Coalition calls for more clarity on property tax ballot initiative

CHEYENNE — A coalition is demanding more transparency regarding the true revenue impact of the upcoming tax ballot initiative after conflicting numbers were presented at a recent legislative meeting, showcasing a $32 million discrepancy.

Secretary of State Chuck Gray, who is responsible for the language on the ballot initiative, acknowledges that there are different figures, but he maintains that the language was crafted according to state statute.

The coalition, Vote NO on Initiative #1, is concerned that the lower costs presented on the ballot language could misinform voters. It will be up to the people of Wyoming to decide on a constitutional amendment to exempt 50% of the assessed value of a qualifying primary residence from property taxation.

At the Wyoming Legislature’s Joint Appropriations Committee meeting in early June, the Wyoming Department of Revenue presented figures from its independent analysis that the financial impact of the measure could result in a loss as high as $124.7 million in fiscal year 2028 in revenue for state and local services.

In the ballot language, that figure is $92.6 million in fiscal year 2028, the year that, if passed, the change would take effect. 

The reason for the difference is primarily that WDR’s figures include local and state funding lost, while the ballot language only represents potential impacts to state programs, like education funding.

A call for clarity

The coalition, which includes the Wyoming Voter Network and the Wyoming Taxpayers Association, argues that the current ballot language is deceptive. It contends that voters, who will be effectively acting as state legislators when they cast their ballots, are being denied the full financial picture typically afforded to lawmakers during legislative sessions.

The coalition detailed these concerns in a letter sent to Gray, specifically seeking to uncover how the Secretary of State’s Office arrived at its lower estimate. Under the Wyoming Constitution, the state is obligated to fund essential services like education, regardless of property tax revenue fluctuations.

“I don’t think we have the full answers of, quite frankly, what the fiscal impact of the ballot initiative is,” Hank Hoversland, executive director of the Wyoming Taxpayers Association, told the Wyoming Tribune Eagle.

Hoversland noted that legislative fiscal notes usually inform lawmakers of increased expenditures requiring a backfill of revenue losses, particularly for the School Foundation Program.

“We think [voters] should have all the information that legislators are afforded when they vote on issues and bills on the floor of the House or the Senate,” he added.

The $32 million discrepancy

The primary point of contention is the gap between the secretary of state’s $92.6 million estimate and WDR’s $124.7 million figure. Gray has defended the lower number, stating that Wyoming law specifically limits ballot estimates to impacts on the state only, excluding local governments or political subdivisions.

“Our office has and will continue to work diligently to comply with the laws and procedures pertaining to the initiative process. We will also evaluate the false representations and insinuations made in this letter,” Gray wrote in a text message to the WTE.

WDR’s analysis includes local entities, which are the primary beneficiaries of property taxes, including libraries, fire districts and local governments. 

Bret Fanning, the director of WDR, clarified that his agency’s figure reflects the total systemic impact.

“If the statute says it’s really just state funding [required to be on the ballot], then I’m not sure that [local funding impacts] needs to be on that ballot,” Fanning said. “I think the secretary has a really valid point on the language as it relates to the fiscal note on that ballot. But I know other groups are saying, ‘Hey, there’s a lot of other money outside of the state that some folks should really be aware of.’” 

Another reason for the discrepancy is that Gray is using numbers that began to be calculated in 2023, when the initiative was first proposed. 

Under state statute, the fiscal impact process for statewide initiatives must take place prior to the circulation of petitions. Gray said there is no mechanism under Wyoming law for estimates to be revised after that point.

Despite the confusion, Fanning said the DOR and the secretary of state have not collaborated on the figures recently, noting their last substantial contact on this matter was in 2023.

Other demands

The coalition’s concerns extend beyond just the revenue figures. Its demand letter points to a “penalty for false claims” mentioned on the ballot, which fails to specify that homeowners could face up to two years in prison and a $2,000 fine for filing inaccurate exemption applications.

The ballot initiative also states that “no more than one exemption shall apply to a single property.”

This has raised alarms that passing the initiative might cause homeowners to lose other established benefits, such as the veteran’s exemption, the property tax refund program or the recently passed 25% exemption, as well as create confusion.

Jerry Obermueller, a retired CPA and former state representative now serving as the coalition’s treasurer, warned that these omissions prevent an informed vote.

“Voters should understand if and how this ballot measure will impact their home resale values, neighborhood schools, roads, emergency services, and law enforcement,” Obermueller wrote in a news release.

The ballot initiative proposes to exempt 50% of the assessed value of a primary residence from taxation, provided the owner has lived in the state for a year and occupies the home for at least six months annually. If passed, WDR estimates that public schools alone could stand to lose roughly $81.3 million.

Gray has dismissed the coalition’s claims as containing “multiple false representations,” asserting that the fiscal impact estimate was prepared in consultation with the Attorney General’s Office and was finalized before the petition began circulating in 2023. He maintains there is “no legal mechanism” to revise the estimate now.

“We’re at a pivotal moment,” Hoversland said. He pointed out that when revenue drops, the Legislature is obligated to make it up somewhere. 

“Is it going to be a new tax? Is it going to be an increased tax on industry or people? I think that’s important for voters to know and understand when they go to the ballot box in November,” he said.

For now, Fanning said WDR is still working to continue to estimate the most up-to-date comprehensive fiscal impact of the ballot initiative.

While 36 citizen-proposed ballot initiatives have been introduced in Wyoming since 1968, only three have successfully become law.

The general election is Nov. 3.