Programs to help Wyoming’s elderly, poor, incarcerated, addicted and mentally ill will all see budget reductions, Gov. Mark Gordon told lawmakers on Monday morning as he prepared the state for 10% cuts to most government agencies.
Gordon outlined deep reductions that will reach into every aspect of government at the state, county and municipal level.
“What’s that going to mean for our hospitals, for our communities, for our town’s abilities to see the needs they have going forward?” he asked during his presentation to the Legislature’s Joint Appropriations Committee. “We are going to have to abandon some of our towns because we will not be able to afford upkeep on our roads and sewers.”
Most state agencies are taking 10% cuts, according to a press release from the governor’s office. The wholesale trimming is in response to a massive decline in projected revenues. Gordon named the Department of Health, the Department of Corrections and the Wyoming Attorney General’s office as slight exceptions. They will see 9% cuts. The cut to the health department, however, is still $90 million. Public education, which has separate revenue streams, has also been left out for now.
The governor is cutting more than $250 million in this first round. An as-yet-unknown number of state employees will be laid off and more may see furloughs, Gordon said. It also may only be the beginning — Gordon has asked agency heads to identify another 10% slash, though he said he would proceed more cautiously on a second round of cuts and could wait for the Legislature to convene again.
“We need to understand what those [reductions] will do to our state,” Gordon told WyoFile on Monday. “There are choices to be made and I’m hoping the Legislature and the legislators that get elected understand those choices.”
Even a 20% cut won’t dig the state out of its budget deficit, however. The state’s projected general government deficit for the coming two years is almost $1 billion, while public education faces a $500 million deficit.
Gordon is no longer optimistic about a travel recovery that would bring Wyoming revenue through its tourism industry while also raising fuel prices and perhaps the state’s oil and gas industries, he told lawmakers. Such a rebound isn’t materializing as COVID-19 infections continue to explode nationally. Visitors to the state’s public lands are camping, not staying in hotels (where they would pay lodging and sales taxes), Gordon said.
Though COVID-19’s blow to the economy and a plunge in oil prices are the immediate culprits, Wyoming is now paying for decades of state leaders failing to diversify its revenue streams away from now-struggling extractive industries. Gordon highlighted that failure on Monday by pointing to Idaho and Texas, states he said are better off today because they diversified their economies away from the fossil fuel industry.
Wyoming lawmakers have shied away from passing tax reforms even as many in the state’s leadership said such laws were necessary to ward off a fiscal catastrophe.
Today, Gordon said, Wyoming is in “the biggest fiscal crisis in our history.”
Gordon is hopeful that the cuts’ impacts will help drive a conversation about the state’s outdated tax structure, he said.
“The people of Wyoming are going to have to come to understand [that] to address these budget shortfalls, it’s going to be painful,” Gordon said.
Social services in the crosshairs?
Though the reductions are nearly across the board, Gordon has focused on severe cuts to social services in his public comments. At a press conference last week, he pointed to elder care and mental health and substance abuse treatment as state programs that would be on the chopping block.
“Some of these cuts in programs are going to be substantial,” he said on Monday, pointing out a public health program for breast and cervical cancer screenings and “the very good programs that are in our prisons to affect recidivism.”
Recidivism is the rate at which people released from prison return after committing new crimes or failing the conditions of their release. Programs that provide mental health and substance abuse treatment to inmates have proven to lower that rate.
Cuts to public health programs and social services are counterproductive and hurt the state’s most vulnerable, House Minority Floor Leader Cathy Connolly told WyoFile on Monday. If the governor is using such cuts as a political strategy to gain support for tax reform, it’s going to cause “real harm to real people,” she said.
“The governor’s strategy appears to be, ‘I’m going to initiate and institute these cuts so that people in the state really feel the pain and then we can talk about revenue,’” Connolly said. “The most vulnerable are going to be hurt and hurt the most. They’re the ones that don’t have the voice that business and industry does.”
“The person with a mental illness, the person with a substance abuse problem who can’t get into treatment, they’re suffering,” she continued. “They’re not going to get into advocating and lobbying.”
The governor has highlighted cuts to programs that hit the state’s most vulnerable, “to illustrate that the severity of the situation the state is in is not going to allow us to protect some of these programs,” Gordon’s spokesperson Michael Pearlman said.
