Wyoming lawmakers will have only 20 days to work when they convene next year, but they could take up a number of daunting topics that they failed to resolve in the recently completed legislative session.
Some of the conversations in the 2020 budget session could potentially look similar to those held in this year’s session, where lawmakers defeated a bill on school safety and turned back multiple attempts to raise revenue for the state.
Those topics were among the most significant to emerge out of a list of 80 priorities contained in a number of letters to the Legislature’s Management Council ahead of its first meeting of the year on Friday in Cheyenne, where the bipartisan group of 13 lawmakers will decide which topics get heard in next year’s session and which ones won’t.
Just because a topic is approved by the council, however, does not always mean it will result in legislation, particularly due to the tight time frames seen in budget years. Budget sessions, which take place in even-numbered years, are much more tightly restricted than general sessions. With just over half as many days for lawmakers to work, fewer bills are introduced, and legislation from individuals – which constitutes the brunt of the workload for the Legislature during the general session – can only be introduced by a two-thirds vote.
What will Wyoming do about its revenue issues?
Wyoming is coming off a rough year for revenue at a time where the conversation has been growing urgent.
Returns from oil and gas – while much improved from several years ago – are lower than they once were, even though they still finance a significant share of the state’s operations. The state’s education and infrastructure budgets face structural deficits, while revenue estimates from the state’s Consensus Revenue Estimating Group continue to fluctuate from quarter to quarter – a volatility driven by the state’s dependence on its energy sector. Meanwhile, the state’s reliance on federal funding has also increased over the past two decades, at a time when the Trump Administration has been weighing significant cuts.
After numerous bills to diversify the state’s revenue streams went nowhere this session – prompting hints of future cuts from Senate Appropriations Committee Chairman Eli Bebout, R-Riverton – the Wyoming Legislature looks poised to revisit the revenue question to evaluate what went wrong and where it can go from here.
According to a letter sent to Management Council leadership, the Joint Committee on Revenue will spend several hours during the interim examining numerous failed proposals from this session – including a corporate income tax, sales tax revisions and a lodging tax. The committee could also broach into conversations about other, broader revenue proposals, like an income tax (suggested as a topic by House Minority Leader Cathy Connolly, D-Laramie, if only to see the potential impacts) and an optional municipal tax.
The committee will also discuss the “modernization and reform of the state sales tax system” in a way that expands the tax base and cuts the tax rate to allow the state to remain revenue neutral – a vision often outlined by Speaker of the House Steve Harshman, R-Casper, throughout the 2019 general session.
This conversation could include the prospect of new taxes on wind and solar energy and a deep dive into how municipalities attempt to raise funds for themselves via mill levies, as well as the potential of raising the valuation factor in the state’s tax formula to help address those issues.
“Raising the valuation factor would provide a larger base to work from but would require a corresponding reduction in mills for state and local purposes during the transition to be revenue neutral,” the letter reads. “After the transition, much of the burden and decision-making responsibility for taxes would be closer to the people.”
Other revenue related discussions could take place in the Joint Committee on Travel, Recreation, Wildlife and Cultural Resources, which included proposals for a “comprehensive examination of lawful wagering and gaming in the state” and a state-wide gaming commission in its letter, hinting at the potential for legislation in the coming session.
Meanwhile, the Joint Committee on Transportation, Highways and Military Affairs will be looking at the potential of indexing the state’s fuel tax to a price index as well as the possible tolling of Interstate 80.
After Wyoming’s top educator expressed disappointment in the Legislature’s failure to pass a standardized school safety bill this year, the Joint Education Committee will consider revisiting the topic again in this year’s interim with a study of K-12 and post-secondary school safety and security measures.
The bill, which would have required each school district to develop and review comprehensive safety and security plans, never took off in the House after passing through the Senate, with opponents calling the bill an unnecessary mandate of measures many districts had already been taking on.
The bill also would have established a school safety and security advisory committee.
“The Committee will study these items to identify additional measures to improve safety among all schools,” the committee’s letter, signed by Sen. Hank Coe, R-Cody, and Rep. David Northrup, R-Powell, reads.
Funding for the state’s education system is intrinsically tied to the state’s ability to raise revenues. Only a few years removed from substantial cuts to the state education budget, the Legislature contemplated additional ways to help stabilize funding streams for the state’s K-12 education system independent of the economy’s boom and busts throughout the 2019 general session.
How to go about doing this, however, became a point of contention throughout the general session between the House – which wanted to piecemeal education funding from a multitude of different sources in an effort to diversify and stabilize its revenues – and the Senate, which wanted to appropriate funds for schools out of the general fund as a transparency-boosting method.
According to the letter it submitted to the Management Council, the Legislature’s Joint Committee on Revenue will continue discussions begun in 2018 with an analysis of Wyoming’s revenue streams as compared to other states, studying the state’s existing fiscal structure and its relationship to economic diversification.
Elsewhere, the Special Committee on Capital Financing and Investments will review the current spending policies in place for public funds, particularly as they relate to new, anticipated demands on the Hathaway Student Scholarship Endowment fund and the Excellence in Higher Education Endowment fund created by the passage of new legislation this year.
Improving Healthcare in Wyoming
While the possibility of Medicaid expansion in Wyoming was discussed in the 2019 session, the program was not on the list of topics proposed by the Joint Committee on Labor, Health and Social Services this week.
However, the committee could be looking at partial expansion in a number of different areas to help cover shortcomings in the state’s elder care systems and in how it delivers treatment for mental health and substance abuse issues.
Among the proposals listed by the committee, topics considered this interim could include changes to Medicaid to cover more options for long-term care and a number of waiver-based solutions for funding gaps currently in the system, as well as introducing Medicaid behavioral health waivers for adults and finding increased funding for community mental health providers.
Actions at the federal level could also play a role in the topics discussed this year. According to the letter submitted to the Management Council, the committee will be prepared to “take any necessary actions” relating to ongoing litigation surrounding the constitutionality of the Affordable Care Act, known as “Obamacare.” The committee will also monitor several issues relating to federal regulations of multiple employer welfare arrangements and short-term health insurance plans – which have long been championed by Sen. John Barrasso in Washington – and what effects those could have on Wyoming’s health insurance market.
The committee’s top priority this interim will be looking at measures to help address Wyoming’s aging population, which recent data from the AARP suggests is aging at a rate faster than any other state in the nation. Among other areas, the Legislature could take up a study of potential, new regulations on long-term care facilities to ensure their long-term viability and other issues, like long-term care workforce issues.
The committee will also be taking a state-level review of the retirement savings deficits seen across the nation, which have been growing increasingly worse since the 2008 economic crash. According to a 2017 report from the National Institute on Retirement Security, the average American family has virtually no retirement savings, while two-thirds (66 percent) of working families fall short of conservative retirement savings targets due to long-term trends of languishing income and wealth inequality.
The Management Council meets on Friday morning in room L-54 of the Jonah Business Center in Cheyenne.