Transportation funding is expected to be a leading topic in the coming weeks at the Wyoming statehouse.
In the lead-up to the start of the 2025 regular session, the Joint Transportation, Highways and Military Affairs Interim Committee voted to introduce legislation to help the state address funding needs.
The Wyoming Department of Transportation reports the agency’s annual shortfall is more than $400 million.
Severance tax revenue
One method being targeted to help address funding concerns is the state’s 1% severance tax. The tax is imposed on the extraction of non-renewable natural resources that include crude oil and natural gas.
Severance tax revenue is deposited into the state’s Permanent Mineral Trust Fund. Half of the revenue goes into the state’s common school account within the permanent land fund.
The fund is ranked as the best-performing sovereign wealth fund in the United States over the past three years, the Wyoming Treasury Department reported.
House Bill 29
The interim transportation committee voted to advance pursuit of a bill, HB29, that would instead put all severance tax revenue into the state’s highway fund.
The switch would result in $316 million going to roads over the next three years, according to a fiscal note.
Rep. Jerry Obermueller, R-Casper, said during a recent hearing to discuss the plan that the change is needed to boost highway funding.
“The health of our families and the economy is dependent on the growth and condition of our highways,” Obermueller told the panel. “We don’t have any money for growth. There are corridors in our state that definitely need growth.”
He added that the common school fund has its own sources of revenue that would sustain that fund.
Dennis Byrne, WYDOT chief financial officer, told lawmakers there have been significant decreases in general fund dollars being made available for transportation, as well as significant increases in inflation.
He added that although the federal government is sending more money to the state, “It’s not enough to address the needs that we have. We need more revenue.”
House Bill 33
Another option endorsed by the committee would rely on vehicle sales tax to boost transportation revenue.
A 4% sales tax collected on vehicles and trailers now is directed to the state’s general fund.
HB33 would instead apply the sales tax to the highway fund. The tax collected on vehicles and trailers would not increase.
“Our position on it is if you’re going to buy a vehicle, you’re probably going to use it on a road,” WDOT Director Darin Westby told lawmakers. “Therefore, some of those taxes should come to help maintain and work on roads.”
The rule change would not apply to sales of agricultural vehicles.
The bills can be considered during the regular session that begins Tuesday, Jan. 14. LL
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