2012 budget session started Monday

With natural gas prices dropping beyond last fall’s predictions, many lawmakers are preparing to tighten the state’s budgetary belt during the Wyoming Legislature’s 2012 budget session.

The session started Monday in Cheyenne.

Three local legislators talked last week about the budget and other issues they expect to dominate much of their time and effort this time around. They include redistricting; funding for health care, education, highways and local governments; and a general tightening of the budget, among others.

Tight agency budgets

“I think this is going to be a different budget session than I’ve experienced before, with gas pricing as low as it is,” said Rep. Elaine Harvey, R-Lovell.

Harvey, who represents House District 26, said she expects this session to be “a little more painful.”

“Everybody is excited about, ‘Let’s get a handle on government,’” Harvey said. Still, when cuts are made or proposed, the reaction often is, “But wait — not that one!” she said.

Sen. Ray Peterson, R-Cowley, represents Senate District 19 and sits on the Joint Appropriations Committee. He and other committee members spent four weeks recently going over Gov. Matt Mead’s budget proposal.

“We flatlined everybody’s budget from the last biennium,” he said.

The only increases allowed in agency budgets were for technology improvements such as software and computer upgrades, printers and other equipment needed to keep offices functioning, he said.

“We froze everything else. We didn’t give any raises to any department,” Peterson said.

Other requests, such as additional money to pay for increasing utility and travel costs for new program startups also went unfunded under the committee’s markup of the governor’s budget request.

Medicaid woes

Peterson said the Wyoming Health Department’s two-year budget is $1.5 billion — 90 percent of which will pay for the Medicaid program.

He noted the Legislature had to provide another $37 million for Medicaid last year to back-fund the program when the money appropriated in 2010 proved insufficient. While some members of the committee wanted to take that money back out of the budget for the coming biennium, Peterson said he disagreed.

“We want to make sure they run as efficiently as possible,” he said, but “this money was spent last year, and we know it’s not going away. I was probably the only one on the JAC that was fearful of cutting that $37 million away.”

As a compromise, the committee voted to cut the $37 millon but also set aside $20 million in an account that the governor can provide later for Medicaid if necessary, he said.

To help reduce Medicaid costs, Peterson said he will sponsor a bill that would allow the state to take providers who falsify claims to civil court.

“Now, we don’t have a false claims act, so the attorney general has to work through the federal government to take them to federal court,” he said.

“By having a small claims act, we would be able to go after them in small claims court. If we find $100,000 in Medicaid fraud, we can go after $300,000. If we catch them at $100,000, it’s likely they have committed $300,000 in fraud.”

Peterson said he introduced a similar bill last year that passed the Senate but failed in the House. While it was being debated, an eye doctor in Cheyenne was being investigated for Medicaid fraud amounting to $250,000.

“He claimed he was doing tests, and he didn’t even have the equipment to do the tests he said he was doing ...

“It (Medicaid fraud) robs us of our tax dollars and ... it’s detrimental to patients’ health,” he said.

Medicaid represents a large part of the state’s budget, Peterson said.

“Everybody starts talking about (Interstate) 80 being the big gorilla in the room; I say I-80 is cake compared to Medicaid,” he said.

Highway funding

Even so, highway funding also will be a hot-button topic, said Rep. Dave Bonner, R-Powell, who serves on the House Transportation, Highways and Military Affairs Committee.

Bonner, who also is publisher of the Powell Tribune, said, “Highway funding will get a lot of attention in this legislative session, and I’m on board all the way.

“WYDOT says it needs $134.5 million a year in additional funding just to keep the highways in as-is condition. That’s not building new road. That’s just maintaining roads as they are.

“The governor has recognized the importance of the highway system in this big state. He wants to see highway infrastructure improved, and he has recommended going to Abandoned Mine Land money as a source of revenue. I want to see the Legislature support that, and do even more.”

Bonner said the Transportation Committee spent the interim trying to identify ways to provide additional money for the Wyoming Department of Transportation’s Highway Fund.

Those include:

• Increasing the cost of obtaining all classes of driver’s licenses and the cost of annual motor vehicle registration.

“It’s been some length of time since these fees were adjusted,” Bonner said, noting that the cost for new or renewed driver’s licenses doesn’t cover the department’s costs to issue them.

