Committee guts $135 Million economic development bill in Wyoming
The Senate Appropriations Committee on Wednesday stripped most of the funding from a House bill that would have spent $135 million over 10 years on economic development – leaving a wide gap for the House and Senate to bridge.
What is left of House Bill 264, strongly pushed by House leadership, is one-year funding of $8.4 million to create a "Business Ready Community Account."
The account would be initially infused with $5 million from the General Fund and $3.4 million from a mineral royalty grant program that has not been used.
Gov. Dave Freudenthal has strongly favored spending $15 million per year to help cities and counties with business parks, utility upgrades, roads and other projects aimed at attracting and keeping businesses.
Rep. Randall Luthi, R-Freedom, told the Senate Appropriations Committee the House supports the governor’s concept but believes the state cannot afford the full amount.
The plan would allow the Legislature to help communities attract new companies through Wyoming Business Council grants without additional revenue measures, he said.
"We very much wanted to key off a funding source without raising taxes," Luthi said.
Tucker Fagan, chief executive officer of the Business Council, told the committee the plan is to help communities emulate the success of business parks in Laramie and Cheyenne.
"We bring in power, water, sewer," he said. "We look at where the successes have occurred in the state and we say, ‘How do we replicate that?’ "
Wyoming can beat Colorado, Idaho and Utah at attracting new businesses, but funding is needed to do it, he said, adding the council would be "very scrupulous" with the grants.
Under the House version of HB264, the Business Council would have $7.5 million available for grants beginning in fiscal 2005, $10 million the following year, $12.5 million the year after, and $15 million in each of the final seven years.
Before the Senate committee took action, the measure would have placed $21 million in the Permanent Mineral Trust Fund from a recently discovered account and relied on coal lease bonuses to build up the Business Ready Community Account until interest from the trust fund investment could offset the coal money.
Sen. John Schiffer, R-Kaycee, the committee chairman, voiced concern with the bill’s diversion of coal bonus money, which are funds that coal companies bid to secure leases on federal land. A portion of that money is used to build new schools.
On the net
HB 264 http://legisweb.state.wy.us/2003/introduced/hb0264.pdf
"If you tap the bonus money, you’ve got to make it up from the General Fund sooner or later," Schiffer said. "Every single scheme here results in a diminishment of the Budget Reserve Account or the General Fund."
He also expressed concern that the House version relies on coal bid bonus money that is not guaranteed after 2008.
The committee adopted his amendment stripping reliance on the coal money and $21 million investment in the Mineral Trust Fund, essentially removing the final nine years of funding from the 10-year plan.
Retained was the $8.4 million, allowing the program to be launched by midsummer but allowing the Legislature to come back in 2004 and review the rules that the Wyoming Business Council formulates and consider other funding sources.
Sen. Irene Devin, R-Laramie, expressed concern that the Business Council would be mirroring efforts of the State Loan and Investment Board.
Schiffer successfully offered an amendment that would allow the Business Council to make recommendations to the Loan and Investment Board, which would then make the final decision on grants.
The committee voted 5-0 to recommend the measure for further debate in the Senate.
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