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Prominent lawmakers boost revenue committee before tax votes

Update: Dec. 4, Cheyenne — The morale boost in Casper didn’t appear to light too great a fire for members of the Joint Revenue Committee. On Monday, they punted the biggest tax questions — bills to raise property taxes and to increase and expand the sales tax — until January, when they hoped to have more results from the Select Committee on School Finance Recalibration and a fresher picture of the state’s revenue forecasts. They also tabled a leisure tax to fund tourism promotion.

The committee narrowly voted 8-6 to sponsor a cigarette tax of $1 a pack.  They voted to sponsor a markup to liquor prices, which in Wyoming are controlled by the state. They also passed bills to divert revenue from mineral royalties for school capital construction, and divert some severance taxes that feed the Permanent Mineral Trust Fund and use them to fund state government.

They voted down a bill to raise the beer tax, which has not been raised since the early 1900s. They also voted not to consider a separate tax on liquor and wine that was going to raise funds for substance abuse programs — calling it duplicative to the earlier liquor price markup. Substance abuse treatment programs have seen significant budget cuts in recent years. 

The room was packed with lobbyists for various industries, towns and counties and other interests with a stake in government revenues. Bills to increase property taxes and expand the sales tax to services like corporate accounting and legal fees, which were not voted on, saw heavy opposition from industry lobbyists.

Veteran lawmakers meeting in Casper offered moral support and some political cover to members of the Joint Revenue Committee before a vote scheduled Monday on a slew of tax-increase bills.

Joint Revenue Committee co-chairmen Sen. Ray Peterson and Rep. Mike Madden on Friday presented to the Select Committee on School Finance Recalibration the list of fundraising ideas their committee has developed since the end of the last session. The tally comes to more than $477 million in potential new revenue.

The revenue committee will vote Monday on which tax increases and savings diversions to sponsor for consideration by the full Legislature.

Several lawmakers from the recalibration committee commended the revenue committee for its work and offered sober analysis on the political difficulties of solving Wyoming’s structural tax imbalance. The school finance committee is made up of longtime legislators, many of whom hold leadership positions in the House and Senate.

They also offered revenue committee lawmakers some political cover in advance of next week’s difficult votes.

Madden began the presentation by stating Joint Revenue Committee members aren’t “lusting” after new taxes, as critics have claimed. “What we do is what revenue committees are supposed to do,” he said, “and that is to provide ideas that merit consideration by the entire Legislature.”

Revenue committee members have noted throughout the interim period that just because they vote on tax bills in committee doesn’t mean they’ll support them before the full Legislature.

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On Friday, Speaker of the House Steve Harshman also made that point. “I want to say this again, publicly,” he said. “It’s really important that the public understands the role of what the revenue committee is.”  

Legislative leadership had required the revenue committee to “turn over every stone,” said Sen. Hank Coe, who is chairman of both the Senate Education Committee and the Select Committee on School Finance Recalibration. He congratulated them on the work they had done. “You’re doing nasty stuff that’s not fun,” he said.

Intense public pressure and scrutiny

Friday’s discussion came a day after Gov. Matt Mead, in a presentation of his budget proposal, stated that he did not believe any of the major tax reforms — like sales and property tax increases — would pass, according to a report in the Casper Star-Tribune. It also follows a revenue committee meeting last month in which leaders of the state’s Republican Party apparatus delivered a resolution calling on the committee to drop the tax talk.

Revenue committee members have faced significant public pressure from multiple interests including those who are adamantly opposed to tax increases and those who oppose further cuts to public education.

Madden, for example, once found an anonymous half-page ad in his local newspaper, the Buffalo Bulletin. Citing a right-wing political blog called the Wyoming Prosperity Project, the ad labeled Madden “2017 Cowboy State’s Most Prolific Tax Hiker.” It also said the longtime lawmaker had called his constituents “freeloaders.” In an editorial in the same issue, newspaper staff said the statement had been taken out of context, and criticized the anonymous nature of the attack.

An anonymous ad taken out against Rep. Mike Madden in his local newspaper, The Buffalo Bulletin, toward the end of the last legislative session. (Andrew Graham/WyoFile)

On Friday, Coe noted that opponents of education cuts, the ostensible alternative to tax hikes, can also play rough. The senator said his colleague Peterson had lost customers from his office supply business because some people consider him an enemy of public education. “I resent that seriously,” Coe said.

Peterson has lost around $70,000 in business from two school districts, after the business managers cancelled contracts with his company, he told WyoFile after the meeting. He declined to name the school districts.

Serving as chairman of the Joint Revenue Committee and a member of the School Finance Recalibration has put him in both side’s crosshairs, he said. Many education advocates consider the Recalibration Committee an attempt to find new cuts.

Several members of the Select Committee on School Finance Recalibration said they, too, had received a lot of emails on tax issues. Many of them were “canned deals,” Coe told WyoFile, referring to form emails that are sent by numerous people but initiated by the same source. He did not know who had written the original language, he said.

However, anti-tax sentiment is widespread in the state. Many Republican party officials and conservatives are not willing to consider taxes regardless of structural revenue problems the state may have. They consider cutting government spending a better alternative for righting the state’s fiscal ship.

On Friday, Peterson said constituents need to be further educated on the disparity between how much revenue comes from the mineral industry and how much comes from the rest of the state. The state is already spending into its savings accounts, he said, and needs to find more long-term solutions.

“My fear … is that we don’t do anything,” Peterson said. “I for one am tired of boom bust. I’m tired of trying to estimate a two-year projected budget on estimates on a market-driven commodity. We can do better in Wyoming.”

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Andrew Graham is reporting for WyoFile from Laramie. He covers state government, energy and the economy. Reach him at 443-848-8756 or at [email protected], follow him @AndrewGraham88

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