Oil and natural gas production and prices have bounced back in Wyoming. In Park County, it looks like our property tax base grew by perhaps 12 percent last year, spurred in large part by more mineral production, though also by rising home values.
On the whole, that’s all a good thing: Business in the oil patch has picked back up, this remains a desirable place to live and times won’t be quite so lean for our state and local governments.
But it’s not the time to kick back and relax. Now is the time to figure out how Wyoming can work toward breaking the painful boom and bust cycles that have plagued this state since its inception.
For better and worse, the state’s fortunes have been joined at the hip with the minerals industry.
When foreign sheiks start fiddling with oil prices, Uncle Sam imposes tough new regulations on drilling or Wall Street decides it doesn’t like coal, down into the doldrums we go, with layoffs and less money. Then, when the market turns or administrations change, we shoot back up. You’d be hard-pressed to find anyone who thinks the swings are a good thing.
One year, Wyoming teachers are getting laid off and programs are being axed; the next year, government leaders are building new amenities and the debate is over how large the raises should be.
At times it feels akin to trying to run a marathon at either a dead sprint or a crawl.
Our elected officials have helped take the edge off of the ups and downs by generally spending conservatively and socking away money during the good times. We hope they continue to do that as the state’s finances rebound.
But in a way, it’s papering over the problem: A whopping two-thirds of Wyoming’s tax revenue (roughly) comes from the minerals industry. That’s a lot of eggs to have within a single basket.
When you bring up the state’s dependence on minerals, legislators and other politicians can be quick to say something like, “We need to have a conversation about revenue enhancements.” To translate, that’s the politically correct way of saying that maybe we should look at some new or different taxes in Wyoming.
We understand the reticence to openly talk about changing our tax structure; just the mention of introducing, say, a state income tax is enough to get our hackles up.
But our lawmakers and other leaders must have the courage to take an honest look at how we can create a stable tax base. The issue is not “how do we drum up more money to dump into government coffers?” but, “how can we tax ourselves in a more fair, sustainable way?”
The fact is that Wyoming’s mineral producers have been picking up the tab for everyone else’s government services — from public education to infrastructure. But as the very terminology suggests, you cannot rely on nonrenewable resources forever.
Gov. Matt Mead and lawmakers have launched a well-publicized initiative called ENDOW (Economically Needed Diversity Options for Wyoming) that’s aimed at diversifying the state’s economy. We’re encouraged by some of the ideas put forward and acted upon so far, and we’re looking forward to hearing the solutions that local and state candidates will suggest on the campaign trail this year.
And, along the way, we hope to hear some innovative thoughts on taxes, too.