File name: JACSupplementalBudget2011-2012_20110113_073708.dcr
Folder: C:\Documents and Settings\HAppropriations\Desktop\Recordings
3 ~ 1/13/2011 7:59:16 AM ~ Governor Mead - Overview of State Supplemental Budget
34 ~ 1/13/2011 7:59:46 AM ~ Nicholas and Berger : Welcome to the Governor
46 ~ 1/13/2011 7:59:58 AM ~ NIcholas: Welcome. This is our first chance to meet with you. Look forward to working with you...letter?
1:22 ~ 1/13/2011 8:00:34 AM ~ Governor: We delivered a packet this morning. It should have a letter, a spreadsheet and an updated capcom. If there is additional information needed we would provide that.
1:59 ~ 1/13/2011 8:01:11 AM ~ NIcholas: Since the letter has narritive..most of us have not had a chance to read..what we are calling Gov letter number 5. As a practical matter, what happens when we begin the markup process, the governor's recommendation is the standing vote...so we have to sort out the governor's rec ..so your change will become the governor's rec..a couple of areas as we go through your letter..for example when we get to the 61,00 for school capcon we may go through that.
3:58 ~ 1/13/2011 8:03:10 AM ~ Governor Mead: Thank you...appreciate the opportunity..to present some of my ideas...I will not rehash my state of the state..cowboy code of ehtics...talk less, say more...I had that in mind..did not seem to work out..I did try to cover the things that may be different or controversial. We have been on the job for less than 2 weeks..We are not up to full staffing..I apologize for the lateness of letter 5. We included a spreasdsheet that I had prepared for me to work off..that it would be helpful for you..Shelly Nichols is here. I confess I do not have the expertise in budgeting that you have...I have others sitting behind me. It is most important for me to be accurate. I have invited my staff to make corrections. I ask permission for that... What I would like to do is hit the high points and the differences in previous letters..Governor Freudenthals' Pay for state employees: My rec is less..I recommend 6.1 million for approx 3800 employees ..earning less than 90% of market pay...We can continue to look at employee pay in the future. Performance awards: Evaluations are done on a hit or miss basis..even the ones done are not providing a meaningful way..I support 3.1 million for performance awards..only if there is a viable system in place and only to provide bonuses for exceptional employees. The difference in mine is not only the money but only exceptional employees School Construction:
9:28 ~ 1/13/2011 8:08:41 AM ~ NIcholas: I want to be able for us to make sure we are following you in a method. I am looking at the spreadsheet..designated governor 6 then you have got a new spreadsheet that says fiscal profile which is in the original spiral binder...we will ask our questions upon completion of your presentation.. ..new profile sheet reduces that to...that would be in the profile sheet so keep your notes on the profile sheet. Each time you hit an item we will pause...make sure numbers are rogjt
11:43 ~ 1/13/2011 8:10:55 AM ~ Governore Mead... Shelly: I believe the governor was working through some ...our intent was to go through this worksheet to show you changes...that is the process.
12:21 ~ 1/13/2011 8:11:33 AM ~ Nicholas: We will have you do the highlights..keep the notes on questions you want to ask then will go through the spreadsheet..
12:44 ~ 1/13/2011 8:11:56 AM ~ Governor Mead: School Construction: My thought on the 61 million is that before we agree to that we need some work on preference law and contractor law here in Wyoming. I would tell you that I am interested in seeing what improvements...before we spend that kind of money..We have opportunity to make improvements in how we are spending that money...best bang for buck..also in spreadsheet
14:20 ~ 1/13/2011 8:13:32 AM ~ Nicholas: Issue there..have you eliminated the 61 million or put it somewhere or half way in between
14:44 ~ 1/13/2011 8:13:56 AM ~ Governor:..spreadsheet..that has been taken off ..
