Sales tax increase removed from school funding bill

Kathryn Palmer, Wyoming Tribune Eagle via Wyoming News Exchange
Posted 3/30/21

A proposal to address a $300 million shortfall to Wyoming’s K-12 education funding model is headed to the Senate floor, but a sales tax hike won’t be a part of the possible solution.

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Sales tax increase removed from school funding bill

Posted

CHEYENNE — A proposal to address a $300 million shortfall to Wyoming’s K-12 education funding model is headed to the Senate floor, but a sales tax hike won’t be a part of the possible solution.

“Frankly, I don’t think we can get 16 votes on the floor of the Senate with a bill that has a tax increase in it," Senate Education Committee Chairman Charles Scott, R-Casper, said Monday.

The committee voted 4-1 to advance House Bill 173, which proposes to cut more than $50 million from K-12 education. In this version, most of those cuts would target reductions to inactive health insurance plans for school district employees, which is projected to save about $80 million over the next three years.

But before the committee passed the bill, it killed a provision that would have authorized a half-cent sales tax increase if the state’s primary savings account dips below $650 million.

Wyoming has historically boasted one of the highest per-pupil expenditure rates in the nation, in part because the Legislature is beholden to a court-enforced constitutional mandate to adequately and equitably fund education for all children, regardless of where they live in the state. However, it has largely relied on federal mineral royalties on coal, oil and gas production, and those revenue streams have experienced dramatic decline over the past several years.

Previous versions of the bill passed Monday proposed to address these looming gaps by raising a one-cent sales tax and earmarking it for education, which was a plan many education advocates, including the members of the Wyoming School Boards Association, lauded as a step in the right direction for solving Wyoming’s education budget crisis. But a vocal faction of lawmakers have expressed their disapproval of raising taxes on their constituents, which falls in line with Wyoming’s relatively low tax state and local tax rates.

On Monday, Scott made it clear that, from his point of view, the sales tax increase wouldn’t have much of a chance of passing through the upper chamber during the final days of this year’s legislative session.

Scott said that once the bill moves to the Senate floor, where it will need to pass three readings to become law, he might propose a tax increase that would start after the next general session “to find out (if I’m) right about how people upstairs feel.”

Scott voted alongside three out of his four colleagues to remove the tax increase language from House Bill 173; Sen. Chris Rothfuss, D-Laramie, was the only one to vote against the amendment.

Sen. Affie Ellis, R-Cheyenne, explained that her support of the amendment stems from concerns over “the flipping light switch nature of a tax coming on and off. … The revenue-raising piece, I think, is a conversation for another day.”

In addition to voting to remove the tax increase, Ellis also expressed support for another aspect of the bill, which would increase both class sizes and teacher salary schedules. The bill also proposes to put teacher salaries into a “categorical grant,” which would be separate from the rest of the block grant model.

“I really like the notion of protecting teachers' salaries,” Ellis said. “In some of the emails I’ve received from the public, I feel like there’s a little bit of confusion or concern that this is an attempt to target teacher salaries first. I just want to make sure I understand that this as an attempt to protect teacher salaries from being reduced.”

Scott affirmed that, adding, “That’s what we’re trying to do.”