SHERIDAN — A bill that will provide crucial funding to local governments throughout the state passed on third reading in the House Wednesday.
The bill has already been approved by the Senate and will be forwarded to Gov. Matt Mead for final approval.
The legislation would authorize the state to distribute $105 million in direct distribution funding among local state governments. Rich Kaysen, the executive director of the Wyoming Association of Municipalities, said the bill was extremely important to state municipalities and he is relieved it passed.
“We are most appreciative to the legislators for recognizing the need for local governments to remain strong,” Kaysen said.
Locally, direct distribution funding has been used to support a variety of one-time expenses, such as project funding, equipment replacement and infrastructure improvements. Because direct distribution funds need to be approved by the Legislature each biennium, they cannot be used for ongoing payments like salaries, wages or employee benefits.
In Sheridan, direct distribution funds have been used to remodel the police station and city hall, replace emergency vehicles, purchase snow removal equipment and improve city parks and streets. Sheridan city administrator Mark Collins said if direct distribution continues from the state, a portion of the funds will go toward a new ladder truck, which could cost upwards of $900,000, for the city fire department.
Likewise, the county has used direct distribution funds to renovate the county jail and improve its monitoring system, fund an archiving project for the county clerk of district court and fund capital improvement projects like road and bridge repairs.
Collins said direct distribution funds are crucial to municipal budgets, which is why WAM makes advocating for those funds its chief priority.
“It becomes an essential funding formula for what we consider to be critical infrastructure,” Collins said. “If for some reason we did not get the direct distribution, or got a fractional percentage, we would have to go back from a budgetary standpoint and reprioritize our [infrastructure projects] and figure out what we would have to do without.”
As budgets continue to shrink throughout the state, there have been concerns that direct distribution funds could be reduced or cut.
“Since we’ve had such a decline in revenues, [losing direct distribution funds] has always been a concern,” Sheridan County administrative director Renee Obermueller said. “We have facilities and campuses that need upgrades and continuing maintenance…Because they’ve taken away the block grant money, taking that away and then taking out the direct distribution would be very, very concerning for the county.”
Local governments in Wyoming have limited fundraising capabilities, which would make replacing lost direct distribution funds difficult. For the county, Obermueller said sources of revenue need to be allowed statutorily.
In most cases, however, revenue sources the county has proposed adding — increased fees in the district clerk’s office, for instance — would not create significant revenue streams.
“Economy and jobs puts that money back into the local government level and that keeps us afloat,” Obermueller said.
On the city level, WAM has encouraged the state to allow municipal governments to create taxes that would allow them more financial independence, and Collins said Sheridan would benefit from the financial stability that would create.
“If we had the ability through sales and use tax, and other means, to raise funds locally, I think that that’s beneficial to us as a community and allows us to chart our future fiscally in a better fashion,” Collins said.
He added, however, that negotiating that authority will be a “long-term discussion.”
Gov. Mead will need to approve the direct distribution bill before it is finalized. Gov. Mead’s proposed budget recommended a $105 million allocation for direct distribution funding, the amount awarded by the bill.