Casper’s leaders are hoping that last month’s $1.7 million sales tax fiasco will lead lawmakers to re-examine Wyoming’s tax reporting system — and one state senator said Friday that he plans to do just that.
“It’s very possible that I would bring a piece of legislation [forward] if we decide there is a fix to what took place,” said Sen. Bill Landen, R-Casper.
The city mistakenly received an additional $1.7 million in sales tax distributions after a Sweetwater County vendor incorrectly reported its taxes in Natrona County. The error occurred from October 2013 to December 2015 and was later detected during a routine audit, Kim Lovett, the administrator of the Department of Revenue’s Excise Tax Division, said last month.
After the state learned about the mistake, it deducted the money from Casper’s monthly sales tax distribution in July.
To soften the fiscal blow, Casper officials are taking a loan from the state that will give the city up to five years to pay back the money, Mayor Ray Pacheco recently told the Star-Tribune. But he said the situation is still far from ideal.
Landen said he’s still trying to learn all the facts and will be discussing the matter with officials at the Wyoming Department of Revenue and the Wyoming Department of Audit to see if they need additional resources and tools.
“I’m certainly going to try and lead an effort to look into every angle of this thing. We don’t want this to happen to any other county or municipality,” he said.
During the last legislative session, Landen said the state authorized adding two positions to both departments after realizing that previous cuts may have been too severe. Lawmakers have been trying to trim the budget, but Landen said it’s important to reach a balance.
The senator said he also wants to explore whether the sales tax system could be altered so that any county that experiences a significant change in sales tax figures year-to-year would automatically undergo an audit.
“I’m not saying that is the answer, but that’s one thing I thought of,” Landen said.
Rep. Tom Walters, R-Casper, said he agrees that lawmakers need to review the current system.
If taxpayers overpay the state, they only have a limited amount of time to notice the error and request a refund, said Walters. The representative said lawmakers should consider holding the state to similar standards.
“It is something that needs remedy,” he said.
Rick Kaysen, the executive director of the Wyoming Association of Municipalities, said he hopes lawmakers will find a way to improve the current system.
“It is not a frequent occurrence, but the old saying goes, sometimes once is just too often ... Towns and municipalities are expected to be accurate with their financial reporting and their audits and I think the same standard should be held for taxpayers,” he said.
Lovett previously explained that the Department of Revenue relies on vendors to correctly report information.
“This is a self-reporting system,” she said.
The administrator said there are no penalties for mistakes of this nature. She declined to identify the vendor and said tax return information is confidential.
But Casper City Councilman Dallas Laird identified the company as Solvay Chemicals last month while publicly discussing how the error will impact the city.
The councilman later told the Star-Tribune that he received the vendor’s name from an anonymous source and wants state officials to confirm or deny its accuracy.
Laird has questioned whether the error was intentional. The councilman said it would have been advantageous to the vendor to file in Natrona County because the sales tax is 5 percent. Sweetwater County’s sales tax was 6 percent from 2013 until April 1 of this year.
Solvay is an international chemical company with about 50 manufacturing, administrative and research facilities in North America, according to its website. Solvay Chemicals, Inc., in Green River is a major U.S. producer of soda ash from trona, a naturally-occurring mineral used in glass manufacturing.
Multiple attempts to reach the local site manager, Todd Brichacek, were unsuccessful. No company official returned a request for comment.
Lovett has repeatedly stated that the error was accidental.
“There was no benefit to them,” she said.
Casper wasn’t the only entity in Natrona County affected by the error. The Natrona County government collected an additional $366,000. Mills ($108,000), Midwest ($13,000), Bar Nunn ($69,000), Evansville ($80,000) and Edgerton ($6,000) also received more than they were due.