(This story about school funding was produced by The Hechinger Report, a nonprofit, independent news organization focused on inequality and innovation in education. Sign up for the Hechinger newsletter at https://tinyurl.com/hechingerreportnewsletter.)

CHEYENNE — Annie Good and her co-teacher have made their fifth grade classroom a homey space for their 33 students. The room is in the south wing of the sprawling K-12 education complex in Shoshoni, a town of 649 people.

The $49 million school building, up the road from the abandoned storefronts downtown, can make visitors look twice, said Christopher Konija, Shoshoni’s police chief, who is also town clerk and treasurer.

“It’s like looking at two different worlds,” he said. “To me, the school – what it looks like and what it represents – shows the potential for Shoshoni.”

State spends big on K-12

The state-built, modern building is just one brick-and-mortar example of how Wyoming has poured its mineral wealth into its school system ever since the state Supreme Court heard a series of cases – starting in 1980 – challenging the equity and adequacy of school funding in Wyoming. In 1995, the court found that legislators were, indeed, responsible for budgeting enough money to fund a ”quality” education for all Wyoming children. And though such findings are not uncommon nationally, the result in Wyoming has been to make it the biggest spender per student in the Mountain West and one of the biggest in the United States.

Wyoming’s per-pupil expenditure in 2017 was $18,221, compared with the national average of around $13,000, according to Education Week’s Quality Counts 2020 report, which adjusts the numbers for regional cost differences. The report gave the state an A in spending and an A-minus in equity, for an overall grade of A-minus (achieved by only one other state, New Jersey). Wyoming’s National Assessment of Educational Progress (NAEP) scores, too, are consistently higher than the national average and on par with Northeastern education strongholds like New Jersey.

But as the state’s once-booming coal, oil and gas industries erode, maintaining those funding levels would mean raising taxes in one of the country’s most conservative, tax-averse states.

For years, fossil fuel money has paid for competitive teacher salaries, drawing educators to Wyoming’s constellation of small schools. It’s part of the reason why Good, the fifth grade teacher at Shoshoni, moved to Wyoming six years ago with her husband and two young daughters. She’d been living and teaching in Arizona, which spends less than half of what Wyoming does per student. She wanted better teaching conditions and pay for herself (her monthly salary nearly doubled when she moved) and a better education for her girls.

“A lot of the schools around us hadn’t had art, music or PE for years,” Good said of where she had lived in Holbrook, Arizona.

All this makes the current threat to Wyoming’s school funding model that much more upsetting for Good and other parents and educators around the state. They’ve come to rely on benefits like fully funded special education programs, decent teacher pay, well-funded career and technical education programs, and free transportation to and from school on Wyoming’s long rural bus routes.

In contrast to the school funding disparities plaguing communities in many other states, Wyoming uses a highly equitable formula to ensure that students in places like Teton County, which boasts acres of pricey mountain real estate, have access to the same opportunities as those in Fremont County, home to Shoshoni, which is one of the poorer counties in the state.

Wyo. “doesn’t realize which red it is”

“Wyoming prides itself on being a red state, it just doesn’t realize which red it is,” said Richard Seder, an education policy consultant who has worked for the state. Using Wyoming’s unmatched mineral wealth to offer every student access to the same high-dollar education was “the socialist utopia – to have everything and never have to pay for it.”

According to data from the Wyoming Department of Education, as of the 2019-20 school year, about 53 percent of the revenue in Fremont County School District 24, which consists of only the Shoshoni school, came from local taxes; 43 percent came from the state. The ConocoPhillips Lost Cabin natural gas plant 30 miles away in Lysite pads the district with more local revenue than many others have. (The adjacent Fremont County School District 25 got 78 percent of its revenue from the state in the last school year.) During the years Shoshoni was constructing the new school building, the state paid more than half of the district’s budget, which is a relatively modest $9 million.

Figures like that are not uncommon in the nation’s least-populated state, which typically serves around 94,000 K-12 students total, or roughly the same student population as Denver. Over the past 20 years, Wyoming, which is the nation’s single largest producer of coal, has used approximately $2.5 billion from federal coal-lease bonuses and federal mineral royalties to build more than 70 new schools, like the one in Shoshoni, and improve hundreds more.

