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Sales tax for K-12 blocked in committee

Feb 22, 2017 By Mead Gruver, The Associated Press

CHEYENNE (AP) -- A proposal to raise the state sales tax got a chilly reception Tuesday in a legislative committee where lawmakers advocated a wait-and-see approach about using the strategy to address a major funding shortfall for K-12 education.

The Senate Education Committee removed the proposed half-cent sales tax increase -- from 4 to 4.5 percent -- from a Wyoming House plan to fix the deficit of more than $360 million. It kept education spending cuts on the table.

The revised bill heads to the full state Senate after clearing the committee with a lone "no" vote cast by the only Democratic member, Sen. Chris Rothfuss of Laramie.

The sales tax increase would have kicked in after unobligated funds in a state savings account fell below $500 million.

That drop might not happen for some time and legislators should retain flexibility to act later as they see fit, Republican committee member Sen. Affie Ellis of Cheyenne said.

"I don't want to tie our hands today and tie the hands of future legislators when we don't know what the economic situation is going to look like when this takes effect," Ellis said.

Rothfuss countered that Wyoming needs more revenue immediately for education.

"It is a herculean effort to get anything that has the word tax out of the House and get it over to the Senate where we have a chance to address the problem," Rothfuss argued. "It's pretty clear that the tax side is an important counterpoint to the cut side."

The shortfall results from declining revenue from coal, oil and natural gas extraction, all of which have suffered downturns over the past few years.

Coal lease bonus payments to the state have all but dried up amid lack of interest in new federal coal leasing in Wyoming and a moratorium imposed by President Obama last year.

Committee chairman Hank Coe, a Republican from Cody, noted that the payments had funded $3.4 billion in school construction and improvements over more than a decade starting in the early 2000s.

Sooner or later, Wyoming will need to find new revenue for school construction, too, said Republican committee member Stephan Pappas, a Cheyenne architect.

"While I don't like new taxes -- who does? -- I think we really need to find a new revenue stream," Pappas said.

Rothfuss floated but didn't get support for raising the state sales tax half a percent immediately to shore up the $360 million shortfall.

"We've got time to come back during a budget session" and discuss raising the sales tax, Coe said.

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Follow Mead Gruver at https://twitter.com/meadgruver

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2017-10-22