The Director of the Wyoming Department of Revenue gave an overview of recent residential property tax relief efforts in the state during a legislative committee meeting last month – including details about the impacts of those efforts on Wyoming’s 23 counties.
“Each county is unique,” DOR Director Brenda Henson said during the Joint Revenue Committee meeting last month, explaining that Wyoming has “some counties that are very reliant on minerals and some counties that are very reliant on residential.”
In Fremont County, her presentation showed that residential properties accounted for almost 45 percent of the total assessed property value in 2024 – higher than most other counties in the state.
Those residential property values fluctuate annually, Henson explained, and the extent of the change varies from year to year – but it was more pronounced in 2022 and 2023.
That’s when residential assessed values in Fremont County went up by 12.08 percent and 15.32 percent each year, respectively, after only increasing between .55 percent and 7.55 percent annually between 2014 and 2021, according to a chart Henson shared during her presentation.
Most other counties in the state saw “double-digit increases” to their residential assessed values in 2022 and 2023, too, Henson said, prompting “taxpayers across the state” to reach out to their local legislators and say, “‘Wait a minute, what’s going on?’”
4 percent cap
State lawmakers responded to those constituents by passing several property tax relief measures during the 2024 legislative session, including House Bill 45, which capped annual property tax increases at 4 percent for residential homeowners in Wyoming – unless “the property was acquired the prior year, or if it was new construction, or they added on to that structure,” Henson said.
In Fremont County, that cap exempted $23.5 million from the assessed value of single-family residential structures in 2024, which equated to approximately $1.77 million in exempted property tax dollars, according to Henson’s presentation.
Those exempted taxes will not be “backfilled” with funding from the state, Henson noted, adding that HB 45 doesn’t have a sunset date, either – and next year it will be applied to residential land as well.
Long-term homeowners
The 50 percent property tax exemption for long-term homeowners that the Wyoming Legislature passed this year didn’t come with a funding backfill either, Henson said.
As of this month, Fremont County Assessor Tara Berg said almost 1,800 local residents have applied for that exemption, and she guessed that 200 more applications might come in before the deadline in May.
Based on state calculations of the average property tax bill in Fremont County, Berg said those applications could result in almost $2 million in exemptions affecting all local taxing districts.
“I think the county’s portion was about $400,000,” she told the Fremont County Commission during a legislative roundtable discussion this month. “But then that’s going to include … all those different districts (too).”
The exemption for long-term homeowners is set to expire in 2027, but Berg said some lawmakers want to give counties the option to make it permanent – an idea she expressed “concern” about, especially with the 4 percent cap already in place indefinitely.
“Do we still need (both)?” she asked.
If the 4 percent cap hadn’t been applied this year, Henson’s report says residential assessed property values in Fremont County would have gone up 11.58 percent in 2024, instead of 5.07 percent.
Wyoming Rep. Lloyd Larsen, R-Lander, said those numbers show that the property tax relief measure is “having an impact” – but he added that it’s possible to “overdose” on property tax relief and create “some real problems, because you’re either going to leave your counties and cities without funding, (or) if you backfill it with state general fund dollars, that’s problematic to industries that fund it, and it’s problematic to the general operations of state government.”
Berg replied that “we’re dangerously close to overdosing” on property tax relief in Fremont County, but she also agreed that “we’ve got to be cautious” when asking the legislature to provide backfill funding for property tax relief efforts, because “not one dollar of what we pay” in property taxes “goes to the state,” so the backfill money would have to come “from a place (that) we’re not replenishing.”
“I do support relief for people, but I also understand where that relief comes from,” Berg said. “That funding … can’t keep coming from the state year after year when we’re not replenishing that fund.”
Instead, she said, “what we need to do is look at the taxpayers and say … ‘You tell me what services you don’t want.’”
Commissioner Mike Jones agreed that, “sooner rather than later, we’re going to have to wrestle with which services we can provide” with reduced local revenues – but Commissioner Ron Fabrizius pointed out that the need for those services doesn’t “go away” just because local property taxes are reduced.
“The state, when they pass a tax issue, needs to backfill it so that the counties (can) provide the services … everybody’s depending on,” Fabrizius said.
Commission Chair Larry Allen also expressed hope that the state might backfill some of its property tax relief efforts next year – “because we can’t take much more of this.”
Wyoming Sen. Cale Case, R-Lander, said the lawmakers who supported the unfunded property tax relief efforts this year “didn’t want to hear” about the impacts the measures would have on local governments.
“We tried to bring them in and say, ‘What’s going to happen to local government? What are the implications for this?'” he recalled. “(But) they didn’t want to talk about it. They didn’t want to add backfill to the bills at the time. … It’s too bad, because if they realized how expensive it was, they might not have proposed it in the first place.”
Now that the “price tag” for the bills is more apparent, Case said some of those lawmakers might want to provide backfill funding to local governments to help cover the lost revenues, “but I don’t have any clue as to whether (that) will actually get done.”
He did express confidence, however, that the tax relief bills “will be litigated” – especially “if there’s no backfill” in place.
“Any tax-receiving entity could litigate (them),” Case said. “And it’s not at all clear to me that they will survive litigation.”