SHERIDAN — Wyoming may see its revenue decrease by more than 20 percent in coming years as oil, gas and coal prices remain low nationwide.
This data comes from a Consensus Revenue Estimating Group report that was released Monday.
That decrease is based on a revenue projection of approximately $4.45 billion for general government operations and schools in fiscal cycle 2017-2018; the current biennium budget has approximately $5.75 billion in projected revenue.
But some politicians aren’t running scared, as they see financial solutions on the horizon.
State Rep Rosie Berger, R-Big Horn, said the state has a permanent mineral trust fund and a legislative reserve account, both of which could help cover the balance.
The legislative reserve account alone has approximately $1.8 billion in it, earmarked for budget shortfalls.
“Certainly there is a conversation about if we should dip into that account,” Berger said.
State Sen. Dave Kinskey, R-Sheridan, said that conversation will include legislators who believe paying with reserves won’t be enough.
“The magnitude of the downturn is such that reserves alone cannot forestall the tough budgetary decisions that need to be made,” Kinskey said.
Kinskey said these budget woes come in part from new spending that’s been approved.
His example was spending $300 million on the Capitol Square project, which will primarily renovate the state Capitol building.
“I am hoping we can revisit many of those decisions in the next legislative session and dedicate what revenues we have to priorities such as education, senior citizens, streets and highways, veterans, cities, towns and counties, and water development,” Kinskey said.
A previous CREG report released in January bespoke of these potential budget shortcomings, and Berger said state officials have been getting ready for this situation for some time.
“We’ve been preparing for this natural resources downfall, we’ve seen the writing on the walls,” Berger said.
Kinskey said the budget will likely be cut — but from where he doesn’t know.
“There is no question that all aspects of the state budget will be under review and that everyone will share in the sacrifice, just as families and businesses have sacrificed with the downturn,” Kinskey said. “How much and to what extent each portion of the budget will be affected is unknown.”
But it isn’t the first time legislators have had to deal with low budget numbers, and Kinskey said they know what they’re up against.
“Those of us who have been through the booms and the busts know how deep the busts can go,” Kinskey said.
If there isn’t an increase in gas prices, the CREG budget numbers may not be as bad as it gets.
Berger said the plan should be to cut some spending, use the state’s savings and looking at the return on the state’s current investments.
Legislators will need to balance the state’s budget in February; Berger said before that Gov. Matt Mead will present a proposed budget and the Legislature will have an appropriations committee meeting in December.
However, before dealing with the 2017-2018 fiscal budgets, legislators still have to deal with the current $159 million needed to balance this fiscal year’s budget.
The state does have $109 million in its reserve budget account, an amount set aside every budget session, that can be used to pay part of this year’s deficit.