15:07 ~ 1/13/2011 8:14:19 AM ~ Governor: Funding for Mega Data Centers I am very hopeful that Wyoming can make some good moves regarding Mega Data Centers...I think building some of these we will get the benfits ..and will be a magnet for other centers...pay good salaries..with right infrastructure can build a center not matched in ..have asked for 14.5 million...That would go to the governor's office so we can work with the Wyo Business Council...I am trying to do my job in recruiting .. Funding for local government and highways...I have talked about this many times..in summary, I am looking for a way we can provide funding for local governments..more than just a one-time dollar amount. I believe that local govts when faced with one time funds...long-term plannign is not used as well..not as cost effective...deferred maintenance costs more ..one third of that would go back into LSRA.. There is great disagreement on this issue among you. I would ask for an alternative...provide not just this year but a predictable funding stream in the future
19:36 ~ 1/13/2011 8:18:48 AM ~ Governor: Local funding... For the local govts, rather than the 50/50 split, I think the split should be 75% for projects and 25% for operations...I do not want most of that to be going to hire employees so that when the money runs out, people would have to be laid off. A lot of projects looked at today can be done more cheaply today ..costs have come down...Example: JOhnson County .I would also ask ...that some of the one-third goes back into savings.. Point is money will go somewhere...if you put it all into saving...market may go up or down..there is some stability in having it in a road or bridge instead of the market.
22:33 ~ 1/13/2011 8:21:46 AM ~ Governor: General comments then through the spreadsheet Bottom line : I cut 22.7 m,illion in general expenditures, ...in school constr.....school capital construction fund...trying to express a difference
23:52 ~ 1/13/2011 8:23:04 AM ~ Governor: Spreadsheet Governor Mead General Fund Changes Community Colleges/UW salary..my concern about funding this amount is I have not seen any information that gives me confidence that we have valid comparables...same holds true for UW..have not seen the data for where we are..not comfortable funding the 12.3 million Item 2 $437576 for maintenance on rock well building ..better to maintain for now then put up for sale
25:59 ~ 1/13/2011 8:25:11 AM ~ NIcholas: New building or old
26:06 ~ 1/13/2011 8:25:19 AM ~ Governor: New building Item 3: $10 million
26:45 ~ 1/13/2011 8:25:57 AM ~ Nicholas: Reduction of 10 million talking about
27:00 ~ 1/13/2011 8:26:12 AM ~ Governor: INcludes money for increased insurance premiums
27:12 ~ 1/13/2011 8:26:24 AM ~ Nicholas: tie in : all community colleges came off, ..three componentsL insuracne, bonus and salary adjustments?
27:58 ~ 1/13/2011 8:27:10 AM ~ Governor: Yes,
28:09 ~ 1/13/2011 8:27:21 AM ~ Governor: page 2 of the spreadsheet DEQ:
28:31 ~ 1/13/2011 8:27:43 AM ~ Nicholas: 1.5
28:38 ~ 1/13/2011 8:27:50 AM ~ Governor: recommendation..we have backlogs within DEQ..rough number given...5 years is too long..who knows about new laws and regulations..interested in doing it in a shorter time period...I also appreciate that we do not want to punish Wyoming companies or miss opportunities..trnasfers from other agencies and $1.5 million to hire outside ...to find out if we can get the backlog ..want plan from DEQ..regular reports from how they are doing with the backlog..genesis of the $1.5 million..not asked for by Govenor Freudenthal
31:42 ~ 1/13/2011 8:30:54 AM ~ NIcholas: One time or ongoing
31:54 ~ 1/13/2011 8:31:06 AM ~ Gove: one time
31:58 ~ 1/13/2011 8:31:10 AM ~ Nicholas: one time for governo'r office...transfers
32:27 ~ 1/13/2011 8:31:39 AM ~ Gov:..
32:32 ~ 1/13/2011 8:31:44 AM ~ Nicholas...have already done that..number your page..
33:19 ~ 1/13/2011 8:32:31 AM ~ Governor: it is the wy dot
33:43 ~ 1/13/2011 8:32:55 AM ~ Nicholas: page 4 It is the 1.9 for air service enhancement and we are recommending to fully fund the agencyu's request..I feel that improved air enhancement is critical for Wyoming's future..plan in place for providing funding to see if we can improve..and if sustainable..not there yet. ..funding this gives additional time and oportunity
35:03 ~ 1/13/2011 8:34:15 AM ~ NicholasL dinner with ..?
35:11 ~ 1/13/2011 8:34:24 AM ~ Berger: I want to make sure we will spend more time on this issue
35:29 ~ 1/13/2011 8:34:42 AM ~ NIcholas: will go through this and then back category by category...
