Task Force Meeting Information

December 13, 2005

State Capitol, Room 302

Cheyenne, Wyoming

 

Task Force Members Present

Representative Randall Luthi, Chairman

Senator John Schiffer, Vice Chairman

Senator Kit Jennings

Senator Rae Lynn Job

Representative Roy Cohee

Representative Debbie Hammons

Representative Becket Hinckley

 

Legislative Service Office Staff

Dave Gruver, Assistant Director, LSO

Don Richards, Senior Research Analyst

Joy Hill, Associate Research Analyst

 

Others Present at Meeting

Please refer to Appendix 1 to review the Task Force Sign-in Sheet
for a list of other individuals who attended the meeting.

Call To Order

Chairman Luthi called the meeting to order at 6:00 p.m.  The following sections summarize the Task Force proceedings by topic.  Please refer to Appendix 2 to review the Task Force Meeting Agenda.

 

Approval of Minutes

The Task Force approved the minutes from the November 17th meeting, without change.

 

Introductory Remarks

Chairman Luthi provided a short history of the purpose and creation of the Task Force and indicated that much of the discussion planned for this meeting would be educational.

 

Veteran's Exemption and Property Tax Deferral Program

Sharon Garland and Michael Walden-Newman, State Treasurer's Office, provided a background of the deferred property tax program.  Ms. Garland noted that just four loans have been made over the history of the program and three remain outstanding.  The outstanding loans represents deferred taxes of approximately $22,000.  Ms. Garland added that the program is only currently operating in two counties, and no additional loans have been made since February of 1998.  

 

Ms. Garland continued her presentation with a brief discussion of the veteran’s exemption program.  She indicated that the State Treasurer's Office does not have active involvement in the daily operation of the program and contact with applicants.  Rather, the Office of the State Treasurer's primary involvement is in the reimbursement of counties for exempted taxes under the program.  She noted that the Legislature could expect a $200,000 exception budget request for the 2007-08 biennium for county reimbursements within the veteran's exemption program.

 

Mr. Walden-Newman commented, in anticipation of potential questions by the Task Force, that the State Treasurer’s Office could administer a repayment program to counties in the event the Legislature desires to exempt food, utilities, or both from sales tax.  He indicated that such a reimbursement could be administered by the current staff.

 

Tax Refund to Elderly and Disabled

Diana Martin and Bob Peck, Wyoming Department of Health (WDH), provided an overview of the tax refund to the elderly and disabled.  Mr. Peck summarized the income limits for both single and married couples and suggested that the limits have not been amended in 10 to 12 years.  He also noted that the number of applications for the program have been declining.  Further, according to Mr. Peck, most of the unsuccessful applications are denied because they exceed the income guidelines.  Mr. Peck indicated that in FY05, 3,600 applications were processed and, of that, about 3,000 to 3,100 were deemed eligible.  He also provided the Task Force with a statistical summary of the program from FY01 through FY05 as well as an indication of the number of single and married applicants that were deemed ineligible due to income.  (Appendix 3)

 

In response to a Task Force request, Mr. Peck indicated that WDH could provide the Task Force with levels of possible increases for the income limitations and a consideration of the required appropriation to fund the increases.

 

Property Tax Rebate and Lowering the Assessment Rates

Director Ed Schmidt and Wade Hall, Department of Revenue (DOR), provided the Task Force with a summary of the property tax rebate program.  Director Schmidt indicated that about $200,000 of the $4.8 million appropriation has been expended, representing a lower use than anticipated at the time the appropriation was made.  (See Appendix 4 for an illustration of the expenditures for the 2003 and 2004 tax years, by county.)  Mr. Schmidt summarized the eligibility requirements and indicated that the application includes an affidavit.   

 

Mr. Hall walked the Task Force through the handout (Appendix 4) and illustrated that the participation rates by county are quite different.  Mr. Hall suggested that the income requirement, household asset requirement, and residency requirement all come into play.  He stated that while information on any one variable is available - knowing how the three variables interact is considerably more difficult.  Mr. Hall indicated that notification of the program occurs on the tax notice itself, by statute.

 

Responding to questions, Mr. Hall commented that it is up to the Legislature to determine how fine of a filter is appropriate.  He added that some individuals may be intimidated by working with the Department of Revenue for the benefit, rather than a social services agency.  The Department spends about an hour and a half reviewing each application.  He indicated that close to half of the applications require follow-up to obtain additional information.  For example, the front page of the individual's income tax return is required.

 

In terms of changing the statutory criteria, Mr. Hall indicated that the income requirement might be the most limiting, followed by the asset test.  He indicated that he would provide the full Task Force with the county median incomes and stated that the income levels for eligibility are not provided on the tax notice in each county.

 

In response to a Task Force inquiry, Director Schmidt indicated in his opinion, not the Administration's, he would prefer to see the state's money used on infrastructure, given Wyoming's relatively low [residential] property tax burden and recognizing there are many that are less fortunate.

 

Low-Income Energy Assistance (LIEAP)

Paul Yaksic and Terry Williams, Department of Family Services (DFS), provided an overview of the LIEAP program.  Mr. Williams indicated that the program provides assistance to low income households that are below 185 percent of the federal poverty level (FPL) by making payments directly to their utility provider.  Last year, Mr. Williams  indicated that LIEAP served 9,551 households and this year DFS is on track to receive some 14,200 requests, or approximately a 50 percent increase.  Mr. Williams indicated that the criteria for the program includes the number of individuals in the household, gross household income, and heating fuel source.

