Joint Interim Revenue Committee Meets in Johnson County

Joint Interim Revenue Committee Meets in Johnson County

Guest Editorial By: Gail Symons

The Joint Interim Revenue Committee met at the Buffalo Hampton Inn for the first of two days of presentations, public comment and legislative discussions on increasing or improving the revenue streams for the state, counties and municipalities. This is the third such meeting this year in preparation for the upcoming Budget Session of Legislature in February 2018. Additional meetings are scheduled in November and December. The Management Council has directed the Interim Revenue Committee to identify options to raise an additional $100M, $200M and $300M to cover the shortfalls expected in Education funding. At the August meeting held in Thermopolis, the Committee voted to have the Legislative Services Office (LSO) draft legislation for their discussion in November.

The first discussion of the day was brought by the Wyoming Office of Tourism in conjunction with the Travel Industry Coalition. The challenge they were addressing is to stabilize funding for marketing efforts of the Office of Tourism in support of the second largest economic sector and the largest non-government employer for the state. Data confirms that the Return on Investment to state revenue is $11 for each $1 spend in Tourism Marketing. A joint working board was established to find best practices to fund what is currently a General Fund budget of $25M per biennium. Three options considered included remaining as General Fund and be susceptible to the ups and downs of economy and elections, instituting a statewide lodging tax at 3% to replace the $25M and instituting a one percent Tourism Tax across the 7000 series NAICS code for Leisure and Hospitality. Overwhelmingly the support was for the Tourism Tax which spreads the burden across all those who benefit as more equitable, puts the state in a more competitive basis with other states and keeps the percentage down. Public comment in support ranged from large motel, local restaurant, chain restaurant and a resort. As Senator Ogden Driskill pointed out, the Office is more than just Tourism, it is the State of Wyoming Promotion Board that effectively brands the state. This funding would allow the $25M current budget to revert back to the state. The committee approved LSO to draft legislation for their consideration at the November meeting.

Both the Wyoming Association of Municipalities (WAM) and the Wyoming County Commissioners Association (WCCA) discussed issues related to funding for local governments. Considerable effort across expended to update and produce the Municipal Finance Report which characterizes the challenges faced by local governments in raising the revenues necessary to provide basic services. The full report can be downloaded from the WAM site at http://wyomuni.org/. They continue to be reliant upon the $105M appropriation from the state which last year was covered by the Legislative Stabilization Reserve Account (LSRA), commonly known as the rainy day fund. Securing this funding was the first of the WAM recommendations. Others included revising tax laws to increase municipal revenue capacity including Local Option Tax Revision, Property Tax Revision which is not preferred but would be an additional tool with increase coming from a greater percentage of the Fair Market Value for resident and commercial property, Municipal Sales & Use Tax which was acknowledged as competing with the optional taxes, Permanent increase of Sales Tax to 5% as 21 of the 23 counties already have this and it is semi-permanent in that it can be extended by resolution and finally to Revise the Sales and Use Tax Allocation. The WCCA was only in agreement with the $105M appropriation. The next recommendation is to increase the cap for Severance Tax and Royalties and finally to remove tax exemptions that do not support Economic Development. That would include reinstating the grocery food tax. The Committee requested that WAM and WCCA jointly come to the next meeting with recommendations to find a way for self-sufficiency that they can agree upon. The LSO staff was also directed to find previous legislation submitted in the past on city local option tax for the committee to review.

Representative Burkhart submitted draft legislation that would provide for a fee of up to 20% of the outstanding debt to be applied if the debt to the state is referred to collection agencies. He had investigated how a recently initiated state debt collection program in South Dakota had been established. He found that their centralized Obligation Recovery System had successfully recovered $3M with a schedule for an additional $7.7M or 23% of their obligations in the first year while ramping up. CIG is the company that manages their collection and is also a contractor for the State of Wyoming as they developed and implemented the Wolf financial system for the state. There are a variety of tools and methods for increasing the effectiveness of their collection including a predictive dialer which automatically dials then transfers to a person when the phone is answered, Skip Tracing Tools, Automatic letter generators, Promise monitoring and linking payments for automatic funds transfer. Failure to meet the debts are subject to license revocation. State Auditor Cynthia Cloud testified that the debt collection processes have been an identified gap in state administration. Because this is decentralized to the departments and not a part of their core mission, it is not effective for most of them. Revenue Director Dan Noble described the extremely effective processes in their department. CIG has offered to provide a no cost assessment of the State Debt Collection and identify the opportunities for recovery as well as recommendations for process. The Co-Chairmen will sign a request to Management Council authorizing that assessment.

On Wednesday, the committee will continue discussions on the Gross Receipts Tax initially covered in the August, discuss proposed legislation on statute of limitations on excise taxes and constititutional requirements on Property Tax Abatement. The meeting agenda is available at: http://legisweb.state.wy.us/inte... and the meeting materials can be found at http://legisweb.state.wy.us/Inte...

Eye Care of the Big Horns
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Joint Interim Revenue Committee Meets in Johnson County
Joint Interim Revenue Committee Meets in Johnson County
SheridanWyoming.com

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