35:48 ~ 1/13/2011 8:35:00 AM ~ Governor: LIvestock board: We have 361,185 to improve computer equipment for the livestock board..important board is updated..digital format..records more easily available for producers or issue for health.. UW page 7 Greater Western Wyoming Alliance: reduce 3.6 in half to 1.8 next item is 3.5 million - proposal to spend 50 million for the STEM. Concern is that the 50 million is not a precise amount..thought money should be set aside for ongoing operations..taken 3.5 million out of the 50 million for operations
38:32 ~ 1/13/2011 8:37:44 AM ~ NIcholas: corrections 1.2
38:40 ~ 1/13/2011 8:37:52 AM ~ Governor: 1.2 million women's prison in Lusk 1.2 million to begin project..I think we should wait and see what the design is before funding...parent/child facilitiy in Lusk Summary at bottom: 52 million plus with regard to my changes
39:46 ~ 1/13/2011 8:38:58 AM ~ Nicholas: amounts based upon existing CREG or the new CREG
40:00 ~ 1/13/2011 8:39:12 AM ~ Shelly: not include 41.7 million....
40:11 ~ 1/13/2011 8:39:24 AM ~ fNIcholas: any money incrase belongs to us...
40:23 ~ 1/13/2011 8:39:35 AM ~ Nicholas: respect to the CREG...Bill, go over the new sheets...do not need to interrupt the Governor
40:55 ~ 1/13/2011 8:40:08 AM ~ Bill: I would encourage the committee to wait before considering the school foundation account..some numbers not taken into accoutnt
41:38 ~ 1/13/2011 8:40:50 AM ~ Nicholas: will use new numbers before mark-up
41:53 ~ 1/13/2011 8:41:05 AM ~ Governor..covers the changes from when you last heard from Governor Freudenthal's office I have made a recommendation to appoint Tom Forslund to head the Department of Health..Department is facing challenges..21 million ...25 million previously set aside int he auditor's office..increased medicaid cost...I agree with 25 million in reserve fund..hope better job forecasting ..My belief is that with the changing rules regarding medicaid that things can be in a state of flux..
44:21 ~ 1/13/2011 8:43:33 AM ~ NIcholas: We can bring the Governor back during our lunch time.
44:46 ~ 1/13/2011 8:43:58 AM ~ NIcholas: take a break..when do you need to be gone by..
45:02 ~ 1/13/2011 8:44:14 AM ~ Governor: Meeting veterans in rotunda...nothing at lunch
45:19 ~ 1/13/2011 8:44:31 AM ~ NIcholas: Veterans' temporary time 9:30..stretch your leg...break..5 minutes...
45:57 ~ 1/13/2011 8:49:44 AM ~ NicholasLets get started. Lets try this format. I will address each of the changes in the governor's recs. I'll ask my questions to the end. We will go to 9:30 Have you come back at 12:30 9:30 we will go over the CREG report. We will try to get to you by 2:00 GOv. Fredenthal wanted There were salary adjjustments as per the HAY study. You have a 3.1 bonus adjustment.
49:27 ~ 1/13/2011 8:53:14 AM ~ Gov. Mead. Gov. Fredenthal was 94% mine was 90%
50:07 ~ 1/13/2011 8:53:54 AM ~ Mead One
50:15 ~ 1/13/2011 8:54:03 AM ~ Shelly
50:20 ~ 1/13/2011 8:54:08 AM ~ Nicholas Why don't you introduce.
50:43 ~ 1/13/2011 8:54:30 AM ~ Mead Tony CHief of Staff, Chriss Boswell, Terri Grey Chief of Staff,
51:45 ~ 1/13/2011 8:55:32 AM ~ Nicholas It was not appropriate to extrapolate salaries First are you committed to the Hay Study?
52:26 ~ 1/13/2011 8:56:13 AM ~ Mead I will tell you that my sense is that it is not the perfect system. My other concern is it is a bit of a one way street. In good times we need to increase, but bad times we don't decrease salaries. I does compare public employees to the private sector.
