Without Coal Lease Bonus Money, State Seeks New School Construction Revenue

Dec 19, 2014

School construction in Rawlins, Wyoming.
Credit Aaron Schrank/WPR

The state agency responsible for building and maintaining Wyoming’s K-12 schools will face huge revenue shortfalls in the years ahead. That’s according to a report by University of Wyoming economists.

The vast majority of school construction funding comes from coal lease bonus payments—and those revenues are expected to dry up completely in 2017.

The School Facilities Department expects to spend half as much in 2019 and 2020 as its spending now—as the state shifts from building schools to maintaining them. But in the same period, the associated revenues are expected to drop by 95 percent.

The UW report found that the state needs to come up with just under $700 million between 2017 and 2022 to make up for the revenue losses. Rob Godby at UW’s Center for Energy Economics and Public Policy worked on the report. He says the end of coal lease bonuses isn’t cause for panic.

“The sky is not falling,” says Godby. “Coal lease bonuses were kind of icing on the cake. They were big sources of revenue but they come and they go. We just have to figure out how we’re going to pay for things because the old revenue streams that we used for that are no longer there.”

Godby says the state has a number of revenue options—including investments, severance taxes and a mill levy, but his team didn’t advocate any one option. Instead, they simply present the revenue picture to help lawmakers make an informed policy decision.

There is a slight revenue surplus expected for the next two years, thanks to the last of the coal lease bonus money.