Education in Wyoming is on track for a deficit of $500 million.
“I have no idea what to do about the problem,” Rep. John Freeman told Rock Springs Rotary Club members Tuesday afternoon at Western Wyoming Community College.
“I don’t know what is going to happen,” he said. “Politics happen. And the four-letter word that would replace ‘politics’ is pretty relevant.”
The State Legislature needs to have a balanced budget but “still” doesn’t have one, Rep. JoAnn Dayton told the Rocket-Miner.
Education funding and budget balancing
Freeman mentioned twice in his presentation that an education is a “constitutional right.” The Legislature should balance the budget and not further cut education as “increasing taxes is not popular,” said Dayton, who acted as Freeman’s self-imposed fact-checker before the Rotary.
“Every time the Legislature has tried to be cheap on this, school districts have gone to court five times, and (the court) has ruled in favor of students five times,” Freeman said. “I’m concerned this Legislature is trying to get cheap again. The bottom line is that we cannot pass a budget unless it’s balanced.”
Last session, Wyoming legislators cut $34 million from statewide K-12 funding.
Freeman learned at a school facilities meeting last week that the facilities personnel “have gone from constructing new schools to preserving assets to making sure these schools last another 20 years.”
“And that was basically before major maintenance,” Freeman said.
Freeman said the Legislature can take about $150 million in investments.
“But when we’re $500 million short on operations for schools and don’t have any money for major maintenance, $150 million isn’t going to do anything,” he said.
Wyoming has $20 billion in investments, making it “the richest poorest state in the country,” Freeman said
“Constitutionally, we can’t take it out … our investment income is like our third- or fourth-largest income base.”
Freeman said he was discussing different ideas as to how to balance the budget with eight legislators at lunch last week.
“What it comes down to is balancing the budget by raising revenue, which is raising taxes, but we in the Legislature don’t like to use that word, taxes,” Freeman said.
Freeman added that a Wyoming Education Association poll indicated that 78 percent of Wyoming residents would accept a tax increase if it goes to education.
“That kind of poll has some credibility,” he said.
Other financial concerns
“Coal companies are not going to bend over backwards” for bonuses offered by the state, “whatever they are,” Freeman said.
In addition, repairs to the state prison in Rawlins may cost up to $360 million.
“We have nothing for that,” Freeman said. “There is no line-item veto within the budget.”
Given Congress’ recent repeal-and-replace efforts, it has made for volatility on the insurance markets, Freeman said.
“They don’t know what they insurance is going to be in the state of Wyoming,” Freeman said. “But we do know that it is the higher cost per-person in the whole nation.”
The ‘new normal’
“There’s lots of people who are saying that we’ve hit the new normal” in terms of the state budget, having “hit the bottom and starting to climb back,” Freeman said.
“I hope that’s true, but I kind of wouldn’t bet on it,” added Freeman, who said he was recently in Casper for meetings with Wyoming Speaker of the House Steve Harshman and learned that the state “was going to need $100 million just for the general budget.”
Freeman noted many folks say that federal coal regulation will decrease with the Donald Trump presidential administration.
“I seriously doubt that,” he said. “Natural gas prices keep on going down.”
Because of the amount of renewable energy resources in California, Rocky Mountain Power is being paid “to take energy off their hands and sell it to people in their grid system,” Freeman said.
“I’m still skeptical even hearing it from the horse’s mouth, but that’s been backed up in other meetings I’ve attended,” Freeman said.
After President George W. Bush left office, “there were exactly half the number of miners than when he got there,” Freeman added. “So the belief that it was all caused by Barack Obama’s energy plan, that’s highly suspect.”
• Wyoming has a $1.4 billion rainy-day fund and Rotarians asked “is it rainy?”
“I would say most people in government would say that it is rainy,” Freeman said.
• The Legislature must make a budget on projections, Freeman said.
“We put a budget together fairly quickly, because nearly everything we do is in flux.”
• The state gets a 91 percent reduction in its property taxes, Freeman said, stressing that Wyoming taxpayers pay less than any state except Alaska and does not have an income tax or debt.
“We would make J.C. Penney real proud because he didn’t give any credit, either,” Freeman said.
• The state isn’t interested in bonding, Freeman said. With the prison, lawmakers have said “let’s just build a new one and build it in the payment into our budget,” Freeman said. “That has about as much chance as a snowball in hell, in my opinion.”
• Debates among legislators have included whether to carry out the spending down of savings over four or 10 years, Freeman said.