54:31 ~ 1/13/2011 8:58:18 AM ~ Nicholas The 6.1 was compared As a practical matter, then the 6.1 would have to be used. It is important that you look at the narrative that Fredenthal proposed. If you tweak the budgut, it cancels the agreements that we have agreed to. When A&I comes up....... When you take about the 3.1, I'm not sure we have the information we need to approve it.
57:17 ~ 1/13/2011 9:01:05 AM ~ Mead I will ask Mr. Bosswell to look at the atreement so that we are not in
58:00 ~ 1/13/2011 9:01:47 AM ~ Nicholas We assume that the approved money will be spent in the way that we approved it for. If new directors want to change the spending of that money, they will need to come back with a supplemental budget. Be sure to engage A&I in any salary changes. One of the positions had a physician in it and was paid accordingly. The replacement may not be a physician and therefore not going to be paid the same as the previous physicaian "director".
1:01:59 ~ 1/13/2011 9:05:47 AM ~ Mead That was a mistake on my part
1:02:17 ~ 1/13/2011 9:06:04 AM ~ Nicholas THe 6.1 Is a portion suppose to include non-judges salaries There is two aspects to the judicary who are not judges. The legislative branch we treat differently. Are we giving ...... Wheater we want The second issue is if we are giving raises to the directors, should we be giving raises to the judges.
1:04:47 ~ 1/13/2011 9:08:34 AM ~ Meier I was heartned with your remark that the Hay study was a two street.. Because the Hay study isn't a two way street, I think we need to pull over and wait for the private sector catches up.
1:06:39 ~ 1/13/2011 9:10:26 AM ~ Nicholas If you are competing with oil companies for engineers during a boom time, you will have to pay more. If that is the case.... If we go with your thinking of pulling over to the side of the road
1:08:22 ~ 1/13/2011 9:12:09 AM ~ Mead I'm trying to use Mr. Bosswell in any capacity I can to get us through this session One is instead of completly pulling over to the side of the road, the 90% represents a slow down compared to the 94% that was previously recommended.
1:10:50 ~ 1/13/2011 9:14:38 AM ~ Harshman Part of the work that we put..... WHo is going to be the point person.
1:11:27 ~ 1/13/2011 9:15:15 AM ~ Mead They feel more comfortable with an established program.
1:12:05 ~ 1/13/2011 9:15:53 AM ~ Nicholas School Cap.
1:12:15 ~ 1/13/2011 9:16:02 AM ~ Mead
1:12:19 ~ 1/13/2011 9:16:07 AM ~ SHelly Late in the process who are funded with school funding. The $72,000 will be included.
1:13:11 ~ 1/13/2011 9:16:58 AM ~ Nicholas Before we jump to do that, make sure we have all the updates at one time. You have the school program foundation Just coordiante with Budget and LSO School Construction The Select Committee made recommenation. With respect with the construction deivery systems. THe issures are different for State A&I On Friday, We met with about 50 contractors and I will get the notes of that meeting out to you. We don't have time to get to all the issues. We will get all those directors in here. There are a couple of things we could do. We could ....... We could require more fine tuning for a future contracting. We are trying to dissteel through that .. Our expectations are that we can do these things. We should not tie construction to education. One , not spend it, three, In addition
1:19:47 ~ 1/13/2011 9:23:35 AM ~ Von Flatern We have tied funding to such and such bill. I think if we tie this to a bill, it will influence
1:20:52 ~ 1/13/2011 9:24:40 AM ~ Nicholas Out of state CMR's So we have new delivery systems.
1:21:36 ~ 1/13/2011 9:25:23 AM ~ Hastert. This is some of the things that I have worked on during the interium. Everyone has the ame shots to get bids on this work. We have been building the system with loopholes. THe agency does have the abaility but not the manpower to inforce them.
