CHEYENNE–After negotiations faltered between House and Senate mediators Tuesday, a bill to cut residential property taxes by 25% is headed to Gov. Mark Gordon’s desk.
“This is probably one of the most important issues facing the state Legislature, and I want to compliment the House, because I know that they also wanted proper tax relief,” Senate Vice President Tim Salazar, R-Riverton, said Thursday morning during a Joint Conference Committee meeting to reconcile different versions of Senate File 69, “Homeowner property tax exemption,” passed by the Senate and the House.
The meeting was a shift from Tuesday, when Senators on the committee expressed surprise and disappointment at their House counterparts’ decision to vote down a proposed compromise on the bill. House members had said they simply needed more time, and that appeared to do the trick.
“We’ve had a chance to meet with our House Republican caucus. Last night, we discussed this bill at length. I’ve had a chance to discuss it with a few of our minority party members as well,” House Majority Floor Leader Scott Heiner, R-Green River, said, adding that they “ran a bunch of numbers” on the Senate’s compromise.
“We would like to accept the Senate’s position that was offered on Tuesday morning,” Heiner said.
The bill now includes a 25% exemption on the first $1 million of a single-family home’s fair market value. It does not include a backfill to offset lost local government revenues, nor a sunset date. The exemption would go into effect immediately, with an owner-occupied stipulation kicking in the second year with a consideration for homeowners who are deployed military members.
Fiscal impact
Before all six members of the JCC voted to adopt the proposal, Heiner made a request in light of the Senate’s announcement last night that it would not pass a supplemental budget.
Heiner asked that the JCC add $15 million in backfill for special districts related to health and emergency management services — an appropriation the Senate had included in its budget bill. Similarly, the House’s budget bill earmarked $72 million in grants for local governments in the state’s eight “hardship” counties.
But with the Senate skipping out on the budget this year, both of those appropriations are set to be left behind.
“We know that special districts rely heavily upon property taxes, more so than most of the other government entities,” Heiner said. “And so this would be for the first year to provide some help as their revenue gets dramatically decreased,” Heiner said.
Property taxes do not go to the state, but instead stay with local governments and fund public services like K-12 education and transportation, law enforcement, senior centers, hospitals, water and sewer, community colleges, libraries, roads and sidewalks.
The Senate declined Heiner’s proposition before he withdrew it. While Salazar said he appreciated the idea and understood where it’s coming from, a 25% exemption will be “negligible” in terms of revenue reduction.
That’s not the way local governments see it.
“A 25% exemption is neither negligible nor would a 25% reduction of any major state funding source,” Jerimiah Rieman, executive director of the Wyoming County Commissioners, told WyoFile in an email.
Instead, Rieman wrote, the bill as passed by the JCC “will diminish county government services and will make counties more reliant on state revenues and Wyoming’s mineral industry.”
The bill should be considered in the context of other legislation, Rieman wrote, including exemptions put into law last year and two other tax bills already enacted this year. The latter pair combined are estimated to reduce local government revenues by $42.2 million in fiscal year 2027.
“These revenue reductions, when combined with Senate File 69 and other legislation still under consideration is beyond comprehension,” Rieman wrote.
Throughout the session, local governments have called on lawmakers to seek targeted relief for homeowners in place of blanket cuts. And for a time, SF 69 took that approach thanks to an amendment from Rep. Ken Clouston, R-Gillette. However, the Wyoming Freedom Caucus ultimately stripped it out of the bill after initially supporting Clouston’s proposal.
Part of local governments’ concerns come from the fact that home values — and with them property taxes — have spiked in only certain parts of the state. Eight counties, for example, collect less in property tax now than they did in 2015, according to an analysis by the Wyoming Taxpayers Association.
There’s also a longstanding structural revenue gap between mineral and non-mineral counties, which Rieman said will only be exacerbated by SF 69.
Several local government representatives were at the Capitol Thursday for a Wyoming Association of Municipalities luncheon with lawmakers. That included Laramie Mayor Sharon Cumbie.
“Long-range planning and fiscal responsibility are core values of both the city and the city council. And they guide what we do,” Cumbie told WyoFile.
“To suddenly have a dramatic shift is quite an interruption,” she said.
Both chambers are now expected to approve the bill before sending it to Gov. Mark Gordon’s desk for consideration. He has the option to sign, veto or let it become law without his signature.
The post Wyoming lawmakers agree to 25% property tax cut appeared first on WyoFile .