By Hannah Shields
Wyoming Tribune Eagle
Via- Wyoming News Exchange
CHEYENNE — Wyoming lawmakers voted Tuesday to draft a bill that abolishes the state’s property tax system.
During a meeting of the Legislature’s Joint Revenue Committee in Gillette, the proposal was introduced by Sen. Bob Ide, R-Casper, who said it’s time for lawmakers to start over from scratch. Taxpayers are “paying unrealized gains” on inflation, he said, and it’s time for the state to “shift to a new system.”
Furthermore, recent property tax reform passed in the last two years has created complexity in assessment for both the taxpayer and county assessors, he said.
Ide moved to have Legislative Service Office staff draft a bill that would repeal the property tax structure under Article 15 of the Wyoming Constitution, and to consider replacing it with a sales tax. In order to amend the state Constitution, the proposal would need to pass both legislative chambers with a majority two-thirds vote and be signed by the governor.
Then, it would be put on the ballot in the next general election and need the support from a majority of voters.
“A sales tax is the only way we’re going to muck out all of this layered minutiae of property taxes,” Ide said. “It’s really the only fair way to go. At least you have a choice on a consumption tax.”
The multiple forms of property tax relief passed in recent years by the Legislature has created turmoil and confusion for both county assessors and taxpayers, according to experts. Crook County Assessor Dan Thomas, who spoke on behalf of the Wyoming County Assessors Association, there’s a lack of clarity in how recently passed tax exemptions are presented on the notice of valuation.
“In order to understand changes on their tax liability, a taxpayer would need to compare multiple years of assessments to interpret the ever-evolving structure of exemptions,” Thomas said. “This complexity is ongoing, and is only growing as additional policies are layered on.”
As a result, county assessors are seeing more misapplications, missed deadlines and rising frustration from both taxpayers and the county offices trying to work with them.
“We are not here to preserve any specific system,” Thomas said. “Our role is to help ensure that whatever system the Legislature chooses stays aligned with the core principles of a sound tax structure.”
Ide’s motion passed the committee on a vote of 11-3, with Sens. Stephan Pappas, R-Cheyenne; Cale Case, R-Lander; and Rep. Liz Storer, D-Jackson, voting against it. Case said replacing the property tax with a sales tax would create a “distributional problem.”
“You’d have the same questions about fairness, because of the unequal location of where commerce occurs across our state,” Case said. “Property taxes have … got their wrinkles, but we actually have done a pretty good job of implementing them. And, frankly, Wyoming’s taxes aren’t that excessive.”
Case said sales taxes will “hit poor people harder.” He urged his colleagues to study the potential impacts of replacing property taxes with a consumption tax, instead of rushing into another piece of legislation.
Storer told the Wyoming Tribune Eagle in a text message that eliminating the state’s property tax structure would cost the state $2 billion annually in lost property tax revenue.
“We’re talking about $2 billion a year that we’re going to try to make up the difference,” Storer said during Tuesday’s meeting. “We’re only collecting about $1.4 billion in sales and use tax, currently. … We at least would be, probably, doubling our sales tax.”
Wyoming collected $2.057 billion in property tax revenue in the 2024 fiscal year, and half of that was generated through mineral production, according to the Legislative Service Office. Property taxes are the largest source of tax revenue for the state, and make up nearly half of the state’s total tax revenue.
Sales, use and lodging taxes is the second- largest source of tax income, and make up around a third of Wyoming’s total tax revenue.
However, some committee members who voted in favor of Ide’s motion said their intent is not to get rid of property tax, but rather open it up for “new reform.” Co-chairman Sen. Troy McKeown, R-Gillette, said “it puts the onus back on the Legislature.”
“It doesn’t necessarily mean we’re going to get rid of property tax and come up with 6% sales tax,” McKeown said. “It’s just a way to examine this for some true reform.”
Other motions
Cheyenne Republican Rep. Ann Lucas made a successful motion to remove the sunset date on the long-term homeowner tax exemption, which went into effect at the beginning of this year.
Last year, the Legislature passed a property tax exemption for homeowners who are at least 65 years old and have paid property taxes in Wyoming for the last 25 years. Qualified homeowners will receive a 50% tax exemption on the assessed value of their primary residential property.
Around 32,000 applications have been received by county assessors across the state for this tax exemption, according to Wyoming Department of Revenue Property Tax Division Administrator Ken Guille.
He said there are no available estimates on the average value of these applications, but he will have this information for the committee’s next meeting in August.
Rep. Gary Brown, R-Cheyenne, also made a motion to remove the eight-month residency owner-occupied requirement for the 25% homeowner tax exemption. This tax exemption was made available to all Wyoming homeowners through the passage of Senate File 69 in the recent legislative session.
SF 69 provides a 25% property tax exemption on the first $1 million of a single- family home’s fair market value and does not have a sunset date. The exemption takes effect immediately for all residential structures, and then will only apply to owner- occupied residential properties beginning in the second year.
However, Brown’s motion removes the owner-occupied requirement. Storer, who voted against all three motions, said this gives a bigger tax break to people who own a second home.
She noted that homeowners in Teton County — Wyoming’s wealthiest county, which pays the largest portion of state property tax revenue — are getting the biggest tax breaks from these exemptions. According to LSO, Teton County currently represents 39% of total property tax exemptions.
“Essentially, we’re giving tax breaks to people who don’t need them, as a result of then taking away tax breaks for people who do,” Storer said. “This proposal goes in … the wrong direction of helping people that we don’t need to help.”
Supporters of Brown’s motion, however, said they disagreed with the current definition of “owner-occupied.” Co-chairman Rep. Tony Locke, R-Casper, said the eight-month requirement could disqualify homeowners who primarily live in Wyoming, but travel throughout the year.
“At this point, I don’t think we have it properly defined,” Locke said.
Both Brown’s and Lucas’ motions passed the committee on a vote of 11-3, with Case, Pappas and Storer voting against them.
Hurting counties
A legislative staff analysis of data from the Department of Revenue estimated that the 25% homeowner tax exemption will cost Wyoming an estimated $113 million in the 2026 fiscal year. Around $70.9 million of the loss will impact K-12 funding and $42.1 million will impact counties, municipalities and special districts.
In fiscal year 2027, the estimated loss is $47.6 million to K-12 schools and $28.3 million to local governments and special districts because the owner-occupied requirement kicks in. In FY 2028, K-12 schools are projected to lose $57.5 million in funding, and local governments and special districts will lose a combined $34.1 million as many of those who had received the long-term homeowners tax exemption (currently set to end July 1, 2027) apply for the 25% exemption.
Weston County Commissioner Ed Wagoner told lawmakers his county will lose $220,000 off the assessed value of collected mills from tax breaks.
“We don’t have $220,000 in our budget to cut,” Wagoner said. “That’s really gonna hurt.”
In addition, special districts in Weston County will lose $338,000, and several of those entities have no way of generating revenue, he said.
The county has a $4 million reserve, and “that’s all we have.” Around 70% of the county is privately owned, and most of it is agricultural land, which pays 4.2% of the county’s property tax, he said.
“We’re still trying to wrap our hands around this year’s budget right now,” Wagoner said. “Frankly, it scares me if we get that much more taken away from us.”
