Wyoming State of the State Address 2011
By Stateline Staff
CHEYENNE, Wyo. - Jan. 12 - Following is the prepared text of Gov. Matt Mead (R) 2011 state of the state address:
Mr. President, Mr. Speaker, members of the 61st Wyoming Legislature, fellow elected officials, Chief Justice and members of the judiciary, and to you, the citizens of Wyoming, including those in our schools and our troops abroad who may be tuning in today by means of various media. Good morning. Today for the first time we have live Internet video feed. Connectivity is important to our state, including the opportunity for our citizens to see our legislative process at work.
The opening prayer, I thought, was an appropriate reflection upon which to begin these proceedings. It was a fitting and lovely prayer. This week I asked that our flags be flown at half staff. Our thoughts and prayers go out today to all the victims of the tragic shootings in Tucson, Arizona last weekend. There is no place for such violence in our democracy. It was a despicable act. I ask for a moment of silence for the victims and their families.
Sworn in last week as our State's 32nd Governor, I have the privilege this week of delivering my first State of the State address. This is a commencement - the start of a process. More important are the actions that will follow it, for I plan to move forward with the platform I campaigned on last year. At the heart of that platform are the following priorities: jobs and the economy, connectivity, infrastructure, assisting cities, towns, and counties, streamlining government, education, dealing with federal issues on matters vitally important to our state. I'll talk about each of these areas today because they will be the focus of my efforts.
Before I begin my remarks, there are a few preliminaries. I want to thank Governor Freudenthal and his staff for working with me and my staff to bring about a smooth transition. These efforts paid off and the transition occurred without a hitch. Thank you Governor Freudenthal and Judge Freudenthal for your eight years of service. I also want to thank the legislature, my fellow elected officials - Max Maxfield, Cynthia Cloud, Joe Meyer and Cindy Hill, and the people in their offices, and all who have extended courtesy and cooperation this past week. I appreciate the welcoming gestures. I want to congratulate again the 24 new legislators who won election and have taken up their places for the first time in these chambers. New members bring many good things with them, including fresh constituent views and new ideas.
There are some people that I want to recognize. Eastern Shoshone Business Council member Willie Noseep, Northern Arapaho Business Councilmen Jim Shakespeare and Lydell Whiteplume are here today. I worked with the Tribal Business Councils often when I was U.S. Attorney and I now greet you in a different capacity, as Wyoming's Governor. Welcome. Major General Ed Wright, the Adjutant General of the Wyoming National Guard, is in the gallery today. General Wright has had a long, distinguished military career. He has served as Adjutant General since 2003. General Wright's entire tenure, as the Adjutant General, was served in wartime. It included more than 20 Wyoming National Guard deployments which involved more than 4,500 soldiers and airmen. Additionally, during his term, Camp Guernsey has become a state-of-the-art facility, training roughly 900,000 military from around the state, country and world. He will be retiring in March and we recognize him today for his distinguished service to our state and our country.
Also in the gallery today is Lt. Colonel Bruce Rowe, 187th Airlift Wing Commander. Lt. Colonel Rowe led 200 personnel on the most recent Wyoming Air National Guard deployment to Afghanistan. Those Airmen returned home in December. He has deployed six times since September 11, 2001. Major Dane Rodgers, C Company, 5th Battalion, 159th General Support Aviation Regiment, is also in the gallery. He is the deployed unit commander for the "Charlie Med", our medivac helicopter unit, the most deployed unit in the Wyoming Army National Guard. Major Rodgers and the Army National Guard soldiers under his command will leave for a one-year mission to Afghanistan tomorrow. This will be his 4th deployment. I look forward to the day I can welcome him and his unit home again. I want to recognize and thank all Guard members for their service. It means so much to our state and our country. I want to specifically mention our appreciation to the military personnel serving far away from their homes. Words don't do justice to the sacrifice you are making. The sacrifice of the brave men and women of the military and their families allows us to be safe, and we are grateful. They support us, and we send our thanks today and every day. Please join me in applauding the fine men and women who are serving or who have served in our Nation's Armed Forces.
