M I N U T E S

JOINT REVENUE INTERIM COMMITTEE

Parkway Plaza Hotel                                                                                  June 25 and 26, 2001

Casper, Wyoming

PRESENT:            Representative Pat Nagel, Chairman;

Senator Robert Peck, Cochairman;

Senators Dick Erb, Irene Devin, Rae Lynn Job and Jayne Mockler;

Representatives Rodney "Pete" Anderson, Chris Boswell, Roy Cohee, Nick Deegan, Roger Huckfeldt, Doug Osborn and Jane Wostenberg.

Legislative Service Office:  Mark Quiner, Assistant Director.

Others:  See Attachment A for those attending on June 25, 2001 and Attachment B for those attending on June 26, 2001.

ABSENT:              Representative Phil Nicholas.

*  *  *  *  *

Monday, June 25, 2001

Cochairman Peck called the meeting to order at approximately 1:00 p.m.   The order of the meeting generally followed the prepared agenda (see Attachment C).

Overview of Local Government Budgeting and Reporting

Mr. Mike Geesey, Director, and Ms. Pam Robinson, Administrator of Public Funds, Department of Audit, gave the Committee a presentation on the reporting requirements for local governments including cities, towns and counties.  Mr. Geesey and Ms. Robinson also provided information on the budget process for local governments as well as their financial information (see Exhibit A-1).  It was explained federal law requires census reporting each year by county governments which is due by September 30.  The Department of Audit has legal authority to require audits to be completed by counties if an audit is not done each year.  Cities with inhabitants over 4,000 have the same reporting requirements as do counties.  Currently there are many towns in Wyoming with a population under 4,000.  The reporting requirements are different for these cities.  Ms. Robinson reported that property taxes account for 56 percent of total revenue to counties, state aid accounts for 27 percent, and federal aid accounts for 5 percent.

Cities and Towns Budgeting Process

Mayor Mike Mills of Newcastle, Wyoming, explained the Committee would hear presentations from Newcastle, Mills and Cheyenne on typical budgeting processes.  He thanked the Committee for the opportunity to provide this information and for the Committee's study of this issue.  He indicated the cities, towns and counties want to be part of the solution and not part of the problem.  He feels it is prudent to invest money generated in Wyoming back into Wyoming through means of local governments.  This creates stronger, more stable communities.

Mr. Gregg James, Treasurer-Clerk for the City of Newcastle, explained the budget process.  He indicated they first analyze the fiscal picture, then ask for review and requests by city departments, and for public input at a public hearing.  He stated the last couple years' revenues received have exceeded revenues expected.  The major concern is with general fund monies.  He felt the cities have been treated well by the State Land Board when they need loans or grants for certain projects.  However, the problem is with the lack of funding for street projects.  No money is available from the State Land Board for street projects (see Exhibit A-2). 

Mr. Don Russell, Mayor of Basin,  explained Basin is a town of 1,238 people.  This is an increase from 1,185 from the last census.  He noted the town is starting to be a retirement community.  He also indicated there is a problem with finding adequate funding for city streets.  It is an expensive proposition to fix city streets and he would like to see a source of funding for that purposes.

Mr. Jack Spiker, Mayor, Ms. Barb Dorr, City Treasurer and Mr. Tim Wilson, Director of the Board of Public Utilities, all from the city of Cheyenne, explained their budget process (see Exhibit A-3).  Ms. Dorr explained the budget process where the city receives requests from the departments and then does an analysis of potential revenue.  She stated the requests from the departments were $8.5 million in excess of estimated revenues.  She indicated property taxes account for 8 percent of the revenue.  The city keeps at least 90 days reserved money on hand, which amounts to about $8 million.

Mr. Tim Wilson, Director of the Cheyenne Water Enterprise Fund for the Board of Public Utilities, indicated the city approves any rate increases and debt incurred by the utilities (see Exhibit A-4).  He thanked the Legislature and the Wyoming Water Development Commission for the assistance in water development projects.  He felt Wyoming has the best system in the United States for water development projects.

