CHEYENNE, Wyo. — Wyoming won’t be able to implement further budget cuts, if necessary, without laying off state employees, the governor said Tuesday.
Falling energy revenues prompted Gov. Matt Mead to warn state department directors earlier this month to brace for the possibility of more cuts when the Legislature convenes next year.
The warning came after Mead trimmed roughly $250 million — about 8 percent — from the $3 billion state general fund budget that lawmakers approved for the two-year funding cycle that started in July.
Those cuts, although substantial, were at the low end of a shortfall of as much as $500 million that state analysts warned could occur amid low energy prices and falling coal production that’s hammering state revenues.
Speaking Tuesday at a news conference in Cheyenne, Mead said he doesn’t expect good news when the state’s Consensus Revenue Estimating Group issues its next report in October.
“I don’t think it’s going to be glowing,” Mead said, noting that he will make his budget recommendations to lawmakers based on the report and a scheduled update in early January.
He said he won’t implement budget cuts on his own or call for a special legislative session before the Legislature convenes in general session on Jan. 10.
If more budget cuts are necessary, Mead said he doesn’t believe state agencies can avoid layoffs. Only a handful of state workers were lost in the earlier round of cuts.
In addition, Mead said revenue for the fiscal year that ended June 30 will likely fall about $150 million short of estimates. The state must make up that shortfall before funding the current budget.
Meanwhile, consultants have estimated it will cost the state about $80 million to fix structural problems at the state prison in Rawlins, which is only about 15 years old.
The consultants concluded the facility wasn’t built according to design and that shifting soil is lifting floor slabs and causing cracks to walls and structural damage.
A taskforce of state lawmakers and others is preparing a report evaluating options for the existing prison or possibly building a new facility north of Rawlins at an estimated price of up to $150 million.
“I’m very reluctant to spend $80 million repairing a prison that probably should not have been built in that place in the first instance,” Mead said.
Depending on the outcome of the presidential election, Mead said he may ask lawmakers once again to consider accepting federal funds to expand the Medicaid program under the federal Affordable Care Act. Mead expects the program to end if Republican nominee Donald Trump is elected.
The heavily Republican Wyoming Legislature has repeatedly voted to reject federal money to expand Medicaid to offer health insurance coverage to some 20,000 uninsured working adults in the state. Many lawmakers have said they don’t trust federal promises to continue funding the program if they allow more people onto its rolls.
Mead’s administration had estimated that approving the expansion would have saved the state over $30 million in the current two-year budget cycle by reducing demand for other health services.
“It would have been a huge boost to our economy to have that money that would flow to Wyoming come in right now, versus us saying, ‘we don’t want to do that, send it to Colorado or California,'” he said.