CHEYENNE — Governor Mark Gordon announced Thursday that Wyoming should expect a decline in economic activity this coming fiscal year and the years to follow.
In a press release earlier Thursday, he said some businesses and mines may have to do layoffs, furloughs, salary reductions, benefit reductions, and consider other options as Wyoming could see revenue losses reaching more than $1 billion.
“We have just experienced the largest loss of income in our history, just four years after our second largest loss of income. But, even if every state employee was let go, or if we closed the prisons, eliminated all money going to the courts, and stopped funding persons with disabilities, we would still run out of funds at the end of the biennium,” Gordon said in the press release.
He furthered this message during his press conference, stating that Wyoming’s economy was looking bleak due to the declining coal industry, which was a concern before the COVID-19 Coronavirus pandemic hit the economy.
“Wyoming depends on energy production to fund its government and has for decades,” the Governor said in the press release. “ But our coal revenues are down 25 percent and will continue to decline. Projected oil revenues have dropped more than 50 percent in three months. Gas is selling for 1970-level prices and there is no new production. Compounding this, sales tax revenues (also largely driven by mineral development) are in steep decline.”
The mission to cut spending is a multi-phased approach, which started in April when Governor Gordon instructed all state agency directors to identify opportunities to immediately reduce spending. The second phase, which is to start July 1, is where the state will begin looking at reductions.
“We are looking at all options because we know we can’t cut our way out of this,” Governor Gordon said.
Governor Gordon said he wants to be direct and transparent with Wyomingites throughout this process.
“Every citizen gets about 10 times the services than what they pay in taxes because of our mineral wealth,” Governor Gordon said. “That means we are going to see declines in our economic activity because we’re going to have to limit our state’s spending.”
After the initial cuts in July, the state will then make plans to reduce even further, isolating priorities. Gordon said the Wyoming residents will be kept in the loop throughout the process.
“Not only will we do the cuts that are necessary, but we’ll tell you what that’s going to mean to your community,” Governor Gordon. “We are in this together.”
He said even if the state used its rainy day funds, that would only last about one year.
“We’ve got to face the facts, and these are tough times,” he said.