Wyoming Gov. Mark Gordon Faces Massive Budget Hole As COVID-19 Cases Rise

Wyoming is facing a projected $1.5 billion revenue shortfall over the next two years due to economic fallout from the coronavirus pandemic.

The state was already facing a massive budget hole as a result of the drop in oil and gas prices that is now being compounded by the pandemic. Republican Gov. Mark Gordon is now contending with major budget cuts as coronavirus cases continue on an upward trend that began in June.

“It really does require that we look carefully at our budget. Roughly half of it is wiped out under the worst scenarios, and I will say the worst scenarios were charted really at the depths of COVID-19,” Gordon says. “But still a third of our revenues are gone, and we're going to be forced with making about a fifth of our budget cuts in the next year.”

Wyoming is not alone among states facing sharp revenue drops as a result of economic shutdowns amid the pandemic. States could face a revenue fall between 18% and 23% due to the shrinking economy, according to financial research firm Moody’s Analytics.

Gordon recently extended the state’s restrictions to limit the virus’s spread after previously expressing hope to soon eliminate them.

“We had hoped that we would be able to remove all those restrictions,” he says. “But because we've seen this spike, because we've seen some careless behavior on the part of some individuals at large gatherings, we needed to just take a moment and take an assessment.”

The state saw an average of 14 confirmed cases per day in June compared to about 10 per day in April, according to the Wyoming Department of Public Health. The rise in cases has so far not corresponded to a rise in hospitalizations.

Despite concerns that rural hospitals in the state could be overrun if cases keep rising, Gordon has yet to pass a statewide mask mandate. Gordon has worn a mask while delivering statements where he has expressed the public health benefits of wearing one.

“Wyoming is a collection of 23 different counties, each with their own particular dynamic. And so in places like Teton ... that was something that was asked for by the businesses there,” he says. “Some other counties are much more rural, and they really haven't seen the rise in cases and they see it differently.”

On what budget cuts will look like 

“It's going to cause pain. There's no question about it. We're seeing everything from rest stops that are going to have to close to significant parts of our health department budget that are going to have to change. And as you know, it's really the purview of the legislature to be able to raise revenues, and Wyoming does not have an income tax. We actually have a constitutional amendment that pretty much prohibits that. We have some of the lowest taxes in the country. All of our revenues have really been dependent on natural resources, and those natural resources have really stood Wyoming well over the last several years. For an average family of four, they pay about $3,000 in taxes and get about $30,000 [in public services].”

On why the state won’t raise taxes and efforts to diversify its economy

“Well, part of the issue is with the oil and gas war between the Saudis and the Russians, it certainly hit very hard the shale producers in the country. And so part of our reduction in those taxes was to keep them viable when the rebound comes. Mobilization, bringing those industries back into Wyoming, it was essential that we had a low competitive tax structure.

“We are working very energetically on that particular front [diversifying the economy]. Wyoming has the most progressive blockchain laws. We have a new digital asset custody banking structure that no other state in the nation has. So we really are trying to diversify, and that's starting to bear some fruit. Already we have what we call our 'speedy banks.' We have about three charters that we're reviewing now, so we are starting to pivot. But I do want to point out that the reason why we're moving from fossil fuels is the advent of renewables, and renewables have a big presence on the landscape. And for Wyoming, that's an issue with our migration corridors. That's an issue with our sage-grouse habitat. And so balancing that was something that we took up in the last legislative session, and I'm proud to say that Wyoming was the first state in the nation to pass a carbon negative standard for all new generations in Wyoming.”

On the state’s spike in coronavirus cases

“We've seen the largest sort of concentration of cases, about 47%, in the last two weeks. So obviously, people in Wyoming, we've suffered relatively less. We're third lowest in the nation for an infection rate. We're also third lowest for unemployment. But people are starting to feel the spring is here, the summer is here. Time to get out. They've been a little careless, and we're really seeing the fruits of that just as other states are. We didn't really do much other than to just press pause. We've been consistently relaxing our orders, allowing groups.”

On if he’s concerned about a possible spike in hospitalizations 

“Rural health care is something that's problematic everywhere. We are concerned about it. Luckily, we do have capacity right now, but it is absolutely essential that people mind their P's and Q's because our resources are limited. We did push hard to have Yellowstone Park open up early, and we made sure that the [Army] Corps of Engineers was available to be able to repurpose hotels if necessary. But as you say, a lot of our health care is really dependent on our surrounding states Utah, Idaho, Montana, South Dakota, Nebraska and Colorado.”

On President Trump’s refusal to wear a mask 

“Well, I think it's terribly unfortunate that wearing a mask has become somehow a partisan issue. I think freedom is the freedom to wear a mask or not wear a mask. I don't appreciate anybody trying to intimidate one person one way or the other. I think it's really about the responsibility with rights and our Constitution comes the responsibility, and in this case, wearing a face covering is absolutely demonstrating your responsibility to the other citizens of this nation.

“Do I wish that President Trump would wear a mask more consistently? Sure. And I think that's an important thing our nation is going to have to contend with. But what I'm saying in Wyoming is gradually people are becoming more aware. It's annoying to have to wear a mask, but I am seeing people that are becoming more conscientious. As you visit stores, more and more of the population is starting to wear a mask.”

On if Wyoming is considering a Medicaid expansion under the Affordable Care Act

“In the case of Wyoming, that's been a perennial topic for some time. The people of Wyoming really haven't felt the need to pass Medicaid expansion yet. And I think for us, the challenge is going to be understanding what the costs are going to be, not this year, not next year, but a few years from now. I do anticipate, as I've said, everything is on the table this year. We've seen clearly the challenge we have with our budget requires that we examine everything with a fair and unjaundiced eye. So I anticipate we'll have a robust conversation about that very topic this year.”

Francesca Paris produced and edited this interview for broadcast with Tinku Ray. Samantha Raphelson adapted it for the web.