• Moving revenue from court-collected fines and forfeitures into the Highway Fund. Money from fines presently is credited to local school districts.

That change, if passed by the Legislature, would require approval of a constitutional amendment by voters in the next general election, Bonner said.

• Ending the 40-cent per gallon ethanol tax credit in the state,

• Crediting sales taxes collected on the sale of off-road diesel fuel to the Highway Fund rather than the General Fund.

• Imposing a $150 fee to cover the Department of Transportation’s cost when installing an ignition interlock device.

Education funding

Education funding also will be a subject of debate, Peterson said, particularly regarding the scale by which teachers’ salaries are computed.

The current education funding formula provides additional money for teacher salaries in areas with high costs of living, such as Jackson (Teton County) and Gillette (Campbell County), based on the Wyoming Cost of Living Index.

Some lawmakers want those salaries to be based on a regional hedonic cost of living scale instead, as they were before, and that would reduce the additional amount those school districts receive.

“I can see both sides,” Peterson said. “It will be a good debate that will get a lot of discussion.”

Harvey said she also expects education to be among the hottest topics of the session.

“I think education will be huge,” she said.

Harvey said she opposes a return to computing teacher salaries based on the Hedonic scale, which she believes could put education “back in the hands of the courts.”

Redistricting

Harvey also expects redistricting to garner legislators’ attention.

“I’m not concerned about the Big Horn Basin,” she said. “I think we’ve done a pretty good thing with making sure the Big Horn Basin has a good, solid representation.”

But debate continues in the northeast, southwest and southeast portions of the state, she said.

She noted that, in the southeast corner of the state, proposed boundary lines place Sens. Kirk Meier, R-LaGrange, and Wayne Johnson, R-Cheyenne, in the same Senate district.

“Hopefully, that doesn’t take us into extra days or set a tone of contention,” she siad. “I hope we can come to a workable, peaceful solution.”

While healthcare spending certainly will be a topic of discussion, Harvey said she thinks most of the debate will occur in a future session of the Legislature.

Health care

She said three studies regarding health care issues were authorized previously by the Legislature, and none of those studies has been completed.

“We want a very thorough examination of all of them,” she said.

One thing she’s certain of, though.

“The more I see, the more I’m in strong disagreement with the federal government. I don’t think they have it right for Wyoming. I don’t think (the federal health care law) is going to stabilize costs, and I don’t think it’s going to provide more access.”

As chairwoman of the House Labor, Health and Social Services Committee, Harvey said she wants to investigate creating a Wyoming model that could have lower costs and more flexibility.

“Less coverage is better than no coverage,” she said. “It will protect people and their assets from bankruptcy, and that’s the whole point of insurance, anyway.”

Funding for local governments also will be on the Legislature’s list of topics.

Local governments

“I am glad the governor and the JAC are on the same page with funding for local governments, at least in the total for distribution,” Bonner said. “That would call for cities, towns and counties to share $135 million in the next year.

“The governor wants to see more of it distributed through the county consensus process for local projects, and the JAC would prefer to see the lion’s share in direct distribution of cash.

“The JAC would allocate 60 percent in cash payments based on population and 40 percent by consensus block grant,” he said.

Under the JAC formula, the city of Powell would receive $361,683 in direct distribution, Cody would get $540,254, Meeteetse $28,214 and Frannie $1,058. Park County would receive $589,426 in direct distribution, with roughly $2.5 million for award in the consensus block grant process, Bonner said.

Peterson said the Joint Appropriations Committee is trying to get as much money as possible to cities and counties, but it’s likely the demand will be greater than the money available.

“Like everyone else, when there’s extra money, that’s great; when there’s not, the kicking and screaming starts ... It will be interesting to see what local towns and counties, what their position is at. I guess I’m a little cynical, having just gone through four weeks where every agency is critical and the sun won’t come out tomorrow and everybody will die.

“I’ve heard it all before,” he said. “The sun will come up tomorrow, everybody will not die, and we’ll be OK.”

Peterson predicted a “feeding frenzy” over the $20 million that remained in the budget after the JAC markup of the budget.

“There wasn’t much left,” he said. “It won’t go very far.”

Harvey said the end goal is to make wise decisions and come up with a balanced budget.

“We’re going to balance the budget and work hard at setting an example for the federal government ... When you don’t have money, don’t spend it.”