Tax money on the line

Alexis Barker
NLJ News Editor
 
Weston County entities could lose more than $900,000 in deferred mineral tax payments thanks to Senate File 60 passed this year by the Wyoming Legislature, according to County Treasurer Susie Overman. 
“These are ballpark, fictitious numbers at this time,” Overman told the News Letter Journal, explaining that the figure is based on previous year’s taxes. 
While the total amount may not be lost, she said, it is important that local government bodies be aware of possible delayed payment of ad valorem taxes because of SF 60. 
Overman brought her concerns to the Weston County commissioners on May 18. 
She told commissioners the that bill allows certain companies up to 12 years to repay the deferred payments to the county. That revenue, she said, funnels down to other entities, including both local school districts. 
According to the Wyoming Legislature website, SF 60 gives mineral producers the ability to make monthly payments of their ad valorem taxes on mineral production. The new system takes effect on Jan. 1, 2022. Not wanting to overwhelm producers with the change from paying their ad valorem taxes annually to monthly, Overman said, legislators included in the bill the ability for these companies to defer tax payments for other years. 
“Production taxes are always a year behind, and this bill is trying to get them even,” she said. 
According to the Wyoming Legislature’s website, the bill specifies that 50% of production from calendar year 2020 and all production in 2021 will be paid at 8% per year starting Dec. 1, 2023, until the outstanding balance is fully paid. 
“Unless the entire tax due for production from calendar year 2020 is paid by Dec. 31, 2021, the remaining 50% of the taxes due for production from calendar year 2020 and all taxes due from production in year 2021 shall be paid as provided in this subsection,” the bill states. “The total amount of 2020 and 2021 remaining taxes due under this subsection shall be calculated by the department and the applicable counties. The taxpayer shall make an additional payment on Dec. 1 of each year beginning in 2023 equal to 8% of the total amount calculated.” 
Recognizing the potential negative impact to entities not receiving anticipated revenue as they’ve been used to, the Legislature provided the state treasurer with $16,726,000 from the stabilization reserve account. This money is to be used for loans to counties and entities facing shortfalls due to the deferred payments. 
“Loans shall be repaid by the county on a schedule determined by the state treasurer consistent with the schedule for payment of remaining taxes under W.S. 39-13-113g at an interest of 0% per annum and the loans shall be guaranteed by the payment of remaining taxes,” the bill says. 
While legislators included an opportunity for counties to access the stabilization reserve account funds, Overman said, she has reservations because of the instability of some of the companies. Producers that go out of business, in effect, leave counties that borrow state money to cover their shortfalls due to deferred payments by the mineral producers no options for repaying their state loans.   
“If they disappear or go bankrupt, we are out that money,” Overman told the commissioners.
According to Overman, two producers that are no longer operational still owe the county tax dollars. Ten other companies also still owe taxes to the county. 
The county can put a tax lien on a business, she said, but that does not guarantee payment.