Cheyenne Mayor Outlines Budget Situation For New Fiscal Year

Cheyenne Mayor Patrick Collins says the city faces a decline in sales and property tax revenues as work continues on a budget for the Fiscal Year that starts in July.

Those are two of the three leading revenue sources for the city.

But the city is seeing increases in electricity franchise fees and money from building permits. The increase in franchise fees are significant because they are the second leading source of city revenues at 11.8 percent.

Collins says the decision by the legislature to cut property taxes by 25 percent will cost the city about $1.7 million in revenues as the city council works on a budget for the upming fiscal year.

The City Council is working on a budget for Fiscal Year 2026, which begins on July 1, 2025.

Property Tax Bill Was A Compromise In The Legislature

Lawmakers passed the property tax cut as  compromise measure between the Wyoming House and Senate.

Both legislative bodies had passed bills calling for a 50 percent cut for two years. But the big issue was backfill, or reimbursement, for local governments for lost revenues. Property tax revenues do not go to the state, but directly to local governments. While the original version of Senate File 69 included a 50 percent backfill, the was taken out of the bill by a Senate amendment. Opponents of backfill argued that including it would essentially be transferring the burden for those funds to a different revenue source rather than a true tax cut. One Senator called the idea of backfill "socialism."

The House put the back fill back into their version of the bill. Backfill supporters argued that the loss of revenues would create too much of a hardship for local governments and especially for special districts.

The final version of the bill cuts the property tax exemption in half, with the tradeoff being a 50 percent reduction in the funding hit taken by local governments.

In his mayoral minute column on Friday, the mayor offered these comments on the budget process as it currently stands.

Mayor Says Increases In Public Safety Staffing May Have To Wait

"Our General Fund has grown by 3.8% from our last budget. The biggest impact on our budget revenues is the 25% reduction in residential property taxes approved by the Legislature. This action reduced our revenues by $1,775,000. During the past four years, the city has grown by 4,637 acres or 18.24%. New business parks creating primary jobs and housing subdivisions account for the majority of the growth. I am concerned that our plan to add the needed public safety staffing to account for the additional 7.25 sq miles will have to be postponed.''

Besides the cut in property taxes, the mayor says sales tax revenues  are down by 3.45, mostly driven by a decline in oil and gas industry activity in the county.

Sales taxes are the top revenue source for the city, generating just over a third of money going into city coffers. Property taxes are the third biggest revenue source at 11.6 percent.

But on the bright side, revenues from franchise fees on electricity are up by a whopping 48 percent. That's due to increased energy consumption by data centers. Meanwhile, building permit fees are up by almost a third at 31 precent.

The council is scheduled to consider a budget ordinance on May 21.