Investment returns bolster Wyoming revenues

Investment returns bolster Wyoming budget; Gov. Mead says will call for state employee raises

Associated Press
Investment returns bolster Wyoming revenues
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Wyoming Gov. Matt Mead discusses state budget projections at the State Capitol in Cheyenne on Wed., Oct. 23, 2013. Mead says he believes the state should pursue expanding coal exports to Asia. (AP Photo/Ben Neary)

CHEYENNE, Wyo. (AP) -- Wyoming Gov. Matt Mead said Wednesday he plans to ask lawmakers to approve state employee pay raises after a new revenue report showed state receipts running better than $300 million ahead of projections.

The extra investment revenue comes from state funds that total nearly $17 billion and include some permanent savings from taxes on mineral production.

The state's accounting procedures don't account for investment returns until the cash is in hand.

"As we look at the revenue forecast going forward, there's concern about coal being relatively flat. Natural gas not being what we'd like it to be," Mead said. "Oil looks pretty good going forward."

Mead intends to meet with legislative leaders next week to discuss the effect of the forecast on the state's ongoing, two-year $3.2 billion general funds budget and beyond.

He plans to release his next budget proposal in December and said he will likely recommend the state also save some of the windfall and fund capital improvement projects.

Wyoming, the nation's leading coal-producing state, has seen production slip from more than 430 million tons in 2011 to an estimated 385 million tons this year, according to the report from the state's Consensus Revenue Estimating Group.

Coal production has been hit by falling national demand brought about by cheap natural gas and tighter federal emissions standards.

The report also notes that Wyoming hasn't seen any successful federal coal lease sales this year. A scheduled sale in August received no bids. And the U.S. Bureau of Land Management rejected the highest bid it received for a sale in September, saying it was below market value.

Mead this week returned from a trade mission to South Korea and Taiwan where he participated in energy conferences and met with industry and political leaders. He said both countries are anxious to buy Wyoming coal to meet rising energy demands.

"Both countries are so interested in Wyoming coal that had I had coal on my person, I think they would have purchased it right then and there," Mead said. "They want our coal. And they understand what we have to work through in terms of the ports, and the rails."

Mead is pushing the idea of developing new deep-water ports in Oregon, Washington or possibly Canada to handle export of Wyoming coal that could be delivered by train. The proposal has hit resistance in the Northwest, where opponents have expressed concerns about noise, dust and the effect of burning more coal on the atmosphere.

Mead said Wyoming coal has a higher quality than some coal available on the Asian market.

"I think it's appropriate for Wyoming to be a supplier of coal, which is lower-sulfur coal," Mead said. "And at the same time, I think with regard to coal and every energy resource, we have an obligation to try to figure out how to make it cleaner."

Mead believes Wyoming needs to continue research into how to capture emissions from coal-fired plants.

He said he doesn't think it's appropriate for the United States, which uses so much coal for its own electricity, "to say to another country, you're not going to be using coal."

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