I want to recognize the achievements of our fine teachers and students from around the state. One teacher from each of the state's 48 school districts receives a Teacher of the Year award and from that group a panel of parents, teachers and legislators selects the statewide Teacher of the Year. We have with us the teacher selected last fall to receive this year's award. Please welcome Laurie Graves. Laurie teaches 3rd grade at Big Horn Elementary School, and she is the 2011 Wyoming Teacher of the Year. Laurie, you represent all the fine teachers we have in Wyoming, and I thank you for being here and for your excellence in the classroom. We have a couple of our outstanding students with us. James Wilson is an award-winning pianist from the UW Lab School in Laramie. James won his Division of the Asian-American Music Society's 2010 International Competition and performed at the Kennedy Center in Washington, D.C. in December. Taylor Ballek is Wyoming's spelling bee champion for 2010. She is from Clear Creek Middle School in Buffalo. She represented Wyoming in the National Spelling Bee last spring. You both represent all the many accomplished students attending school in
Wyoming. We are proud of you both and expect more great things from you in the future.
Mark and Susan Kupke are here from Lusk. Kerry Majhanovich is here from Pinedale.They are representatives of those honored in the 20 people under 40 program in 2010. These are business and community leaders. These are the enterprising individuals who are blazing trails into the future. When you look at people of distinction in Wyoming - and those mentioned today represent a few of many such people - we recognize the state of the state is very good. Wyoming's future is in capable hands.
Beyond the people-quotient, taking a look at the big picture, I will make a few general observations here. While some states face significant budget shortfalls, our state does not. The latest CREG information projects approximately $279 million available to the General Fund/Budget Reserve Account due to higher energy prices, sales tax and improving employment. Some states have lost population for one reason or another. We have not. We have seen a population growth just slightly over 14 percent over the last decade. The nation as a whole continues to face high unemployment. We do not. Wyoming started 2010 with an unemployment rate over 7 percent, but the latest reports for November indicate an unemployment rate that has dropped to 6.6 percent. Wyoming's rate is well under the national rate which has hovered in the mid-9 percent range or higher for some time. On top of this we have great leaders, abundant resources - energy, wildlife, open space, agriculture, and recreation - all of them world-class assets. We are the envy of other states, yet there remains much to be done in order to secure a better future because when the nation remains under an economic cloud, the cloud moves our way. With more than 6 out of every 100 of our workers out of jobs, we need to create more opportunities because for those not working the unemployment rate feels like 100 percent.
With our revenues tied largely to energy, we need to diversify our economic base and promote economic growth in general. With our communities still feeling the effects of the economic downturn, we need to provide an additional source of revenue to our cities, towns and counties. It is good that we do not face a repeat of last year's fiscal austerity - with 10 percent budget cuts and revenue shortfalls that affected everyone in the chain - from the state on down. It is good that we have an unexpected amount of money for a supplemental budget. But, the last few years have provided a wake-up call. We need responsible growth, growth that's right for the times and our needs, growth that does not compromise our values.
This is a conservative state government, and we recognize that a relatively small shift in commodity prices can have a dramatic effect on our revenues. We should remain conservative, even after the good news of this week's CREG revenue adjustments which provide us with an additional $22.7 million in revenues this biennium. Because this is a general session, only limited supplemental budget recommendations are before you. Governor Freudenthal proffered his supplemental budget recommendations in December. I concur with many but not all of them. I will discuss some of my budget proposals in today's remarks. I will also appear before the Joint Appropriations
Committee tomorrow for further discussion of the supplemental budget.
Let me start by saying I support the additional $52 million in funding for highways and $52 million in funding for local governments (most of which should go to capital construction). That extra money this year will make reasonable progress toward addressing our infrastructure and local needs. I address this in further detail later in these remarks. Although less than requested in Governor Freudenthal's recommendations, I do recommend $6.1 million to bring those state employees earning less than 90 percent of market pay to that level. I consider this investment in our state workforce appropriate and necessary. We appreciate the work of state employees and want to give due recognition for it.
Down the road we should continue to reevaluate our economic picture and continue efforts to reach market pay for state employees, based on regularly updated and accurate data. I support $3.1 million in supplemental funding for performance awards, only if there is a viable system for recognizing excellent performance by state employees. We should not reward "average;" we should reward excellence.
