Sublette Examiner | Senate File 60, Cloud Education Budget Exemptions

SUBLETTE COUNTY – Two months ago Vern McAdams and Amy Anschutz approached the Sublette County Board of Commissioners concerned about the future of their respective school districts.

McAdams, business and operations manager for Sublette County School District 1, and Anschutz, CFSD 9 chief financial officer, were both invited to speak at a meeting of commissioners on possible ad valorem tax exemptions for Sublette County oil and gas producers. . As representatives of two of the largest tax-funded entities, they were in the vulnerable position of explaining the harsh realities facing county schools.

The two school districts in Sublette County are among Wyoming’s six reconquest districts. These recovery districts are primarily responsible for repaying the remainder of the state’s district funding, as their counties make the most of energy tax revenues – the foundation upon which Wyoming’s funding model was built for decades. generations.

The problem, as McAdams and Anschutz pointed out, is that Sublette County may not have enough funds to close the gap.

The heart of the problem can be traced to the downturn in Wyoming’s energy economy. Long powered by coal, the state’s coal sector has not recovered from the events of 2015. The Blackjewel bankruptcy of 2019, which left Campbell County (not a reconquest district for the first time since over a decade) without millions of dollars in tax revenue, started the conversation between lawmakers to put in place guarantees. The solution, a patch on the leaking inner tube, was Senate File 60.

Despite its intentions, the bill created some confusion. Anschutz told this meeting that the Wyoming Department of Education was struggling to find ways to make the funding model work with the SF 60 in their experience.

At the heart of this bill, the Reclaiming Districts have no idea how to budget. As the number of active platforms in Sublette County began to recover from the bottom a year ago, districts have no way of estimating how much revenue they will receive, let alone how much. ‘they will have to send back to Wyoming. Ministry of Education for redistribution. The bill also created a short-term two-year gap, where income will be virtually non-existent.

“This is perhaps the scariest bill we have faced without massive funding cuts for the simple fact that the adjustment period has the potential to cause us to lose cash in those two years. “, said Anschutz at this meeting of the commissioners. “And bankruptcy could mean that this cash flow is never seen again. “

Anschutz said that when she raised a possible shortage of funds with the state board of education, she was told to “get a loan.”

So what do the numbers look like? In May 2020, the county had a turnover of 67%. In May, the county was at 61 percent. These statistics frightened Anschutz – especially with the impending $ 3.7 million clawback payment owed to the state regardless. She said it was made clear to her that the state expects full payment on its typical schedule, even though it takes more than a decade for producers to make payments based on the schedule established by the SF 60.

In addition, because the bill does not recognize a decline in energy revenues also means a decline in cash reserves, it is possible that SCSD 9 may not be able to meet the payroll of a full staff, Anschutz said. While SCSD 9 does not have the cash reserves that SCSD 1 has, SCSD 1 is required to make a much larger recovery payment.

Of course, there is the registration difference. SCSD 1 has seen an overall increase in enrollment over the past decade, while SCSD 9 has seen steadily decline in numbers. This trend continued in the 2021-2022 budget, where SCSD 9 is expected to experience a decrease of 51 children.

“This is the first time that I have felt like building a budget with a magic eight ball,” Anschutz said.

Anschutz and McAdams agreed that an exemption, at least to cover the two-year gap created by the SF 60 structure, was the best solution for districts. They liked the idea of ​​scheduled payments to cover short-term worries. Both commissioners and representatives of Jonah Energy strongly criticized the solution left at the end of the legislative session.

“If lawmakers wait until the 2022 session to fix this problem,” McAdams said, “it’s too late. We will solve the problem already. Leave him alone then.

McAdams said revisiting the issue in July could be beneficial. Of course, the legislature announced it would not hold a special summer session, leaving the state with no legislative solution for K12 funding or a budget overhaul.

Instead, it’s up to local governments to make the tough decisions to keep the doors open.

Among the Biden administration’s economic stimulus plans in light of the COVID-19 pandemic was the recently announced $ 129 billion that will be allocated to schools across the country. But these funds are limited in their implementation, intended specifically to hire tutors, hire social workers, expand enrichment programs and reduce class sizes – infrastructure funding is excluded, in most places. case.

Commissioners voted to initiate the process of drafting exemption forms at this May 18 meeting, reversing their previous position of following what the legislature created in SF 60. The subject of exemptions was revisited in almost all cases. Commissioners meetings since, leading to nine companies requesting exemptions. The topic will be revisited once again at the July 20 meeting after the board decided to discuss approval of these requests at its July 6 meeting.

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