1:23:18 ~ 1/13/2011 9:27:05 AM ~ Nicholas Typically we would ask The object is what the level of comfort that the comittee is in. With respect to UW, I have already ask the president the UW to investigate. Have them meet with the facility people maintainance and facility managers. It's taking about 20 mininutes per topic WE want to develope a relationship with you. I didn't rea;ize Rich was over there. JAC will
1:29:48 ~ 1/13/2011 9:39:02 AM ~ Bill: Explanation of CREG Report,,new meeting
1:30:05 ~ 1/13/2011 9:39:19 AM ~ Bill: Will refer to both documents..Net Effects..Goldenrod page 1..expected amount to transfer to the LSRA ..automatic transfer language currently in the budget bill..look at the number to the left..22.7 millino higher than in Oct...net effect of 2011, 2012 changes to the budget reserve account..added money into sales and use tax estimates ...Oil and gas commission checked into ..seismic work has generated a ton of employment...that explains the additional economic activity in Laramie Count ywhich does not jive with the rig count.. Out of 110 permits granted ...only 10 completed wells..slow process..Bottom line added 17.4 million to sales and use taxes, added $5.3 million..actual revenue in bank..net is 22.7 to General Fund and Budget Reserve
1:34:07 ~ 1/13/2011 9:43:21 AM ~ Harshaman: Natural gas prices have gone up
1:34:42 ~ 1/13/2011 9:43:56 AM ~ Bill; .......those futures prices are about the same...really been an unusual year..storage is really high through the summer..gas prices have held and is still holding..
1:35:15 ~ 1/13/2011 9:44:29 AM ~ Harshamn: Is storage coming down?
1:35:26 ~ 1/13/2011 9:44:40 AM ~ Bill: Storage has come down....5 year avg is being adjusted now..whole trend is going up..strange situation..price wise we decided to leave it the same
1:35:55 ~ 1/13/2011 9:45:10 AM ~ Harshman: Coal..flooding in Australia..affecting prices on coal?
1:36:12 ~ 1/13/2011 9:45:26 AM ~ Bill: Coal is mostly domestic market...There are plans underway to ship coal to china..discount right now
1:36:40 ~ 1/13/2011 9:45:54 AM ~ Nicholas: caution people about gas prices...avg price of $3.90..higher winter volumes and prices in the $5 range...lower prices in the summer..blended out at $3.90.....that was already built in.
1:37:46 ~ 1/13/2011 9:47:00 AM ~ Bill:..correct..some risk that hangs out there yet Pipelines have been used for storage the last couple of summers...market looks stable from up above...just seems that things have changed dramatically in the last few years..
1:38:43 ~ 1/13/2011 9:47:57 AM ~ Meier: Switching to oil...if NIobrara comes on..problems with differential..capacity will be a problem...discussion, data that is out there?
1:39:35 ~ 1/13/2011 9:48:49 AM ~ Bill: The Niobrara play is something we talked quite a bit about. The big problem is that there is not any data. They have yet to hit a well like that in Wyoming. It is all just a guess at this point. What was discussed at the CREG meeting to acquire mineral rights...this play is a lot different: 1. Fractured land ownership - mostly deeded land, very little federal land involved 2. deep stuff requires big rigs with a lot of pipe..10,000 feet of pipe to be pulled...takes rigs like in ND..expensive to move and to set up..that is why there is so much seismic activity. Well in Colorado was very well researched well. $2 million per day to run these rigs... Not economies of scale as in Western Wyoming 3. Take away capacity..no pipeline ..will have to truck out. If you figure 30% increase in oil produced now..it still pales in comparision to the price of a dollar in natural gas
1:44:16 ~ 1/13/2011 9:53:30 AM ~ Nicholas: pg 6..green handout..Most of this is private land so will not see FMR on the Niobrara play... On crude oil, increase 10% state wide, our severance taxes are $16 million. ...10% increase on entire state production is pretty ambitious...
1:45:29 ~ 1/13/2011 9:54:43 AM ~ Bill: Senator Meier, impact in your county would be enormous..in a state wide revenue projection 250 million per year..oil not source for that.
1:46:34 ~ 1/13/2011 9:55:48 AM ~ NIcholas: Finish this up tomorrow Bill..need to know the Goldenrod back and forth
1:46:53 ~ 1/13/2011 9:56:07 AM ~ Hastert: On General fund budget reserve balance..93 million..none of these numbers are reflective of Gov. Mead
1:47:18 ~ 1/13/2011 9:56:32 AM ~ Nicholas: only profiles CREG
1:47:26 ~ 1/13/2011 9:56:40 AM ~ Bill: reflects June 30, 2012...number on front page is preflow.
1:47:55 ~ 1/13/2011 9:57:09 AM ~ NIcholas: Adjourned, back at 12:30.