Mayor Spiker felt the city of Cheyenne had been treated well by the State Land Board.  He indicated since January of 1987 Cheyenne has received every grant they asked for from the State Land Board except for the last two requests and those were for road projects.  Mayor Spiker did note there is a problem in city employment with turnover.  He stated the sanitation department had a 100 percent turnover last year.  They have lowered the turnover rate to 30 percent, but the city still loses many employees to the State of Colorado.

Mr. George Parks, Executive Director of the Wyoming Association of Municipalities, provided the Committee with information on state shared funding for cities and towns (see Exhibit A-5).  Mr. Parks provided information on the mill levy that cities are allowed to levy for different governmental services.  He also provided information on state revenues that flow to cities and towns. 

The meeting adjourned at approximately 5:00 p.m.

*  *  *  *  *

Tuesday, June 26, 2001

Cochairman Nagel called the meeting to order at 8:30 a.m.  The order of the meeting generally followed the prepared agenda.

Ms. Johnnie Burton, Director of the Department of Revenue

Ms. Burton gave information on a streamlined sales tax update to the Committee.   The task force is still working on exemption procedures for state laws.  Twenty-nine states are working on this project.  Wyoming was the first state to accept and pass legislation as a result of the Committee's work.  The goal is to make it simpler to enforce state tax laws and devise a method for collection of taxes on internet sales.

Ms. Burton gave an update on the Mineral Valuation Committee.  The Committee is working on the issue of processed gas which is not sold at an "arms length" transaction.  The Committee currently has a bill for introduction in the upcoming session.  The other issue the Committee is addressing is to reduce the period for amending reporting and audit from five years to three years.  The Committee has drafted a bill on this topic.  At the next meeting, the Committee will look at mineral liens.

Ms. Burton then gave an update on the direct shipment of wine.  She explained legislation passed by the 2001 legislature allows for winemakers to ship their wine directly to Wyoming consumers.  She said many wineries have registered with the state.

County Budget Process

Mr. Joe Evans, Wyoming County Commissioners Association, Debra Lathrop and Kim Lovett from Laramie County, all provided information on county budgeting and finances (see Exhibit B‑1).  Mr. Evans explained the potential revenues for counties and the many functions county officers do.

Ms. Debra Lathrop, Laramie County Clerk, gave an overview of the county budget process.  She explained how the county departments submit their requests to the budget officer and then the county commissioners hold a public hearing, determine what budget will be adopted and then impose mills to pay for the adopted budget.

The Committee heard similar concerns regarding county finances from Dan Evans, Campbell County Commissioner; Marilyn Connolly, Johnson County Commissioner; Dick Lindsey, Natrona County Commissioner; Donna Ruffing, Niobrara County Commissioner; Pat Gabriel, Albany County Commissioner; and Scott Harnsberger, Fremont County Treasurer; all expressed concern regarding county finances and the need for steady funding from the state.

Recreational Vehicle Registration

Mr. Vannis Parkhurst and several others provided information to the Committee regarding their concerns for what they feel are overly high registration fees for recreational vehicles and motor homes in this state (see Exhibit B-2).  Following presentation to the Committee, concern was expressed over the Committee's current load of interim topics to study and it was the feeling of the Committee there was inadequate time to address this issue properly.

Severance Tax Prepayment

Mr. Dan Sullivan provided the Committee with information regarding severance tax prepayment.  Such a scheme would allow future tax credit for prior payment of impact assistance monies (see Exhibit C-1 and C-2).  He indicated the State of Colorado passed such a law around 1979.  Mr. Sullivan indicated the method would allow future credit against severance or property taxes for a new operation equal to the value of approved contributions by the taxpayer used to assist in solving impact problems of units of local government resulting from initiation of new operations.

State Revenue Update

The Committee had been scheduled to receive a revenue update on the state revenue picture.  Due to technical problems, a conference call was unable to be held by the Committee, but the Committee did receive a handout on the issue (see Exhibit D-1).

Adjournment

Following discussion, Cochairman Nagel announced the Committee will meet July 16 and 17 in Casper.

The meeting was adjourned at approximately 1:30 p.m.

Respectfully submitted,

Senator Robert A. Peck

Cochairman