ROCK SPRINGS — The Rock Springs City Council may have approved its preliminary budget earlier this week, but it must figure out how to address a $1.24 million projected shortfall.

The council unanimously approved the $35.8 million General Fund 2021 preliminary budget at its meeting, but that budget also potentially includes a $1.24 million shortfall.

“The preliminary budget isn’t required to be in balance,” said the city’s Director of Administrative Services Matthew L. McBurnett.

And even though the city has about $1.24 million more to cut, it has already cut around $6 million from the budget, according to McBurnett. He said all of the city’s departments have worked hard going over their budgets repeatedly to make cuts wherever they can, from postponing capital and long-term projects set to take place in 2020 and 2021 to forgoing equipment replacements, such as police cars.

McBurnett said departments are also reviewing each vacated position to determine if they really need to refill the position. McBurnett said the city had to cut more this year’s budget than in the past.

“They’re trying not to have layoffs at this point,” McBurnett said.

Rock Springs Mayor Timothy Kaumo already has some ideas about how the city can make even more budget adjustments.

“We will be continually monitoring carryover amounts and adjusting as we near the end of the fiscal year,” Kaumo said. “We may have to consider reducing hours for seasonal employees and we will also take into consideration revenues received by the fiscal year end and may have to dig even deeper in order to balance including not replacing positions that may be vacated at the current time.”

McBurnett said anything the city can spare in 2020 will carry over to help fill the 2021 shortfall.

Why the Shortfall?

“The shortfall has been created by the decrease in sales tax received over the past couple of years,” Kaumo said.

Even prior to the COVID-19 Coronavirus pandemic, the city was seeing a decrease in the amount of sales taxes being generated. The pandemic has only magnified the problem because businesses have been closed, Kaumo said.

However, it doesn’t just stop there. What happens on a national and even global level impacts Sweetwater County. Kaumo said the crash of oil and gas prices, mostly due to the price wars between Saudi Arabia and Russia, have flooded the marker with cheap oil, which decreases the amount of revenue Wyoming receives. When the state receives less funding, so do the counties, cities and towns.

“As that wasn’t enough, we have also lost the sales tax on food several years ago, which was taken away by our legislators with the promise that we would be made whole, this has never been supplemented to date,” Kaumo said.

Kaumo said the cities and towns continue to receive the same amount of funding they have for several years, even though sales-tax revenues continue to decline.

“Based on the last check received by the city, May 2019 to May 2020, the sales tax has declined approximately 31 percent and we are fairly certain the next couple of months will be worse,” Kaumo said.

Changes Needed

“We need more demand for oil and gas and we need businesses back to work providing services to the community and generating sales tax,” Kaumo said.

McBurnett said sales tax is the driving force of the city’s budget and the problem with that is it’s unpredictable. However, Rock Springs needs more than sales tax revenues to increase if it wants to stop the repetitive budget-cutting process.

“We also need our state legislators to find a way to distribute more revenue to cities, towns and counties which are the foundation of our state, especially those rich in mineral development,” Kaumo said.

“The past several years clearly show that the cities, towns and counties are in need of help,” he said. “Our state legislators need to understand this and work to create the tools we could use to generate revenue if we are to continue to receive the same distribution as we have for the last several years. This same distribution formula just simply is not working.”

Kaumo suggested the Legislature pass along the money it recently received from the federal government to the counties, cities and towns. Kaumo said with businesses being closed, cities, towns and counties need the funding now more than ever.

“I believe we can attribute a large portion of our shortfalls and decreased sales tax directly to the COVID-19 epidemic,” he said.

The Council will continue to review the budget and makes changes where needed prior to final approval in June.