Wyoming legislature tackles ‘most important step’ of budget session

“I feel like I am negotiating a lease to go out and drill,” said Sen. Eli Bebout (R) during an intense moment of negotiation on the budget this week.  The senator, who owns an oil drilling company in Riverton, co-chaired the committee charged with drafting a compromise version of Wyoming’s $3.5 billion General Fund budget.

At 9:40 p.m. on Wednesday, Bebout and conference committee co-chair Rep. Steve Harshman (R-Casper) called for a show of hands on the last amendment of the day. The resulting vote tweaked the compensation package for state employees and K-12 teachers.

That concluded eight hours of legislative bedlam that sliced some budgets, added to others, and revised footnotes attached to the budget over the past two months. The legislators saved two topics for further debate: Medicaid expansion, and a final amendment to balance the budget.

“(This) process, it’s all compromise,” Harshman said. “It’s giving some up, keeping some, and splitting some down the middle. So nobody gets everything they want.”

The amendments passed in conference will face a final approval on the House and Senate floors before going to Gov. Matt Mead’s desk for his approval.

“Our floors did all this work, and we come out and sync the action of these 90 independent thinkers, and bring it all together,” Harshman said. “It takes forever. It’s tedious and tough, but in the end, it works.”

Inside the conference room

The conference committee on the budget has a significant amount of power to change the course of Wyoming’s $3.5 billion in General Fund spending over the next biennium. That power is wielded in a different format than typical legislative debates.

To begin with, conference committee amendments are usually made by voice, and the process is rapid-fire without the formal procedural rules enforced in the chambers. Furthermore, the debate is conducted in a small room that has roughly 35 seats for the public.

Unlike normal Joint Appropriations Committee hearings on the budget, this year’s conference committee debate was neither recorded nor streamed live on the internet. That means the only people who know what was said in the conference were seven representatives, five senators, several staff from the Legislative Service Office, and a few dozen audience members including lobbyists, reporters, and members of the public.

The number of people who fully understood what was said is likely even smaller, because the committee made no provision to provide the public with working documents that lay out budget amendments in the order of consideration with summary language. The reason, leaders said, was that summaries aren’t officially approved by amendment drafters, and could be misinterpreted by the public.

Nonetheless, lawmakers relied on the amendment list during the debate, and many reporters and lobbyists acquired the document through unofficial channels. Without the amendment list, the budget debate would sound like a stream of numbers and buzzwords, leaving only a few people with high-level comprehension of the negotiations. In this environment, 12 lawmakers make decisions that have the potential to affect thousands of people across the state for the next two years.

In his opening remarks, Bebout underscored the significance of the committee in crafting a compromise between the House and Senate versions of the budget.

“This is probably the last and most important step to resolve the differences we have, and come up with a bill for the state of Wyoming,” Bebout said. “When we started out it was the governor’s bill. Then it became the JAC’s position. Now as we work this it becomes the House and Senate bill, the conference committee bill, and ultimately, the people’s bill.”

Compensation

In the committee’s final action on Wednesday evening, lawmakers approved a motion involving state and school employee compensation. In simplified terms, the amendments removed funds for paying into the state employee retirement program, but put roughly the same dollars back into salaries.

The resulting amendment gives executive branch and University of Wyoming employees $39 million for salary raises. That equates to about a 2.3 percent raise for state employees in the first year, compounding to a 2.5 percent raise in the second year of the biennium. Employees would pay out-of-pocket for state-mandated increases in employee contributions to the retirement fund going forward. Gov. Mead had previously called for covering increases to employee retirement costs. (See graphic for more details, or read this WyoFile article.)

The elimination of the retirement money came after the House adopted the Senate language on the topic. “As we studied it more, (taking out the retirement money) makes a very small difference to the bottom line in the employees’ pay check,” said Rep. Steve Harshman (R-Casper). “That’s why we decided to concede the House position on that.”

The same compromise put the compensation package for K-12 employees at $38.1 million. For 2015 that would break down to a $9 million External Cost Adjustment to cover things like materials, energy costs, and salaries, while adding another $6 million for salaries only. The same amounts would be sustained in 2016, plus an additional $7 million would be added to the External Cost Adjustment. For K-12 employees, that equates to roughly a 1 percent raise in 2015, compounding to 1.6 percent raise in 2016.

Community college compensation would remain at the 2 percent External Cost Adjustment equal to $3.65 million for 2015 only. That amount was recommended by the Joint Appropriations Committee before the session.

