Wyoming Liberty Group
Today Tuesday the House will hold its second reading of HB75, the Compact for a Balanced Budget bill that proposes a debt-limitation balanced budget amendment to the U.S. Constitution.
Yesterday's first reading included a vigorous debate, demonstrating that this is an issue the members of the House take very seriously. The vote, 35-23, also shows that while the idea of a balanced budget amendment is accepted in principle, there is still some hesitation as to whether or not the Compact is the right way to go.
An early warning signal started blinking back in October 2014 to alert Wyomingites about the effect of falling minerals prices on the state budget. The blinking has now turned into a frenetic flashing. The October revenue shortfall of $4.4 million for the 2015-16 budget now sits at $222 million. As a result, legislators must not only reject new spending that would add to this deficit, they must cut the current budgets of state agencies.
Although many people seem to believe Wyoming’s two-year budget cycle means the off-budget year is a non-budget year, this is not strictly true.
According to the Wyoming Constitution:
The legislature shall meet on odd-numbered years for a general and budget session. The legislature may meet on even-numbered years for budget session.
Gov. Mead’s 2015 supplemental budget request includes raiding $21.2 million from the rainy day fund to build passing lanes on Highway 59 between Douglas and Gillette. He justifies this by saying, “nearly twice as many people died on Wyoming highways in 2014 compared to 2013.”
Dying in a car crash is terrible, but while spending more money on roads will allow the governor to appear to be doing something, it is unlikely to make much of a dent in highway fatalities.
Governor Mead’s supplemental budget presentation outlined the vast amount of money the state has squirrelled away in savings accounts. According to Gov. Mead, “These funds continue to grow and they return investment income to support ongoing operations.” So far so good, as saving to create a fund to generate income to live from is a time-honored form of investment.
Close the downspout
In the Consensus Revenue Estimating Group’s (CREG) October 2014 report, it showed the General Fund and Budget Reserve Account, the two main government spending accounts, would be $4.4 million short of expectations for the 2015-16 biennium.