What do we need property taxes for? Wyoming is finding out

Property taxes typically go to towns and counties for public services, like fire departments, libraries, ambulances and roads. They’re just one of those things homeowners have to pay — or at least that is how it has always been.

At least 18 states are looking at reducing or even eliminating property taxes. Wyoming has already reduced its residential property tax and public services are on the chopping block.

To understand where this started, we have to rewind to the COVID-19 pandemic. Like many places, home values skyrocketed in Wyoming’s little mountain towns.

“People were coming in from out of state, and they were paying cash offers, they were paying over asking price, and so that just made the market go up,” said Hank Hoversland, executive director of the Wyoming Taxpayers Association.

With home values up, property taxes followed. Hoversland said that meant longtime Wyoming homeowners were suddenly paying a lot more. State lawmakers responded by lowering residential property taxes last year by 25%. It saved a Wyoming homeowner a few hundred bucks, but cost towns and counties tens of millions in revenue.

“There really isn't a plan to make up these revenues. And so it's going to come on the backs of spending cuts,” Hoversland said.

Like the library in the small town of Lander, Wyoming, where Anita Marple is the director. On the day I speak with her, she is wearing a Dr. Seuss T-Shirt that says, “Oh the places you’ll go when you…read.”

“Sometimes I just wear this shirt to remind me of, okay, here's our mission,” Marple said.

Lately, Marple is spending much of her time going over a difficult budget. Because these days, the library’s doors are locked and the lights are out more often.

“You're here on a Monday morning and we're closed until 1 p.m.,” she said.

They used to open at 10 a.m. on Mondays. They have trimmed hours on other days too and got rid of three part-time positions.

“It's all about staffing and having the ability to have people here to serve the public,” Marple said.

The library lost about $300,000 in local residential property tax revenue last year. Similar cuts were seen all across the state.

Jerimiah Rieman, executive director of the Wyoming County Commissioners Association, said one rural county cut its emergency management budget in half.

“Then we saw wildfires in their community, which is an unfortunate element of all of this,” he said.

Another fire district cut overtime and briefly shut down a fire station. Another county is looking to their roads to save money.

“In other words, just shutting those roads down, or maybe paved roads are going to go back to gravel,” Rieman said. “Simply because they don't have the resources to care for those.”

And more cuts could be coming. This fall, Wyoming voters will get a say if they want an even bigger break on residential property taxes through a ballot initiative. Plus, lawmakers are discussing eliminating property taxes all together.

“I also think one of the things that we're not seeing come up in the conversation is, if not property tax, then what? What is it that you propose that we use to fund these services?,” Rieman said.

It won’t be income tax, because Wyoming does not have one. Some say raising sales tax is the answer. It currently averages about 5.5% across the state.

But for now, public services will have to make do with less — something Hank Hoversland with the Wyoming Taxpayers Association does not advise.

“I think other places are looking to Wyoming and saying, can they do it? We have proven that we can't do it,” he said.

At least not without pain.

At Lander’s library Anita Marple was finishing our tour, when she spotted a couple of people giving the locked library doors a tug.

“And we're closed,” she said. “And it breaks my heart when I feel like we ought to be open and we can't be.”

It will still be a few more hours before the library will turn on the lights, unlock the doors and people can check out books, use the wifi and hang out.