City Council Debates on Quarter-Percent Excise Tax to Fund Gillette College

(Gillette, Wyo.)  Dr. Mark Englert, CEO of Gillette College, asked the city council last night to let the people decide if they want to tax themselves to support the college.

An interested group of community members and other elected officials attended the council work session where Englert proposed a countywide vote on a quarter-percent (.25 percent) economic development excise tax (sales tax) to fund the college and the activities of Energy Capital Economic Development.

Englert requested the issue be placed on the agenda for next week’s city council meeting for further discussion, and for the council to take up a resolution authorizing a special election to be held this November.

In order to hold a special election, a resolution authorizing the election must be passed by the Board of County Commissioners and two-thirds of the municipalities within the county. In Campbell County, with only two municipalities, Gillette and Wright, both municipalities concurrence with placing the question on the ballot is required.

Under normal circumstances, a matter like implementing an excise tax would not be rushed, but time is of the essence in this case, because the college is under enormous strain due to cutbacks at the state level and a decline in BOCHES (Board of Cooperative Higher Education Services) money of nearly $600,000 this current year.

“We’re $900,000 short,” expressed Englert to the council. “We’ve reduced by five positions, we have fifty percent of our faculty in overload situations. We’ve hired forty adjunct faculty in preparation for this next year. We are underserving the community.”

County Commission Chairman Rusty Bell urged the council to decide the matter quickly.

Bell said special elections, like that proposed to impose the excise tax, can only be placed on the ballot three times a year during the months of November, May, and August. The County Commissioners would like to see the motion on the ballot during the special election to be held this November, 2017.

“All of the resolutions from the three entities would have to be filed or passed by the 29th of August to make that time frame possible,” Bell stated.

“Let people decide,” said County Commissioner Mark Christensen. “I often hear ‘Why did you guys build this?’ or ‘What did you do with my money?’ This way we will provide them with the opportunity to decide.”

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The quarter-percent excise tax being discussed would provide the college and Energy Capital Economic Development with a combined $5.2 million a year, based upon last year’s sales tax collections. The college’s share of the collected monies would be budgeted by Gillette College as part of its regular budgeting process.

But Councilman Kevin McGrath questioned the ability of Gillette College to retain the funds, reasoning that the money could potentially be injected into the Northern Wyoming Community College District as a whole, and that this would not be in the community’s best interest.

“Tax dollars stay local,” Englert said. “Those dollars stay local. We serve the local entities. […] Tuition dollars that we raise at the college even though it’s part of the district, stay local.”

Englert all discussed that local money from the BOCHES tax mill collected within Campbell County stays in Campbell County and that the local money collected through a BOCHES mill in Johnson County also stays within Johnson County, who is another part of the Northern Wyoming Community College District.

Englert told the council that Gillette College would like to prepare and retain our community’s local talent and that the only way to do so would be to provide a stable funding mechanism for the college.

Wyoming demographics show that most of the educated talent in Wyoming leave once their education is complete, due to the current low demand for an educated workforce in the state, but that demand could be changing, as elected officials begin to see the value in providing a quality, educated workforce to give the struggling economy much needed diversification.

“If we’re really going to seriously talk about diversifying our economy, you have to invest in education.” Christensen expressed. “We’ve all seen here what happens when you have things retract in the mineral industry.”

The need for an educated workforce is, however, not the main area of concern for the city council.

“My concern is the one percent sales tax,” said Councilman Robin Kuntz. “We cannot survive without that. Without raising water rates 160 percent. We cannot survive without our one percent. How do we consider putting that in jeopardy in any way?”

Kuntz was concerned that any increase in tax would result in the loss of the optional one percent sales tax that generates an estimated $25 million dollars, revenue the council considers to be invaluable to the City of Gillette.

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“If the people are happy with how the optional one percent is being spent, they’ll renew the optional one percent,” Christensen replied. “If they’re not happy with how the optional one percent is being spent, then they won’t renew the optional one percent, regardless of what happens here.”

