CHEYENNE — Wyoming lawmakers will try again to eliminate the state’s Strategic Investments and Projects Account (SIPA) in a continued effort to make the state’s budget process more transparent for the public.
Efforts have been made in past legislative sessions to eliminate Wyoming’s many financial “coffee cans.”
In 2024, lawmakers successfully repealed the School Capital Construction Account and its related accounts. This year, the Legislature successfully eliminated the Budget Reserve Account (BRA) through Senate File 168 and nearly eliminated SIPA through the passage of SF 169.
However, Gov. Mark Gordon line-item vetoed SF 169 and kept SIPA online. The governor maintained his long-term support of simplifying the state’s budget process, but he disapproved of the Legislature’s approach in SF 169.
Gov. Mark Gordon
Gov. Mark Gordon
“(SIPA) was originally a compromise between a previous legislature and the then-serving governor,” Gordon wrote in his veto letter. He served as state treasurer in 2013, when SIPA was first created. “The compromise recognized the value of the governor’s authority to use some of the funds when making budget recommendations.”
Gordon argued the original structure of the bill limited his ability to make budget recommendations.
Currently, excess funds from the state’s Permanent Mineral Trust Fund (PMTF) account are split evenly between SIPA and the state’s main savings account (the Legislative Stabilization Reserve Account, or LSRA).
SF 169 originally eliminated SIPA by July 2026 and transferred all excess funds into the LSRA.
Wyoming statute prohibits the governor from proposing appropriations from LSRA in excess of the 5% statutory reserve account. In other words, he can’t make budget recommendations from this account.
“It is a cagey strategy to undermine a long-standing compromise between the executive and legislative branches and breach the original intent of SIPA,” Gordon wrote.
One effect of Gordon’s veto removed the split of funds flowing into SIPA and LSRA; now, all excess funds go directly into SIPA, effective immediately. He reasoned this action is necessary, as he expects the state will see greater pressure to fund public schools with the passage of more tax cuts and diversions, along with falling oil and natural gas prices.
“The combined effects of these factors create substantial pressure on the general fund to cover any school funding deficit and still meet the ongoing costs of government,” Gordon wrote, “as well as provide services to Wyoming families and businesses.”
Impact of veto
During the Legislature’s Select Committee on Capital Finance meeting on Thursday, lawmakers moved to draft a bill similar to SF 169 and, in a sense, make it “veto-proof.” Sen. Larry Hicks, R-Baggs, who was the primary sponsor of SF 169, said Gordon’s veto “left … quite a dilemma here.”
“The net effect of this line-item veto, if we allow this to stay in statutes the way it currently is, it zeros out the reserve accounts,” Hicks said.
Sen. Larry Hicks, R-Baggs (2025)
Sen. Larry Hicks, R-Baggs
Legislative budget and fiscal staff provided a comparison of the two versions of the bill and their long-term fiscal impacts, based on numbers from the January long-term forecast of the state’s fiscal profile.
The SIPA transfers 45% of what it retains to the School Foundation Program (SFP) account, the state’s main spending account to fund public schools. If the SIPA is entirely repealed, the SFP loses that funding.
Before SF 169 was signed into law, the LSRA and SFP were estimated to receive $124.1 million and $369.4 million, respectively, from SIPA over a six-year forecast period. Under the version passed by the Legislature, LSRA was estimated to receive $191.6 million in that same time period.
The SFP would receive a total of $111.4 million in the first two fiscal years, and then not receive anything starting in fiscal year 2027 with the repeal of SIPA. Under Gordon’s vetoes, the SFP is estimated to receive $470 million over the six-year forecast period, and the LSRA will receive no funding at all.
“But I want to point out that, starting in FY 28 the (PMTF) reserve account can’t guarantee the full amount, and it falls short by about $60 million,” said LSO senior fiscal analyst Polly Scott. “As Sen. Hicks did state … the estimate is that the reserve account is depleted somewhere in (fiscal year 2028).”
Under the version adopted by the Legislature, the reserve account’s life is extended beyond the six-year forecast, Scott added, because the state is relying on it less.
Lawmakers respond
State Treasurer Curt Meier noted that the PMTF reserve account is acting the way the LSRA should act. He suggested removing the 1.25% guarantee from the PMTF reserve account into SIPA so it can “function (as) what it was supposed to do.”
“You’re spending money you don’t have and then you’re trying to catch up … so you can spend it in this year’s legislative session,” Meier said. “Let the reserve account stand on itself, rather than putting more pressure on it than what it can afford to bear.”
Then, the Legislature could move the unrealized capital gains into the LSRA, he said. The LSRA already provides $100 million to the school spending account once it drops below a certain threshold.
Sen. Tara Nethercott, R-Cheyenne (2025)
Sen. Tara Nethercott, R-Cheyenne
Chairwoman Sen. Tara Nethercott, R-Cheyenne, suggested also discussing lifting this cap from the LSRA into the SFP at the committee’s next meeting in September. For now, committee members voted to draft a bill that eliminates the SIPA, with a provision to remove the 1.25% flow guarantee from the PMTF reserve account, and discuss it at the next meeting.
“The elimination of the SIPA account is important, I think, to the Legislature as a whole, in order to simplify and provide transparency to the budget process,” Nethercott said. “Because the SIPA account has been butchered. It’s been tortured … and no longer serves its intended purpose, creating a transparency issue.”