State official: school construction funding has ‘gone away’

CHEYENNE — For years, Wyoming’s school capital construction account was primarily funded by federal coal lease bonus revenues. 
“Those have essentially gone away,” Senior School Finance Analyst Matthew Willmarth with the Legislative Service Office told the Select Committee on School Facilities at an interim meeting in Casper this week. “There is no revenue forecast to be collected from that revenue source.” 
To help make up a portion of Wyoming’s deficit in school funding due to disappearing federal coal lease bonuses, lawmakers in 2018 eliminated an $8 million cap on state mineral royalties that could be appropriated for schools. 
Looking ahead, Laramie County School District No.1 is poised to get some money for its own construction projects. 
The state Constitution allows for one-third of all state mineral royalties to be appropriated for Wyoming schools, but lawmakers enacted an $8 million cap on that allocation in the 1990s. 
The 2021-22 biennium was the first in which a full one-third of state mineral royalties could be deposited into the school capital construction account without that cap, Willmarth said. 
“That allowance of the full one-third to be distributed for school capital construction purposes means there will be about $45 million more this year,” Willmarth said. 
Officials expect $64 million to be collected in the next biennium. But the elimination of the $8 million cap does not entirely solve the funding deficit. 
For the 2023-24 biennium, the Legislature appropriated $245.4 million in state funding to the school capital construction account, with $86.4 million dedicated to capital construction and $159 million for major maintenance. 
“While there is $257.5 million from the school capital construction account, the Legislature had to make up about $65 million in revenue to buttress that account,” Willmarth said. 
Over $45 million of that funding came from the Legislative Stabilization Reserve Account, commonly called the “rainy-day fund.” 
Another $14.6 million came from the state’s strategic investments and projects account, and $4 million, or as much as there is available, came from the school foundation program reserve account.
Nearly $7.5 million worth of funding in the school capital construction account will go to LCSD1. This includes a $5 million allocation “effective immediately” for construction of Cheyenne’s new Coyote Ridge Elementary School, which experienced “inflationary pressure” due to construction costs. 
Construction just began on this new school east of Powderhouse Road, with an anticipated completion date of late in 2023. 
There will likely be a $9 million supplemental budget request coming for major maintenance, also due to inflation costs, Willmarth said. 
The Legislature’s Joint Appropriations Committee is taking up this interim session the concept of streamlining the transfer of funds from mineral royalties to school accounts, but they have not yet gotten to that discussion, Willmarth said. 
Sen. Bill Landen, R-Casper, pointed out that the School Facilities Commission has “moved into asset preservation mode,” rather than new construction. 
Only one-third of the biennium allocation is intended for capital construction, and another two-thirds will be used for major maintenance. 
The school capital construction account “is far more than just building new buildings,” Landen said. “Quite frankly, it is more of a major maintenance and taking care of buildings account.” 
The majority of the appropriations out of the account are related to major maintenance, Willmarth said. 
He added that the account also appropriates funding for operations of the School Facilities Division and department staff for operation of the School Facilities Commission.
 
 
This story was published on June 24, 2022.