CHEYENNE – As Gov. Mark Gordon delivered his State of the State address Monday morning to kick off the legislative budget session, one thing was clear: Our state lawmakers have to work together to find creative solutions for a projected budget deficit in the state.
Wyoming has long relied on tax revenue from coal and mineral businesses, which has kept taxes low for residents but led to a projected shortfall of more than $200 million. Much of Gordon’s address was centered around the mineral industry, and local legislators share his concerns.
Looking forward to the coming month, Sen. Tara Nethercott said Gordon’s address showed a “commitment from (the) governor to work with the Legislature in navigating this time of declining revenue, which signals a successful budget session.”
Regardless of the economic situation at hand, Gordon said the state was smart with saving when times were good, leaving Wyoming with a flush savings account and time to plan for the future.
“Despite some obvious challenges this year, our economy remains strong,” Gordon said. “We’re strong thanks to our people, we’re strong because we have planned well for challenging times, and we’re strong because of our industries – energy, tourism, agriculture and the emerging sectors of knowledge-based business and manufacturing.”
While the state’s economic landscape is positive right now, Gordon said the budget he presented to the legislator’s was “intended to trigger a serious conversation about our future, ways to diversify our economy and ways to strengthen our state.”
Over the next month, the state’s elected officials will pass a budget for the 2021-22 biennium, which local officials hope will set the state on a more positive revenue track into the future.
“All of us all the time are working together to come up with solutions that work for the betterment of the state,” House Minority Leader Cathy Connolly, D-Laramie, said.
And while Connolly called the governor’s budget “lean” and “balanced,” she pointed out the need to diversify the state’s revenue streams in addition to diversifying the economy. For Connolly, that includes having conversations about additional taxes in the wake of revenue losses from the coal industry.
“We are losing hundreds of millions of dollars,” Connolly said. “We’ve saved, and we’ve dipped into that savings, but that coal is not coming back and we all know that.”
Gov. Gordon spoke with more faith in the industry, saying Wyoming’s energy is “still discriminated against, maligned and decried as dead.” Drawing applause from the crowd, Gordon followed by saying, “Well, not on my watch!”
After the address, Rep. Sara Burlingame, D-Cheyenne, said the governor’s claim of discrimination was “ahistorical and inaccurate.” And while Burlingame took issue with some of the governor’s statements on coal, she said the address was a good sign as they enter into a “tough” budget session.
“We might disagree on some fundamental things, but there’s a lot of goodwill there,” Burlingame said.
During the address, Gordon discussed temporarily reducing severance taxes and changing the schedule for ad valorem taxes paid by energy companies to help the energy industry in the state succeed and to make sure Wyoming gets its share of the profit. The new ad valorem change is an attempt to reduce the amount of unpaid taxes by energy companies, which is now in the millions.
“The issue that we’re facing across the entire state is budget related,” Rep. Jared Olsen, R-Cheyenne, said. “It’s long-term economics.”
In looking at longevity, Rep. Dan Zwonitzer, R-Cheyenne, said focusing on research and development in the coal and mineral industry is necessary if it is going to adjust to the current landscape.
He said doing so can “help make coal viable into the future.”