Dems: Legislature’s ‘austerity’ makes energy job losses worse

Wyoming’s job losses in the energy sector began with the 2014 downturn in oil prices which resulted in 5,400 layoffs in the oil and gas industries throughout 2015. Even before the Legislature convened for its winter budget session in February, state leaders understood that more job losses were likely in the mining industry — an expectation that hit hard in northeast Wyoming with a combined 465 layoffs at Peabody Energy and Arch Coal mines on March 31.

But neither the Republican majority nor Democratic minority can point to specific measures taken to aid energy workers and their families.

“I think that as far as budgets, [the Legislature] did a lot of response and reaction in terms of diminishing revenues,” Rep. Norine Kasperik (R-Gillette) said. “At the time we weren’t losing the number of jobs.”

Sen. Chris Rothfuss (D-Laramie) agreed about the lack of attention to dwindling jobs, saying “There is nothing in this budget for those folks”  — workers and their families suffering from layoffs in the energy sector. “I would not say there was any discussion [about job losses], only in maintaining the level of construction the state was doing to maintain the construction jobs.”

With an estimated revenue shortfall of nearly $600 million through 2018, the GOP-led Legislature made sweeping cuts to the budget that included a 1 percent “penny plan” cut for all state agencies — excluding the Department of Health — to be applied in 2017 and again in 2018, while maintaining a capital construction budget in excess of $300 million. Another $80 million remains for school capital construction.

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The Legislature also eliminated 38 jobs when it cut the adult literacy program — which aims to build the skills of Wyoming’s workforce. More than $750,000 was cut from Workforce Services, which is on the front lines of state services that laid off workers might depend on.

Kasperik said the “belt-tightening” does benefit the state generally in balancing spending with declining revenue in order to maintain a healthy budget and savings. But she acknowledged there’s nothing in the state’s new biennium budget that directly aids workers who have lost their jobs in energy since the beginning of 2015.

Expenditures for Wyoming’s community colleges and the state’s municipalities, were trimmed too, leaving those entities with fewer resources to deal with increases in unemployment, retraining and demand for social safety net services. At the same time, local sales and use taxes have declined statewide by some $120 million, according to state figures.

“They’re pulling together, they’re working together” to deal with job losses, Kasperik said.

State’s response

Gov. Matt Mead and Republican-majority lawmakers spent the past week touting the state’s response to recent job losses in the energy sector.

Mead issued a press release reiterating the state’s deployment of teams from the Department of Workforce Services, Department of Insurance, community colleges and others to communities in northeast and central Wyoming. He also listed job openings at various state agencies, including 164 open positions throughout the Wyoming Department of Corrections.

“Since January, more than 2,400 Wyoming residents have lost jobs in the energy industry,” Mead wrote. “Wyoming has established full-service resource centers in Gillette and Douglas.

“Wyoming construction employers, the Wyoming Highway Patrol, the Wyoming Game and Fish Department, the Wyoming Department of Transportation, Wyoming State Parks and Cultural Resources and others have job openings now,” Mead continued. “Some jobs are being offered on the spot.”

Mead’s office provided a list of Wyoming contractors with contact information.

Rep. Kasperik said participants at a recent job fair in Gillette identified some 600 open positions, and said she wants to “dispel any concern” that there are no open jobs available in the midst of the energy downturn.

“There’s a lot going on around here,” Kasperik said. “We, like everybody, want [workers] to stay and work here. That’s the No. 1 priority. We want people to know there are opportunities available.”

A lot of the available jobs in areas where energy work is down are for construction workers and truck drivers, she said.

Austerity vs belt-tightening

“The budget was the policy equivalent of sticking our head in the sand,” Rothfuss said. “It did nothing to limit the time we are in the bust, and did absolutely nothing to diversify the economy.”

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There were a lot of measures in Mead’s budget that would have maintained state services that out-of-work residents and their families may rely on, he said. But the Joint Appropriations Committee rejected a lot of those recommendations. The biggest, perhaps, was the governor’s recommendation to expand Medicaid.

In refusing to expand Medicaid for the fourth year in a row, Wyoming also refuses to accept some $260 million in federal dollars to support healthcare providers and those who would qualify — estimated at about 20,000 Wyoming residents. Rothfuss said refusing to expand Medicaid also added more than $30 million to the budget deficit because it would have otherwise gone to the Department of Health to help administer the program.

The failure to expand Medicaid “is an absurdity at this point,” Rothfuss said. Not only would expansion help provide healthcare insurance for those 20,000 residents who fall in the “Medicaid gap,” but the number of qualified enrollees will likely increase with continued layoffs in the state. “And we refused that,” he said. “From an economic-development outlook that was something we explicitly refused to accept.”

All 13 Democratic legislators protested Wyoming’s budget by voting no on the final budget bills in their respective chambers. Rothfuss said state lawmakers took an austerity approach that included cutting social safety net programs — a tactic that he says is proven to hobble economies, not boost them.

“I hope folks will take a look at this — that the state of Wyoming is not investing in itself but investing hundreds of millions of dollars in Wall Street,” Rothfuss said. “The state is getting exactly what they voted for: conservative budget, cuts to programs.”