System could be tweaked, some say
DAVID MIRHADI Star-Tribune staff writer | Posted: Sunday, March 16, 2008 12:00 am
CHEYENNE - There have been few squawks about the money allocated for local governments this session.
But like everything in life - except possibly a rose - the distribution plan is not perfect.
All told, the cities, towns and counties got $383 million for the coming biennium that begins July 1.
The total includes an additional $43 million allocated to the state Loan and Investment Board for grants to local governments.
The state board includes the governor and the other four elected state officials.
The cities and towns will receive $100 million, or $25 million more than last year.
The sum includes $13.7 million for the two years to make up lost sales tax from the tax exemption on groceries.
The distribution formula is not what the Wyoming Association of Municipalities wanted, "but we will make it work,"' said Mark Harris, the organization's legislative director.
The original WAM plan ignited protests because the formula did not give special money to "hardship" and "impact" communities.
The plan adopted by the Legislature allows $8.2 million to the "revenue challenged" or hardship municipalities and the same amount to nine counties designated as hardship counties.
Harris said the $383 million "is a very good appropriation and will meet the needs of local governments."
"I won't speak for the counties," he added.
"Local governments did well," said Joe Evans, the director of the Wyoming County Commissioners Association.
The problem, he added, is in the distribution formula.
Although the counties picked up $18 million more than last year, they will receive $13 million less in direct distributions.
The counties at the same time will get $33 million more for capital projects, Evans said.
The Legislature wanted the money, labeled as "consensus county block grants," to be used for construction projects, like roads.
But the consensus county block grant dollars are shared with communities within the counties so it isn't solely a county pot of money.
"What happened was we had a formula that all the counties agreed on," Evans said.
The proposal got through the House but the Senate took $22 million of the consensus money and allocated it directly to the municipalities. Which we of course didn't like," Evans said.
"I thought they would do some negotiating in the joint conference committee on the budget but they didn't," he said. "All they did was take the two budgets and split them down the middle."
Gov. Dave Freudenthal, who signed the budget that included the formula and dollars for local governments, said the larger counties in the state got more money because they have more legislators.
He said it is good that the Legislature set aside money for the State Loan and Investment Board to distribute to local governments.
"But we didn't want it to be too big," he said. because the board members want money primarily to be able to deal with unusual circumstances.
The critical piece of information which the Legislature's Select Committee on Local Government Finance is trying to get is the basic cost of running a county, the governor said.
Once that amount is determined it can be held harmless and the rest of the money can be distributed on the basis of population, Freudenthal said.
The select committee is starting the second year of a two year study.
"What everybody struggles with is the baseline. What is it?" the governor said.
The distribution plan adopted by the Legislature allows $8.2 million to the "revenue challenged" or hardship municipalities and the same amount to the nine counties that are designed hardship counties because of their low per capital tax base.
One of the revenue challenged counties is Goshen, which will receive $2 million in hardship money out of its total allocation of $11.6 million in 2009-2010.
"I'm reasonably happy with what the Legislature did," Goshen County Commissioner Ross Newman said Friday.
He said Goshen County was one of the winners in allocation of consensus block grants and will receive $8.6 million for construction out of its total $11.6 million allocation.
Last year the county's block grant was $1.6 million.
"We will end up spending nearly all of the block grant for roads," Newman said.
The county first has to reach a consensus with five incorporated municipalities within its borders.
"We will call a meeting and we will sit down and figure out who gets how much," Newman said.
He said he also is happy to see the food tax exemption "backfill" to make up losses to local governments.The Legislature allocated $12.2 million to the counties for the two years to make up the tax loss.
Goshen County, he said, was a big loser in sales tax revenue last year - down 8.3 percent, which he said could be blamed largely on the food tax exemption.
He said he was not opposed to taking the sales tax off groceries but pointed out that Goshen County is an agricultural county and much of sales to agriculture is tax exempt.