WyoFile by Maggie Mullen
Wyoming lawmakers are considering various ways to ease the burden of rising property taxes on residents.
The Joint Revenue Committee advanced five proposals during its meeting last week in Casper. These include a measure that would change the requirements for a property tax rebate program and another to give the Legislature greater flexibility in granting exemptions to residential properties.
Teton County saw the state’s largest increase in property taxes in 2021 with a 36% increase, according to data from the Department of Revenue. The other 22 Wyoming counties also saw increases at an average of 16.17%. Such spikes are especially difficult for those living on a fixed income, such as retirees and disabled residents. Renters are also vulnerable to property tax increases, as some landlords will pass the increased cost on to them through the rental price.
However, county officials warned lawmakers of unintended financial consequences: Property taxes fund local governments and education in the state.
long term solutions
There are more than a dozen approaches to property tax relief on the table for the Joint Revenue Committee’s consideration, each with a different tax outcome and potential legal challenge. Deadlines also vary; some proposals, for example, would not bring material changes for several years.
The committee began its discussion last week with a bill that would begin the lengthy process of amending Wyoming’s Constitution. There are three classes of property currently outlined in the state constitution: mineral, industrial, and “all other property,” which is a catch-all for residential, agricultural, and commercial properties. Originally sponsored by Mike Yin (D-Jackson), the bill would create a new class of residential property. This would allow legislators to create exemptions for residential properties without losing critical income from agricultural or commercial properties.
“My goal, ultimately, is to ensure that people who have lived in Wyoming their entire lives or for a long period of time don’t end up being thrown out of their homes due to property tax increases,” Yin said of the bill. .
The bill would give the Legislature greater flexibility to pursue measures such as lowering residential assessment levels. Park County Assessor Pat Meyer warned lawmakers not to play around with assessment levels.
“You’re going to hurt poor counties,” Meyer said, adding that it will be hard for those counties to get other revenue.
As with any constitutional amendment, the decision would ultimately be left to the voters. If the bill succeeds in the Legislature, the earliest it will be on the ballot is 2024. The committee voted to move forward with the bill and a tentative plan to amend it to remove other constitutional hurdles.
In a separate effort, the committee discussed commissioning a study to seek to change the state’s property tax system to one based on acquisition value, that is, the purchase price. Right now, property taxes for homes in Wyoming are based on current market value, regardless of what the current owner paid for the property, possibly decades earlier.
Department of Revenue Director Brenda Henson urged the committee to clearly outline the scope of the study, including a definition of “purchase price.” Henson asked the committee if that would include real estate agent fees, for example. A memo from the Department of Revenue included another 30 questions for the committee’s consideration.
The bill to commission the study mirrors failed legislation from the 2022 budget session sponsored by committee members Reps. Chuck Gray (R-Casper) and Mark Jennings (R-Sheridan).
Teton County Assessor Melissa Shinkle spoke in favor of the bill, saying it would be especially helpful if combined with some type of rate cap.
“It may not sound like a relief program, but it will have an effect on those people who are on fixed incomes and have owned their homes for a long time in Wyoming,” Shinkle said.
Lawmakers also moved forward with three pieces of legislation that would provide more convenient relief for homeowners. A bill would change state statute to allow optional monthly payments, instead of residents paying twice a year.
Another bill would modify the state’s property tax refund program, which saw its highest demand yet in 2022, according to Henson. The previous record was in 2015, when some 2,300 residents qualified for the program, costing the state just under $1 million. So far this year, the department has reimbursed 3,075 applicants totaling more than $1.8 million.
The program’s budget for the biennium was $3 million, so “in order to make the program fully available to homeowners over the next year, we’re going to need additional money when it comes to overtime budget,” Henson said.
Sweetwater County Assessor Dave Divis encouraged lawmakers to continue funding the program and raising revenue requirements in lieu of other activities, such as the acquisition-based study.
“That’s not a property tax break. That’s a different way to value property for taxes,” Divis said. “If the Legislature really wants to help people who need property tax relief, I think [the refund program] is the best method because it is already in the statute. There is no constitutional amendment that needs to be passed. It can be managed now and there is no loss of income for anyone.”
Some 1,300 applicants were turned away this year, mainly because their income exceeded the limit. The draft bill would raise those income limits. The committee also amended the bill to require applicants to live in their homes at least six months out of the year.
The committee also voted to sponsor a bill that would exempt up to $50,000 of a home’s value from property taxes, at least for homes worth more than $200,000. Lower-priced homes, on the other hand, would get a 25% exemption under the bill. The legislation outlines other requirements for such an exemption, including limitation to owner-occupied homes that are lived in for at least six months a year. You must also have been a resident of the state for at least five years to qualify.
To address concerns about impacts to the local government budget, committee co-chair Rep. Steve Harshman (R-Casper) introduced a successful amendment to use state funds to reimburse counties for lost revenue due to the waiver. .
“We want to solve this problem, but in the meantime, not create other problems and that’s all I’m trying to do with this filler,” Harshman said.
The next committee meeting will be November 21 in Cheyenne.