“Essentially what Wyoming did was export the cost of its education system to people outside of Wyoming,” Seder said. Tying school funding to mineral wealth meant local taxpayers did not think about the amount spent on education in their state in terms of their own pocketbooks.

“Unfortunately, the predictable bust cycles (in the fossil fuel market) have brought the chickens home to roost,” he said.

“Coal is not coming back”

Since 2008, which was the peak of production in the Powder River Basin in northeast Wyoming and southeast Montana, where more than 40% of the nation’s coal is produced, a drop in market demand has driven a steep decline in Wyoming’s primary revenue stream. When including volatile oil and gas revenues, mineral extraction has accounted for anywhere from 50 percent to almost 70 percent of Wyoming’s general fund over the years.

In 2019, Wyoming produced 277 million short tons of coal, according to the Wyoming State Geological Survey, compared with 466 million short tons in 2008. Reduced energy demands during the COVID-19 pandemic have driven down coal, oil and gas consumption even more. In March 2020, Wyoming had 21 active oil and gas rigs in the state. Now it has five.

In a state where half of the land is managed by the federal government, President Joe Biden’s recently announced moratorium on new oil and gas leases on federal lands – 92 percent of natural gas and 51 percent of oil in Wyoming is produced on federal lands – could make things even tighter for schools, said Jillian Balow, the state schools superintendent. Balow joined education chiefs in North Dakota, Montana, Alaska and Utah last month to ask Biden for an exemption.

“This is a lockdown of an industry that our students in Wyoming really depend on,” Balow recently told Fox News’ Dana Perino in response to the indefinite pause. The Wyoming Department of Education estimated that oil and gas produced in Wyoming contributes $740 million to public education per year and that federal royalties paid to the state on oil and gas contribute $150 million per year to K-12 funding.

Does Wyo. spend too much on schools?

Eli Bebout, the recently retired former president of the Wyoming State Senate and a 1964 graduate of Shoshoni High School, said it was time to find a new solution for school funding, because “coal is not coming back,” and “oil and gas are not looking good, either.”

Back when Bebout was in school, traveling for a ballgame was often a reminder of the wealth disparities dotting Wyoming’s vast terrain of oil fields and coal mines.

“We’d go to some of those school districts that had a lot of oil production, and there was a clear imbalance in what they were able to provide for their students,” he said. “It wasn’t just athletics. It was in the band, it was in all kinds of extracurricular activities and in the schools themselves.” Classes were larger in those days, too, he remembered.

During his tenure of more than 25 years in the Legislature, Bebout, a Republican, consistently questioned school funding levels, suggesting money does not necessarily enhance performance.

“There was a balance that needed to be obtained,” he said. “But instead of finding a balance between the low side and the high side, we all went to the high side.”

State Sen. Charles Scott, R-Casper, who chairs the Senate Education Committee now, shares a similar perspective. He said Wyoming spends “too much in the way of administrators, some of the activities and busing students.” He also thinks too much is spent on school facilities.

Scott said he sees taxes as “a necessary evil” and prefers to look first for ways to trim the state’s education budget. “We’re in the process of seeing how far we can get that way,” he said. “After we’ve done that, then will be the time to look at increasing taxes to pay for what we want in education.”

An unquantifiable matter of pride

Bruce Thoren, superintendent of Fremont County School District 24, knows what he wants in education. He wants the plentiful resources he has now, the ones that fuel his small district’s 93-percent graduation rate.

He wants the social worker who teaches lessons about conflict resolution and growth mindset to all 383 students at Shoshoni. He wants the sometimes-expensive interventions needed to help special education students. And he wants those buses, which travel through winding mountain passes and fat slices of desert to allow kids to compete in basketball games, attend FFA conventions or just get to school. In wide-open Wyoming, buses represent academic opportunity.

“Without that opportunity to do what’s in the best interest of the kid and what’s best going to meet their needs at that time, instead of turning into a productive member of society, they may just be a drain on society,” said Thoren, who greeted nearly every student by name on a midmorning stroll down the freshly painted blue and white corridors of the school he considers a second home.