Christensen also noted that the public has traditionally considered the issues separately, having renewed the optional one percent tax in 2014, even though an additional one percent capital facilities tax was being collected for the Gillette Regional Water Supply Project and improvements to water infrastructure in Wright.

In a follow-up interview, Christensen later said, “The people really look at the different taxes individually. There was a time when the community chose not to renew the optional two percent lodging tax. Even after that, the optional one percent was still renewed two years later. Our citizens look at how each group is spending the money they optionally are given through these measures. Just like the citizens have the opportunity not to continue taxing the optional one percent, they could also elect this November, or if it is passed, at a renewal vote, to also not reauthorize the quarter-cent tax for the College. It all comes down to whether or not people feel their tax dollars are being spent wisely. I’m not advocating for or against the proposal. I’m simply saying it is worth consideration and we should let the voters decide if they want to tax themselves for this purpose.”

Local citizen, previous nursing college director, past Gillette College alumni, and past Campbell County state house representative, Norine Kasperik, also spoke in favor of the excise tax for the college, saying that she and her husband have often discussed, and sometimes disagreed on how to fund the college, but that both of them agreed with this proposal.

Both Christensen and Commissioner Micky Shober also talked about how the proposed excise tax would be paid by all people within the county, as opposed to being paid predominantly by the mineral industry, noting that if a mill (which is assessed as a property tax and on mineral production) were passed and later assessed, the taxes would be paid 70 percent by oil, gas, coal, and other extraction industries. With Christensen noting, that during the good times, the assessed valuation, which mills are calculated upon, was as much as 90 percent paid by industry.

The mill option was one that members of the City Council seemed interested in discussing. However, the Commissioners shared that in order to impose a mill levy for the college, which would also require a vote, you would have to impose a minimum of four mills. Anything under four mills jeopardizes state money which flows to Gillette college and the Commissioners also questioned the need to raise the amount of money four mills would raise, which Christensen estimated at $16.8 million based upon the current year’s assessed valuation.

“If you’re wanting to look at other funding options, start with the one that puts you in the ballpark in terms of amount,” Christensen said in a follow-up interview. “I do not believe the college could justify $16.8 million per year – which means we don’t need to look at the four mill option. The $5.2 million being discussed from the quarter-cent excise tax, after being split between the college and economic development, seems more logical and reasonable.”

The split of the money that would be generated, estimated at $5.2 million per year based upon current sales tax collections, was also discussed, with Commissioners saying they believed the best way to address the split would be to establish an MOU between the county, city, Town of Wright, college, and Energy Capital Economic Development, something they said they believed could easily be accomplished before the potential November vote.

“With the State Legislature looking strongly at adding an additional one percent tax next March to pay for the state government operations or schools, passage of our own one percent sales tax will become difficult enough as it is,” Councilman Dan Barks said. “I just cannot support losing that $25 million to our local economy each year and putting our city’s funding in jeopardy.”

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The motion to place the discussion of the optional quarter-percent excise tax on the agenda for next week’s City Council meeting was narrowly approved with Gillette Mayor Louise Carter-King splitting a tie between councilmembers. Those against the motion were Councilmen: Barks, Kuntz, and McGrath. Those in favor were Councilmen: Tim Carsrud, Shay Lundvall, and Billy Montgomery.

Should the quarter-percent excise tax special election resolution pass during next week’s City Council meeting, it will be optional, just like the one percent sales tax, to be voted on every four years by Campbell County citizens. The Campbell County Commissioners and Wright Town Council would also have to pass similar resolutions by August 29. The council meetings are open to public comment and will be held next Tuesday, August 15, at 7:00 p.m. in the Council Chambers on the first floor of City Hall.

Outliers Creative, LLC, the publisher of County 17, is owned by The MC Family of Companies, LLC, a company owned by Commissioner Mark Christensen.