 

Paul Yaksic discussed the Governor’s budget proposal by stating that DFS has one half of the $750,000 in General Funds available for the biennium, or $375,000, and $5.34 million in federal funds.  He indicated that this will not allow DFS to serve the 14,000 plus anticipated requests.  As of December 9th, the program already received 9,700 applications, of which 6,700 have been approved; 400 have been denied due to income limitations or failure to provide required information; 100 and pending; and 2,500 additional have been received.  Mr. Yaksic reported that DFS is currently about 22 percent ahead of last year's outlay to utility companies. 

 

Mr. Yaksic explained that DFS doubled the $750,000 appropriation for the '05-'06 biennium to $1.5 million for the next biennium.  In addition, DFS and the Governor have requested an immediate supplemental of $5.995 million to address the households previously discussed, stating that if the program has 14,000 households, DFS will run out of money.  Mr. Yaksic explained the application season begins in October and runs through February, and if the funds are used up, the program will close.  This effective immediate request is also doubled to $11.9 million to carry through for the next biennium.

 

Responding to questions about the potential of federal funds being available and what actions can be taken now, Mr. Williams indicated he did not have an immediate answer to that potential and that DFS is on track to have 14,000 applications.   Mr. Williams stated that DFS would work with utility companies to create a temporary understanding to assist the elderly and those families with young children. 

Mr. Yaksic indicated that federal legislation might provide the state with funding based on the per capital distribution. 

 

Responding to a question about the backlog of applications, Mr. Williams indicated that there is currently a backlog of approximately 2,500 applications, though the contractor is working six days a week to process them.  By February 13th, DFS would have a good indication of the magnitude of any projected shortfall, according to Mr. Williams.

 

Representative Hammons asked about the potential of depleting the contract with NOWCAP at the end of February and what it would take to prepare a plan for a worst case scenario.  Mr. Yaksic indicated that DFS estimates it might take $50,000 for the contractor to get through the current season, given the increased applications.  Mr. Williams indicated that DFS would be pleased to prepare a plan.

 

Public Testimony

Rev. Jon Laughlin, Grace United Methodist Church, stated that four families that he is aware of have had their utilities shut off, each owing between $700 and $4,500.  Clients wishing to participate in the energy programs have to gather documents and then either visit or fax several different applications to different locations to apply for each program.  He indicated that the application process is slow, particularly when the potential of having power shut off is impending.  He discussed his recent efforts with the Public Service Commission, Cheyenne Light Fuel and Power and examples of struggling individuals in Cheyenne.  He added that the worst case scenario isn’t happening some day, it is happening right now.

 

John West, private individual, provided testimony regarding his families particular situation.  He indicated that he was injured at work last year, has four kids, and is permanently disabled.  He added that his wife was also disabled.  Despite their disabilities, both of them are working; however, he is unable to make ends meet, since he has a $1,200 house payment, water bills, food, vehicle taxes, and rising utility bills.  He added that several families are similarly situated.  Mr. West indicated that he makes $21 too much for food stamps, and keeping one bill up to date sometimes requires letting others fall behind.

 

Rick Kaysen, Cheyenne Light, Fuel, and Power, provided a background of the Energy Share program in Wyoming.  The program is a private program designed to provide a one-time payment during the heating season.  The program is operated by the Salvation Army with donated funds from utility companies and customer donations. (See Appendix 5 for the application form and background summary.)  Mr. Kaysen commented on provisions already in place that limit utility disconnects if there is a known condition, brought forward by a customer, of medical necessity within the household.  Limits on utility disconnects during certain weather conditions also apply, according to Mr. Kaysen.  In response to potential increased limitations on shut-offs, Mr. Kaysen asked if utilities should bear the burden of the customers' costs for health care, medicine, housing, etc.

 

The Committee then discussed the benefits of challenging businesses and customers to donate to a pool for utility assistance and the ease of making donations to Energy Share. 

 

Dan Noble, Administrator, Department of Revenue, (speaking as a private citizen) encouraged the Task Force to combine the needs testing and qualifying applications into one centralized form and database repository.  The Task Force discussed the benefits of utilizing UW's cooperative extension centers as regional collection vehicles.

 

Directives From Task Force/Discussion of Next Meeting

Chairman Luthi indicated that the Task Force will consider legislation at their next meeting and may consider such topics as a program for utilities, property tax relief, LIEAP changes, and possibly various forms of sales tax relief as well.

 

Senator Schiffer encouraged the Task Force to request the Chairs of the Joint Appropriations Committee to write a letter to the Governor to consider transferring (flexing) existing appropriations among programs or agencies to cover any shortfall in LIEAP prior to any potential appropriation made during the session.  By consensus, the Task Force agreed to forward their concerns to the chairs of the Joint Appropriations Committee. 

 

Senator Job requested LSO Research staff provide information on what a family in Wyoming must earn to get by.

 

Representative Luthi indicated that the Task Force would like meet during the week of January 9th, likely in Cheyenne, and encouraged members to bring proposed legislation forward.

 

Meeting Adjournment

There being no further business, Chairman Luthi adjourned the meeting at 8:00 p.m.

 

Respectfully submitted,

 

 

 

Representative Luthi                                                    

 

 

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