Sitting in his office overlooking the school parking lot, where the Big Horn Rams basketball team had just begun spilling off a bus after a four-hour ride, Thoren said he supports raising a tax to preserve the current school funding system – and to keep Wyoming’s small communities like Shoshoni alive.

Until recently, Shoshoni students attended school in a 1930s-era building that had weathered the wear-and-tear of many generations walking through its doors. The building was eventually demolished, and the state built the new 135,724-square-foot school in 2016. A school building as nice as the one the town has now is more than just a place to hold class, Thoren said. It’s a matter of pride for the whole community, and for students not least of all.

“You don’t see any trash in the parking lot when you pull up” now, he said. “That level of pride wasn’t there at the old school.”

A wide range of scholarship has explored whether more money for schools directly improves student academic outcomes, but the results are inconclusive, said David Thompson, a professor of education at Kansas State University. Measuring the value of intangible benefits, like students’ sense of pride in their school buildings, is even more difficult.

Experts do, however, accept the notion that countries that make higher investments in education have greater levels of social stability and economic productivity than those that don’t, Thompson said.

“Better-funded schools will most likely have higher test scores and graduation rates,” he said. “If you begin to withdraw resources, I think you’ll see those numbers go in an unfavorable direction.”

Thompson, who co-edited the 2019 book “Funding Public Schools in the United States and Indian Country,” describes Wyoming’s constitutional mandate to fund an equitable education as “one of the strongest in the nation” and one he wishes other states would replicate.

But Thompson said suggesting replication to policymakers usually gets them “running the other way.”

That’s because in most other states, sales tax, income tax and property tax make up the “three-legged stool” of school revenue bases. But in Wyoming, energy production revenues have allowed it to avoid relying on taxing residents ... until now.

Schools are key to diversifying industry

Shoshoni Mayor Joel Highsmith has lived through boom and bust in his hometown, which sits at the base of the Wind River Canyon, just off the highway tourists use to get to Yellowstone or Jackson Hole. Back when he attended the old Shoshoni High School between 1967 and 1971, the town was still years away from the uranium bust that hit in the 1980s.

“There was a lot more prosperity” at the time, he said. Shoshoni “was filled with a lot more young people, because there was a lot of work.”

These days, the school district is the town’s biggest employer. Next in line is a mushroom farm, followed by the only place in town to buy a candy bar: The Fast Lane Inc. convenience store and gas station.

Attracting new businesses to town is one of Highsmith’s primary goals as mayor. He’s been close a few times. This time last year, California-based pet supply company Laube Co. came to the area looking for a place to build a factory and warehouse. “They were very, very impressed,” he said, but the town didn’t have a big enough facility to accommodate Laube’s timeline.

He’s had interest from a few more businesses, but he’s worried about which way the school funding fight will go. Owners of a new business will want good schools to send their children to, he said. And they’ll want a qualified workforce.

Highsmith hopes the district’s technical offerings, including a state-of-the-art welding lab, which was upgraded last year with the help of a $122,000 grant from the state, will help develop that workforce and be a selling point for some of the companies scouting his town.

Austin Sullivan, a ninth grader who’s attended Shoshoni since kindergarten, has been spending several hours a week in the lab, rebuilding a motorbike he daydreams about racing through the Bighorn Basin.

“It’s actually my dream to become a mechanic,” said Austin, who started taking career and technical education courses in seventh grade.

Training future mechanics like Austin, along with young experts in other high-demand and emerging technical fields, is key to the state’s future, said Michelle Aldrich, state director of Wyoming’s career and technical education programs.

“If we’re going to diversify Wyoming’s economy and our tax base, we have to attract business and industries that don’t rely on the extraction industry,” Aldrich said. “In order to do that, we’re going to have to have a trained workforce.”

“I hope we’ve learned our lesson not to put all of our eggs in one basket,” she said.

Wyoming’s “death warrant”

Back in Shoshoni, though, there is really only one egg in the town’s basket. It’s the school.

“The school could be the deciding factor” in whether or not his plans to revitalize Shoshoni come to pass, Highsmith said. That’s why he and Konija, the town police chief, have decided that despite their general desire to keep taxes low, they support raising taxes to save their state’s schools.

“Refusing to even talk about it,” Konija said, is “essentially signing the death warrant for Wyoming.”