CHEYENNE, Wyo. — Some Wyoming lawmakers are pushing for a more open discussion about state savings policies as the balance in the state's "rainy day fund" nears $2 billion.
According to a recent report from the state's Consensus Revenue Estimating Group, the balance in the state's Legislative Stabilization Reserve Account has climbed nearly $400 million in the past two years to stand at $1.96 billion as of June 30.
The savings come as Wyoming's overall state operating budget has clocked modest increases over the CREG's projections earlier this year. The group reports over $37 million in extra general fund revenue on a total general fund budget for the year of over $2.2 billion.
State accounting standards don't allow the group to count realized capital gains on state investments until the end of the fiscal year. In the first few months of the fiscal year that started this July, the state has banked over $80 million that's not included in the CREG figures.
Wyoming's total investment portfolio stood at over $19 billion at the end of the fiscal year in late June, according to a recent report from the state treasurer's office. That includes over $10 billion in permanent funds, over $6 billion in state agency operating funds as well as other funds such as the endowment for the state's Hathaway Scholarship Program, which funds college scholarships for in-state students.
With no personal or corporate income tax, Wyoming leans heavily on taxes on energy production to fund state government. The CREG report states oil production in Wyoming has increased for four consecutive years and is on pace to extend that run this year.
However, the report states that Wyoming's natural gas production has dropped every year since 2011. It also says the state's coal industry faces many obstacles, including federal environmental regulations and fuel switching for new and existing plants.
The state relies heavily on federal mineral royalties to fund K-12 education and the CREG report predicts those funds may be curtailed in the future.
Unlike the state's permanent funds, state lawmakers could tap money from the Legislative Stabilization Reserve Account to pay for operations or projects.
Wyoming lawmakers passed a two-year state budget early this year. Republican Gov. Matt Mead will submit his recommendations for a supplemental state budget to lawmakers later this year for consideration in the general session that starts early next year.
Rep. Steve Harshman, R-Casper, is chairman of the House Appropriations Committee. He said Friday that uncertainty about the future of the state's coal industry makes it prudent to continue to hold substantial savings.
"I don't think we're at a point where we're in a rainy day and need to spend any of that money out of there," Harshman said of the reserve account.
"Revenues are still doing well," Harshman said. "There are obviously storm clouds with coal, and coal-lease bonus, most of the real kind of storm clouds out there are on the education side."
Sen. Hank Coe, a Cody Republican and former Senate president, said Friday he likewise wouldn't favor spending from the reserve account.
"I happen to think of being prudent, and I think that it's easy to be nearsighted, but I like the fact that we're being a little farsighted with that, and I like that amount of money in the LSRA right now. I think that's a good fallback. Even though it's a rainy day fund, in a couple of years, it could be raining."
House Minority Floor Leader Rep. Mary Throne, D-Cheyenne, said she believes lawmakers need to have an open discussion about whether increasing savings is the best policy.
"With school districts that need money and decaying infrastructure, I don't think it makes a lot of sense to stuff money under the state's mattress, so to speak," Throne said Friday. "Above all, we just need to talk about it in an open and honest discussion. If there's a good case for saving that much money, then make it publicly on the floor, and tell us why we need to do it, and why it's a priority above other priorities such as fixing roads."
Rep. Ken Esquibel, D-Cheyenne, serves on the House Appropriations Committee. He said Friday it's clear the state education system needs increased funding.
Considering that the state has $2 billion in savings, "it's not a real good way to legislate, I don't think," Esquibel said.