The spending reductions themselves aren’t aimed at the state’s most vulnerable, the governor said.
“Pick anything,” Gordon told WyoFile. “Pick snow removal… pick school funding, pick travel budgets, pick government employees, pick aid to local communities, pick road construction, the depth of the cuts are going to affect everyone. We’re not picking random things out of the hat and we’re not trying to pick the most devastating things out of the hat. We’re just saying there are choices that are going to have to be made.”
Among the cuts are initiatives Gordon himself has championed, like a program to boost vocational education at Wyoming’s community colleges, he said. Gordon called that program one that “had to go right from the start.”
But Wyoming policy makers have a tendency to cut social programs when budget crunches arrive, Connolly said, only to replace the money later when the societal costs of those cuts outstrip the savings. The state cut mental health and substance abuse treatment programs in Wyoming’s prisons in 2016, for example, only to reinstate it once the recidivism rate spiked, and with it the costs of incarceration. DOC Director Bob Lampert told lawmakers at the time that the cost of housing the repeated offenders amounted to twice the savings of the cut.
The cuts result in costs outside the prison system too, Connolly said. “It means our communities are less safe and these individuals are not productive members of our society,” she said.
Lampert declined to comment on whether Gordon was referring to cutting in-prison treatment programs again, he said. The agency is “still in the deliberative stage and unable to provide details,” he wrote in an email.
Though it may appear Gordon has no options but budget slashing, Connolly said the governor does have choices. He could push for passing new taxes and Medicaid expansion, she said, to fund programs for issues like suicide and substance abuse — both problematic in Wyoming.
“When the governor has leadership the Legislature listens, and the governor right now is refusing to take that leadership,” Connolly said.
Gordon was still wary of Medicaid expansion, he said — both what it might cost the state to implement and how it could impact budgets down the road. He also argued he is pushing the Legislature to confront taxes, but that ultimately it is up to them.
“The Governor can opine on these things and I did,” Gordon said.
Gordon and Connolly do appear to agree that the state’s dire fiscal straits will change how Wyoming practices government.
“We’re talking about substantial changes in the way the government does work,” Gordon said. “If we are thoughtless in how we make these cuts, if we just make cuts to make cuts, we will compromise our ability to run businesses in our communities, we will compromise our ability to fund schools at all.”
Connolly sees an opportunity to shape the state now, while the federal government is providing stimulus money to respond to COVID-19, she said. Lawmakers could reconsider ideas they’ve rejected, like Medicaid expansion, or explore new ideas like using the federal stimulus money to waive a year of tuition at the University of Wyoming and the state’s community colleges.
Gordon’s announcement to the Joint Appropriations Committee on Monday of a cut to a women’s cancer-screening program was emblematic of a lack of representation in Wyoming leadership of those most affected by the cuts, Jen Simon, founder of the Wyoming Women’s Community Action Network, told WyoFile. Impacts resulting from the cuts Gordon named at the meeting will fall disproportionately on women, Simon said. Gordon and all 12 members of the Joint Appropriations Committee are white men.
The state’s breast and cervical cancer early detection plan costs the state $750,000, money that is matched by the federal government. The program helps healthcare providers catch such cancers early by supplementing the costs of screenings for low-income women, Simon said.
“It’s a fantastic return on investment,” she said.
Such are the options for a state where government has been making cuts for years and now still faces a fiscal cliff, Gordon said. “There is this view that, like what we’ve done before, there will be cuts there will be some noise and things will carry on roughly as they have,” he said. But, “we’re talking about bone now. It’s past the point of fat.”
Whether advocates like Simon trust that conclusion is another question. While making cuts, the Legislature has also funneled money towards pet projects over recent years, like state building projects and tens of millions of dollars to support the state’s withering coal industry.
People, lawmakers included, tend to focus on their own experiences, Simon said. A state leadership dominated by well-off men is, as such, quicker to cut programs that hit women or the most vulnerable, she said, because it’s harder for them to imagine the harm.
“We need more diverse voices at the table,” Simon said. “That would give me more confidence that, if they came back and said these are the places we need to cut, that there aren’t any more choices.”