CHEYENNE – Lawmakers have spent weeks debating a pair of sweeping education funding bills designed to address a looming budget shortfall that could hit $1.8 billion by early next decade.

But while each bill has passed through one chamber of the Legislature, a critical negotiation remains. The Senate bill attempts to solve what Gov. Matt Mead calls a crisis exclusively through cuts. The House bill, meanwhile, uses a broader approach the employs cuts, dipping into savings and a possible sales tax increase.

The bills have been amended, substituted and debated. An additional budget amendment that requires $91 million in education cuts has sparked discussions, both in the Legislature and in the hallways of the Jonah Business Center. These legislative actions will determine the immediate future of education money in a state that’s generously funded schools for more than a decade.

“This is a very rich model,” said Sen. Hank Coe, R-Cody. He’s also the co-sponsor of the Senate’s education bill. “It’s richer than any other models in the region.”

But the model has reached a crossroads. Because of a downturn in the energy economy, which funds about 65 percent of education here, schools face a $400 million annual shortfall in the coming years.

The two primary bills that lawmakers hope will address the crisis have both been passed and sent to the other chamber. Both will have to be considered by one of the two education committees this week to survive, and the $91 million amendment will be the subject of negotiations as the Legislature’s budget bill is hammered out.

What lawmakers will decide and what parts of the bills will continue on remain uncertain.

“I’m just waiting to see what happens in the next two weeks,” said Kathy Vetter, the president of the Wyoming Education Association.

House Bill 236

Described by officials as a balanced approach to addressing the crisis, HB 236 is a sweeping omnibus bill based off of what’s called the white paper, a list of suggestions released in early January by an education subcommittee.

The bill has been amended and rewritten, and its most controversial provision, a temporary 2 percent sales tax increase, was scaled back and then removed entirely. A 0.5 percent conditional sales tax hike has received similar scrutiny: It was also removed at one point but was eventually re-instated.

House members and education officials, like Vetter, have talked of the importance of the bill’s approach. It dips into savings, institutes reductions during a period of three years, diverts a 1 percent severance tax to fund schools and includes the conditional tax increase.

The latest version of the bill would also:

  • Dip into the Legislature’s rainy-day fund every year as needed to restore the primary education account balance to $100 million.
  • Change the calculation method for average daily membership, a measure of attendance that determines how much money districts receive.
  • Freeze transportation spending at the average amount spent during the 2014-15, 2015-16 and 2016-17 school years. This would be effective starting in the 2018-19 school year.
  • Freeze special education spending at 100 percent of the amount spent during the 2016-17 school year. This provision would become effective beginning in the 2018-19 school year.
  • Impose a 0.5 percent sales tax increase should the Legislature’s rainy-day fund drop below $500 million.
  • Cut money provided for instructional facilitators and move the funding for those positions into the block grant given to schools.
  • Impose a moratorium on alternative schools until June 30, 2019. The Joint Education Committee would study the topic until November 30, 2018.

The bill would also establish a supercommittee of 16 lawmakers that would complete a recalibration of the funding model, a process that involves consultants and lawmakers examining the model and adjusting it as needed.

In the first year, the cuts from the omnibus bill would equal around $32 million and would approach $80 million in the third year, officials have said.

The measure has passed the House and has been referred to the Senate’s Education Committee, which will discuss the bill Tuesday.

The most contentious part of the bill has been the 0.5 percent sales tax increase. Senate President Eli Bebout said last week that he didn’t support the provision, and Harshman acknowledged that he couldn’t predict what would become of the bill once it was in the Senate’s hands.

Vetter said she expected the bill to make it out of the Senate’s committee, albeit with amendments. She wasn’t sure what amendments to expect but said the elimination of the sales tax increase was possible.

Senate File 165

While the omnibus bill includes the use of savings and the possibility of increasing the sales tax, the Senate’s main attempt to solve the crisis involves only reductions.

Also a heavily amended bill, SF 165 is sponsored by Sen. Bill Landen, R-Casper Landen and co-sponsored by fellow Republican Sens. Bruce Burns, Hank Coe, Dan Dockstader, Ogden Driskill, Stephan Pappas and Senate Majority Leader Drew Perkins.

Like the omnibus, the Senate’s bill would change the attendance requirements for students to be considered full time. It would also provide funding in 2018-19 for only those teachers who are actually employed by a district in the current school year.

The bill also includes:

  • A 2.5 percent and 5 percent cut to districts’ block grants in school years 2018-19 and 2019-20, respectively. However, those cuts would only roll into effect if the funding model were not recalibrated or a new funding model were not created.
  • A freeze of transportation spending at 2011-12 levels, beginning in school year 2018-19. As of March 15, districts cannot purchase or lease new school buses.
  • A freeze of education spending at 2015-16 levels.
  • A reduction in funding for instructional facilitators, who act as teachers’ teachers, to 45 percent in the 2017-18 school year to 30 percent from that point on.

The bill states that “the reductions implemented by this act are intended to be temporary pending a recalibration of the education resource block grant model.”

How much would be cut by SF 165 is unclear. An attached report by the Legislative Service Office states that staff were unable to determine the fiscal impact of the cuts because of “insufficient time.”

Landen said the figure was between $60 million and $80 million, and Senate Majority Leader Drew Perkins indicated the bill may ultimately reduce education funding by around $79 million.

The budget amendment

In addition to the two main education bills, senators advanced a budget amendment two weeks ago that would require $91 million in education cuts next year. The amendment has prompted anxiety in education officials and sparked a debate among lawmakers.

Sen. Chris Rothfuss warned that the provision was unconstitutional. Sen. John Hastert added that while the education funding model may be rich, it’s the model legislator’s chose and it was their duty to continue supporting it.

But Sen. Charles Scott, the sponsor of the amendment, said it was the Legislature’s duty to balance the budget and told legislators that Wyoming was over-funding education.

“We’ve developed major excesses in our education system, and they’re getting in the way of getting the kind of results that we deserve,” he said.

Enter Scott’s amendment. A provision of the Senate budget bill that was passed two weeks ago, it would institute $91 million in cuts next year.

But there’s some evidence that the provision is a bargaining chip to be used in negotiations with the House. Majority Leader Perkins told the Star-Tribune last week that it was a “vehicle for negotiations.” Boyd Brown, the superintendent of Campbell County School District No. 1, speculated that it may be an attempt by the Senate to kill the sales tax increase provision in the omnibus bill.

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