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February 21, 2013 8:46 am

Legislature looks to the future — but sometimes, too far

Written by Ilene Olson

The supplemental budget passed Friday by the Wyoming Legislature includes $20 million for distribution to the state’s cities, towns and counties. That’s good news, and it’s quite remarkable, given that state agencies are looking at budget cuts.

Gov. Matt Mead included the $20 million in his budget, which he submitted to the Legislature in November. The Legislature’s budget bill now is on Mead’s desk for his signature.

Since the amount of state mineral income provided to local governments was capped in the late 1990s, cities, towns and counties have relied on handouts from the Legislature to make up for that revenue loss.

Mead has said, correctly, that strong communities help make the state of Wyoming strong.

Meanwhile, the Legislature rejected Mead’s proposal to redirect some of the state’s mineral income now flowing into the Permanent Wyoming Mineral Trust Fund into the Legislative Stabilization Reserve Account, the state’s “rainy-day fund,” where the money would be accessible if needed.

Gov. Mead warned that the state might need that money during coming years, when energy revenue is predicted to remain flat.

Money put into the Permanent Wyoming Mineral Trust Fund is just that — permanent. It is locked away, and only the interest on the trust fund is available to pay the state’s expenses. While that could pay off in a big way in the future, interest rates now are low, and income from the trust currently is relatively small.

The Wyoming Constitution guarantees that 1.5 percent of the state’s mineral revenue from severance taxes flows automatically into the account.

But an additional 1 percent now going into the account is put there at lawmakers’ discretion. That money, or at least some of it, could — and should — go into the rainy day fund instead.

Money put into the permanent trust today won’t do much good if it’s needed to help pay the state’s bills and can’t be spent. In the long run, that could mean higher taxes and fewer government services for state residents, less economic development and some really tough years for the state of Wyoming.

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