Higher education amendments

The committee passed a motion to provide $7.5 million to community colleges for enrollment growth. The same motion provided $7.5 million to the University of Wyoming in two parts: $5 million for matching grants and $2.5 million for a literacy program. The committee also approved $1 million as a bonus to the university block grant if the school raises its enrollment by 600 students by the year 2016.

Other education amendments:

• Cut in half Adjunct Professor Loan program funding to $165,000.
• Reduced funding for university wifi upgrades to $1.5 million (requires $1 million match from university, total project cost is $2.8 million).
• Required a study to ensure credits transfer from community colleges to University of Wyoming.
• Authorized $4.4 million in local funds to be spent on construction at Western Wyoming Community College.
• Authorized $125,000 to fund positions in the Wyoming Department of Education to coordinate early-childhood programs among four state agencies, and provided $665,000 for grant funding to early childhood programs.

Mirror amendments

In the first motion on Wednesday afternoon, the committee adopted 18 “mirror” amendments that both the Senate and the House passed in identical versions. In that vote, the lawmakers approved $480,000 in additional funding for senior centers, and created a task force to study how to improve science education and facilities at the University of Wyoming, among other topics.

Another significant amendment in this group would distribute $40 million in local government funding according to a formula the benefits counties and cities with high need. Previously, the budget bill would have distributed that money on a per capita basis. The action leaves cities and counties with $175 million in state aid, one of the highest amounts offered to date.

Following the approval of mirror amendments, the committee considered amendments that changed footnote language, but did not contain state appropriations. These included an amendment that removed a 1 percent local match requirement for state air service enhancement funds. Another measure directed the Department of Health to study the impact of independent hospitals.

Rep. Mary Throne (D-Cheyenne) offered an amendment that precluded the Board from adopting the Next Generation Science Standards, but allowed the ongoing review of science standards to continue. The change altered a floor amendment added by Chairman of the House Education Committee Rep. Matt Teeters (R-Lingle) last week, that would have stopped the State Board of Education from reviewing any type of science standards. Throne’s amendment targeted the specific Next Generation standards that became the focus of a nascent controversy over the past year.

Other amendments that passed:

• Provide $600,000 in additional funding for tourism promotion.
• Cut in half Air Service Enhancement funding to $250,000.
• Authorized roughly $300,000 for the Value Added Industrial Plan, including funds for legislative travel to foreign countries.

Medicaid expansion

On Thursday morning the conference committee started debate on a House amendment to allow Gov. Mead  and the Department of Health to begin negotiating with the federal government to expand Medicaid. During afternoon action Sen. Drew Perkins (R-Casper) added language to the Medicaid amendment. His changes require that the state’s share of costs for an expanded Medicaid program be paid out of savings from portions of the Wyoming Department of Health budget that accrue as a result of the expansion. 

Sen. Bebout added language that an optional expansion of Medicaid in Wyoming, “Shall not negatively affect the small businesses and private insurance companies in our state.” In a final change, Bebout altered language to read that Gov. Mead “may” begin negotiations with the federal government on the expansion. Previously the House amendment read that Gov. Mead “shall” begin negotiations.

The passage of the measure by a voice vote marked the furthest progress of any discussion of Medicaid expansion in Wyoming to date. Several floor bills on the topic failed to pass in either chamber. To read more about the Medicaid amendment, click here.

Budget Balancer

In action on Friday the conference committee passed a final amendment to balance the budget. At the beginning of this week, the proposed spending in the House bill would have left a negative balance of $1.7 million.  The Senate position stood at a negative balance of $34.6 million.  (Neither of these figures accounts for savings accounts like the Legislative Stabilization Reserve Account (the “rainy day” fund), which could be drawn on to balance the budget. That account is projected to have a balance of $1.8 billion by 2016.)

The amendment passed Friday gives the budget bill a positive balance of $13 million. That number is subject to change due to further actions being taken today and next week.

The amendment balanced the budget using $15.7 million made available by the failure of House Bill 51—Firemen’s pension plan benefits along with $10 million from the Strategic Investments and Project Balance Account for 2013.  Assuming that the funding in a bill to improve Court Security stays at its current level, the budget will carry a positive balance when it goes to the House and Senate floor next week.

Both chambers will have to concur on the budget before it goes to Gov. Mead. The governor will then have the opportunity to veto sections or line-items in the bill, which the legislature could overturn with a two-thirds vote.

— Gregory Nickerson is the government and policy reporter for WyoFile. He writes the Capitol Beat blog. Contact him at greg@wyofile.com.