Officials discuss property tax potentials

Before leaving for the start of the 68th Wyoming Legislature this week, local legislators stopped by to talk to the Sweetwater County Board of County Commissioners and see what main areas of concern, like property taxes, may need to be addressed.

During the public comment portion of the January 7 meeting, Senator John Kolb and Senator Stacy Jones spoke with the commissioners about topics that may come up during this year's legislative session, with an emphasis on bills that may be put forward regarding property taxes.

"Last year was heavy on property tax, and I assume we're going to hear more of that this year," Commission Chairman Keaton West noted.

Senator Kolb agreed that the subject of property taxes will be "high up on the list," and said his question is what can be done to consolidate existing programs.

"My preference would be to balance these property tax cuts with budget cuts in order to make them certainly cost neutral for the counties and for the districts," Kolb added.

Senator Jones noted that the "People's Initiative to Limit Property Tax in Wyoming through a Homeowner's Property Exemption" is coming to the legislature again. The initiative proposes a 50% cut to property taxes, and was first proposed last year but wasn't approved. Senator Jones and Kolb both commented on a potential proposal to cut 25% that is also being discussed.

"Twenty-five percent is horrific, but fifty percent is much worse," Senator Jones said. "I do think the public does not understand what the implications are of that."

She said she believes that those who collected ballot signatures in favor of the initiative were not truthful with the public, and that most people don't understand that the bill has no backfill from the state.

The issue of whether or not bills are backfilled with funding from the state to make up for cuts is a major question to be considered, according to Kolb. There are also concerns for services to be funded, both now and in the future. Kolb pointed out that there is a projection that the state of Wyoming will run out of money for funding education by 2030.

"I wouldn't be in favor of a perpetual tax cut on properties unless we knew we could afford to do it, and we don't know that yet," Kolb said.

Chairman West pointed out that one of the factors people may not consider is that the majority of property taxes collected go toward funding education. He also asked Senator Jones whether the state is obligated to fund education, which she explained is true and in the constitution.

"We would have to do some sort of backfill for the schools, although I'm guessing if that were to happen, that also would be tightening their belt as well," Senator Jones said.

Jones added that meetings were hosted with school districts and Western Wyoming Community College to make them aware of some of the changes that could be coming so they could start to prepare.

"I'm conservative but I also know we have to be answerable for the actions that we take, and to come back here and to tell the residents of Sweetwater County that we've cut a lot of their services is not what I'm planning on doing," Senator Jones said.

Commissioner Island Richards pointed out that special districts and funding from property taxes help provide services to residents, and when local special districts, such as fire districts, are already struggling with funding, property tax cuts could make things even worse.

"If the legislature and if a ballot initiative wants to eliminate that funding source, then they can't do it in a vacuum, they have to provide a new solution to provide those services," Richards said. "If we don't have fire protection, we're all in trouble. If we don't have districts that can provide us quality water and sewer services, we're in trouble. If we can't take care of our roads, we're in trouble. We're not a community anymore."

Commissioner Taylor Jones also expressed his concerns, commenting that cutting funding by passing property tax cuts without backfill and telling government to tighten their belts is difficult when governments are already making drastic budget cuts.

"To just say we're going to cut property taxes and that's going to make everything hunky dory is absolutely not true," Commissioner Jones said.

Another concern expressed by Commissioner Mary Thoman was that cutting property taxes now could lead to Wyoming instating an income tax to make up for the lost funds, which she said is "the reality which I hope we do not have to revert to."

Another question that was brought up was regarding the impact of the long-term property tax exemption, which was one of the property tax changes that did pass the legislature last year. Commissioner Robb Slaughter pointed out that there was a misconception last year that this program was backfilled, and he added that the effect of that program is significant in Sweetwater County. Assessor Dave Divis explained that there have been roughly 1,600 applications to the program in Sweetwater County, which could be about $1.1 million or $1.2 million that won't be paid in property taxes. Most of that money usually goes to the general county fund, so it will have an effect. Divis also pointed out that most special districts don't have industrial properties or minerals within their district, so the majority of their funding comes from taxes on residential properties.

Slaughter also noted that he is concerned about the future of the mineral industry, particularly with recent reports of the price of trona decreasing. Because much of Sweetwater County's tax revenue comes from mineral valuation, the county could also see a loss of funding from that front. Divis added that other counties have even less, or no, mineral valuations to receive funding from, so while Sweetwater County may ultimately survive tax cuts, other counties may not.