CHEYENNE – Even with major budget cuts earlier this year, Wyoming is still looking at a large deficit for the 2017-18 biennium, according to a report released Monday by the state’s Consensus Revenue Estimating Group.
Current projections show the state will have a $156 million deficit for the 2017-18 budget, which began July 1.
That figure includes a required contribution to the state’s budget reserve account. If that is taken out of the equation, Wyoming will still have a $52 million shortfall.
The ongoing budget deficits are due to less revenue derived from minerals and fossil fuels.
In fact, the CREG report is projecting severance tax collections will remain below levels seen in fiscal year 2015 at least through the early 2020s.
Gov. Matt Mead said Monday morning he does not plan on calling for additional budget cuts before the Legislature convenes in January.
Mead also said he and his staff may propose dipping into the state’s rainy-day fund, which currently contains about $1.6 billion.
“In my mind, it is raining in Wyoming, and this is a time to smooth out this downturn to use some additional rainy-day funds,” he said.
Earlier this year, Mead directed state agencies to make cuts that totaled more than $248 million.
The full effect of those cuts, he said Monday, has yet to be felt.
Further budget cuts would likely result in employee layoffs and service reductions, Mead said.
“None of us know when mineral prices are going to fully come back,” he said.
“We have to be conservative in use of the rainy-day fund, but we are not going to cut our way back into prosperity.”
Mead said the state needs to make sure it doesn’t spend the rainy-day account too quickly.
At the same time Mead was meeting with reporters in Cheyenne, other state officials were presenting the CREG report to the Legislature’s Joint Appropriations Committee in Casper.
Rep. Steve Harshman, R-Casper, a co-chairman of the committee, said lawmakers are likely to look to make up the difference through reductions or savings, and not through taxes, the Casper Star-Tribune reported.
Still, Mead said the situation is “not a disaster,” and Wyoming has ways to get through the shortfall.
Since the 2017 session of the Legislature is a general session, Mead is expected to release a supplemental budget proposal in December.