CHEYENNE – It could become easier for Wyoming cities to generate their own revenue streams if legislation advanced by the House Revenue Committee becomes law.
If passed, House Bill 47 would change the process by which cities and towns can propose local sales and use taxes, giving them more independence to bring their own measures to voters.
Currently, such proposals can only be brought forth by counties, resort districts and the state. The legislation would extend that authority to cities and towns.
During a committee meeting Wednesday morning, several mayors, including Cheyenne Mayor Marian Orr, testified in favor of the legislation and the flexibility it would bring to their cities.
Orr acknowledged taxation is always a tough issue, but added the fifth-penny sales tax is critical for the Cheyenne community. She said the city anticipates gaining roughly $16 million in funds this year from the tax, which pays for everything from road repairs to police cars.
“My argument ... is that the more options you give the communities at large, such as mine, the better it is for the entire state,” Orr said. “If Cheyenne can utilize all of the tools with those seven pennies and be very flexible, we’re going to be really strong, and if Cheyenne is strong, then Mills is strong, Evansville is strong.”
In recent years, Laramie County voters have shown a willingness to support fifth- and sixth-penny sales tax proposals. In 2017, several sixth-penny projects gained approval from voters, and the next year, a measure to renew the fifth-penny sales tax in Laramie County passed with 64% voting in favor of continuing the tax.
In a conversation with the Wyoming Tribune Eagle after the meeting, Orr said the funds from the current sixth-penny sales tax won’t be fully collected until August 2021, meaning the earliest that Cheyenne voters could expect another sixth-penny tax proposal on the ballot would be in November 2021.
The bill would also allow county voters to decide whether they want to make a fifth-penny sales tax permanent. Before such a measure would go to the voters, however, at least half of the municipalities in the county would have to agree to put it on the ballot.
The 50% threshold, previously set at two-thirds of the municipalities in a county, was a slight point of contention during the meeting. Laramie County includes five municipalities, so the bill would lower the number of municipalities that would need to sign off from four to three.
Brett Moline, a lobbyist for the Wyoming Farm Bureau Federation, questioned the lower threshold in his testimony.
“In your body, if it’s a 50% vote, that vote would die,” Moline said to lawmakers. “It just seems to be a little bit ironic for me.”
Moline said his members would prefer keeping the tax measure countywide, because many farmers who shop in nearby cities would have to pay a tax that they had no say in.
With the support of both the Wyoming County Commissioners Association and the Wyoming Association of Municipalities, the bill was viewed as a compromise that took a while to carve out. Cody Mayor Matt Hall told lawmakers that finding a compromise has been a yearlong process.
Hall noted with the projected revenue shortfalls facing the state in coming years, the measure would provide another way for cities to try to address those challenges on the local level.
Ultimately, lawmakers on the committee approved the measure despite some reservations. Rep. Pat Sweeney, R-Casper, said he would support the bill because it would add another tool to the toolbox for the state’s municipalities.
“Do I like this thing? Not particularly,” Sweeney said. “I think it’s too quirky, but I’m going to keep my mouth shut, because I believe it was a grand compromise.”
Rep. Tim Hallinan, R-Gillette, also said he would support the bill despite some reservations. The representative wasn’t warm to the idea of the potential for more tax proposals, but said the issue would be left to voters to decide.
Following the committee vote, the bill will now go back to the House for up to three votes before it could cross over to the Senate.