Statewide lodging tax condemned by Senate

CHEYENNE – The Senate killed a bill to implement a statewide lodging tax on a final vote Monday after it was pulled from the consent list.

It was just one of several bills aimed at broadening and diversifying the state’s revenue stream that failed to make it through the Legislature after a lot of talk to start the session about this being the year for change.

House Bill 66 died 19-7 in the Senate after it had passed out of the House earlier this session on a 44-16 vote. The bill would have put a 5 percent statewide tax on lodging sales, with 3 percent heading to the state’s coffers to help fund the Wyoming Office of Tourism.

The other 2 percent would have gone back to the locality in which it was generated. The state estimated the tax would raise about $19.5 million starting in 2021 and completely fund statewide tourism operations.

Sens. Liisa Anselmi-Dalton, D-Rock Springs, and Cale Case, R-Lander, both recused themselves from the vote because of conflicts of interest with their personal businesses. But Senate rules allowed them to speak on the bill without voting, and they have both been strongly against HB 66 throughout the process.

Anselmi-Dalton said during debates on the bill that while proponents of the tax said it would overwhelmingly affect out-of-state residents, in reality, HB 66 would hit Wyoming-ites who tried to travel across the state.

Sen. Bill Landen, R-Casper, initially voted for the bill, but changed his vote after it became apparent there wasn’t nearly enough support for HB 66 to pass the body. He was joined by Sens. Affie Ellis, R-Cheyenne; Fred Baldwin, R-Kemmerer; and Jeff Wasserburger, R-Gillette, in switching votes.

Landen said he was disappointed the work done during the interim session to help broaden the state’s tax base and lessen the financial burden on the state’s general fund failed to gain any traction.

“I’m mystified by the vote today and was prepared to support it,” Landen said. “I’m not sure why [it failed]. I thought it would receive better support.”

HB 66 was one of several bills that failed this year that were designed to broaden the state’s revenue streams beyond the fossil fuels industry, something leadership in both chambers championed to start the session.

But bills to raise cigarette taxes, index fuel taxes to the Consumer Price Index and raise property taxes to fund education all failed to gain any traction.

Landen said it was imperative the state find a way to become less reliant on the mineral extraction industry to fund operations, especially education.

“I think we all know we’ve got to tackle the tax structure. We have to look at revenue in Wyoming. Our extractive industries simply cannot carry the load they have in the past,” Landen said. “It always comes down to, ‘if not now, when?’ And so far, at least, it hasn’t been ‘when.’

“We have to have that conversation and continue to work on what may be an answer to our revenue difficulties.”

A major effort that failed this year was House Bill 220, sponsored by Rep. Jerry Obermueller, R-Casper, which would have imposed a 7 percent tax on profits for certain restaurants, retail and hospitality businesses in Wyoming to help fund education. It was estimated the tax could potentially generate $45 million annually, although that figure was a rough estimate.

The tax would apply to businesses with 100 shareholders or more, and only on the profits generated from sales in Wyoming. It also includes a dollar-for-dollar tax credit for those companies on any sales and property tax they pay in Wyoming.

The Senate Corporations, Elections and Political Subdivisions Committee, which Landen chairs, laid over HB 220 last week. Landen said at the time he stopped the process on the bill because there wasn’t enough support in the Senate for it to pass.

Throughout this past week, and even going into Monday, there were efforts to bring HB 220 out onto the Senate floor. But despite lobbying by supporters, there never developed enough backing for the bill to ensure its ability to pass.

As of the end of the day Monday, while it was possible the Senate could move on the bill and expedite it through the process before the end of the session Wednesday, it appeared HB 220 was dead in the water.

But the topic of how to strengthen and diversify the state’s revenue won’t be going away. During a meeting of the Joint Revenue Committee on Monday, it was decided a major topic of study during the interim session will be creating bills to help tackle the issue in a future session.