital facilities tax on coal. The phasing out of the tax was partly responsible for the drop in mineral severance tax revenue to the highway fund from $21 million in fiscal year 1993 to $6.7 million in fiscal year 1996.

"We are not arguing whether the changes were appropriate, but we do track the losses to gauge their effect on the construction program," Burrows said.

During the last two legislative sessions, with improved revenues, the Legislature has helped shore up highway funding.

The lawmakers appropriated nearly $130 million in state money, including $75 million for surface transportation over three years, along with $11 million for multilane highways and $8 million for air service enhancements and airport improvements.

Over the years the department's top revenue sources have been federal aid, mineral severance taxes, federal mineral royalties and fuel taxes, with few state general fund dollars.

WYDOT's aniticipated revenue for fiscal year 2007: $473,582,873

Federal aid: 53.95 percent, $255,5110,160

Fuel taxes: 14.71 percent, $69,658,482

Royalties: 14.04 percent, $66,472,500

Registration: 10.71 percent, $50,721,106

Vehicle fees: 1.37 percent, $6,495,174

Severance taxes: 1.42 percent, $6,711,500

General funds: 1.06 percent, $5,037,210

Drivers licenses: 0.76 percent, $3,581,003

Source: WYDOT

Click on the headlines below for related stories.

'Highway funding fix requires huge investment, officials say'

'Lawmaker: Make I-80 a toll road'

'I-80 poses big burden'

'On the precipice: Wyo risks economy, way of life without highway funding fix, WYDOT says'

'Roads play key role in Wyoming life'

Capital bureau reporter Joan Barron can be reached at (307) 632-1244 or at joan.barron@casperstartribune.net.