CHEYENNE – With the fallout from the coronavirus pandemic and the Russia-Saudi Arabia oil price war, Wyoming's financial situation is dire.
Even with a $250 million budget cut approved Friday by Gov. Mark Gordon, the state is still facing a $600 million budget shortfall. Monday morning, Gordon gave the Wyoming Legislature's Joint Appropriations Committee a grim picture of what the coming months will look like for state government.
"If you fired every single state employee, every single one, ... we would not be able to address the shortfall that we have," Gordon told lawmakers Monday morning. "You can look at eliminating all of the health programs – every single health program that we have – and you'd only marginally affect what's happening."
On top of the $250 million that was cut, which totals nearly 10% of the state's general fund budget, Gordon has requested each department propose an additional 10% in cuts to be carried out later this year.
With such a severe reduction in expenditures, Gordon said, "This is going to affect our government services. People are going to lose their jobs."
As outlined in Gordon's executive order signed last week, every state employee that makes more than $65,000 a year will be furloughed for one day a month for the next six months, which is estimated to save the state about $2.8 million. To help cut costs, all human resources personnel at the state have been consolidated under one department, which will eventually lead to a reduction in HR staff.
Gordon also said the state will focus on targeting programs with severance packages "so that any reduction in the workforce is strategic and leads to the elimination of the position."
But due to the size of the budget shortfall, Gordon said Wyoming residents will still see a reduction in services provided by the state. For the Department of Health alone, the 9% cut from the state equates to $90 million.
"We will have fewer services in things like elder care, mental health and Medicaid. It means that doctors, nurses and other caregivers across Wyoming will see less money, and that will impact our economy and our safety net," Gordon said.
The governor also proposed the idea of revisiting Wyoming's death penalty law, which costs the state about $1 million per case. But in seeking solutions for the budget woes, Gordon said they do not want to raise taxes.
To that, Rep. Lloyd Larsen, R-Lander said, "We can't cut our way out of this."
"Should we not be looking at doing away with some of the tax exemptions that we see around the state? If we have industries and professions that are generating income in the state of Wyoming, should they not be participating in supporting the state of Wyoming?" Larsen asked.
Gordon said the current state tax exemptions, including exemptions for property taxes, groceries and manufacturing, will likely fall victim to this year's budget cuts.
"We have to look very carefully at all of our exemptions and eliminate them, quite frankly," Gordon said. "That's essential, and the monies that are recovered there will go partly toward solving some of these issues."
Gordon said going forward, the Legislature may also have to reevaluate which programs the state is required to carry out, which would require action from state lawmakers. By early fall, Gordon said, the state hopes to have a better view of what a 20% cut will actually look like.
"We all must understand what is lost and what we further stand to lose with all these cuts," the governor said. "They will have real impacts on people's lives."