We should reward success and, in order for that to happen, the evaluation process has to be meaningful. I mean to make it so. I am asking agency heads to sign a commitment letter, when they accept their positions which, among other things, includes a commitment to create an evaluation process for a realistic assessment of each state employee's performance. I expect agency heads, using a meaningful evaluative process, to be able to give their exceptional employees performance awards, incent those meeting expectations, provide assistance to struggling employees, and address non-performers.
I also ask state agency heads for a commitment to approach the budgeting process with fiscal discipline. We should exercise restraint when it comes to dealing with public money and always keep a close eye on the size and cost of state government. The commitment letter I am requiring is a first. I remain skeptical that more dollars spent on buildings translates to a better education. Dollars spent on buildings are not dollars spent on teaching: bricks do not an education make. Having said that I understand that we are required by law to have a funding model, but I want a plan in place that convinces me these dollars are being spent for the maximum benefit of Wyoming - its children, teachers and citizens.
Governor Freudenthal recommended $61.9 million for construction of school facilities. This is on top of the $1.2 billion appropriated between 2003 and 2010 and on top of the $156 million approved last session. I will not support Governor Freudenthal's recommendation until I see that an improved preference law is in place and enforced. I want to see a strong preference law and other contracting issues resolved before we pour more dollars through the supplemental budget to the School Facilities Commission. Some of you have assured me that can be accomplished this session. I will look for that bill before approving supplemental monies to build schools. The bottom line of my budget recommendations is that I have cut $22.7 million in General Fund expenditures and $61.9 million in school capitol construction program spending from the Supplemental Budget. Coupled with this week's CREG revenue forecast, the Legislature now has roughly $52 million in the General Fund and $332 million in the school capitol construction program available to you. Don't spend it all in one place. Perhaps, better yet, don't spend too much of it at all.
To create jobs, and to grow and diversify our economy, we should build on Wyoming's natural advantages - our energy, ag, tourism, and great workforce. We should not just extract and export our energy, we should look for value-added projects that use some of our energy here. For example, our superb wind resources partner well with natural gas-fired turbines which fill out the energy stream during lulls in the wind. We should develop both wind and gas-fired turbine projects, where possible. I support current efforts for those working on such projects. And, why not manufacture wind turbine components here, too? Let's build the items needed to develop our wind resources right here in Wyoming. This is doable. Such manufacturers are looking at Wyoming now, and I a supporter. This is an example of how we build on Wyoming's natural advantages to diversify our economy and create jobs. I know there will be a healthy debate about wind issues - property rights, taxation, eminent domain. I hope legislation that balances all the interests and keeps Wyoming competitive will reach my desk this session. We need to continue to capitalize on our natural advantages, not only our wind but our climate. I support funding to recruit mega data centers.
In Wyoming, we have what those centers need. We have the natural advantages: we have a favorable weather climate with a low number of required cooling days; we can produce abundant, relatively inexpensive electricity; we have relative safety from natural catastrophes such as hurricanes, and we have available land. We also have an established track record with the NCAR supercomputer being built in Cheyenne. I support the allocation of $14.5 million in general funds for the recruitment of multiple mega data centers. Such centers bring support businesses and other enterprises along with them. They are a business magnet. I supported the bill passed last year that exempted qualifying computer equipment from sales and use taxes. I thought last year's bill provided an attractive and appropriate incentive for businesses - and I would call for reasonable additions this year, like for computer software, to improve upon it. So, please take a good look at this legislation.
We must continue to support all our extractive industries. With respect to our coal and our oil and gas industries, I support research and development of carbon capture and sequestration technology. I am skeptical about man-made global warming without more and better science; but I am not skeptical about growing demand by our energy customers for cleaner coal and gas, and I am not skeptical about our oil industry's need for carbon injection technology for enhanced oil recovery. Improved technologies provide a benefit to companies and help them remain profitable. Wyoming is on the cutting edge of many technologies. We have laws in place and projects underway. Technologies will be improved with projects - like the UW-GE coal gasification facility, the development of the DKRW project in Carbon County, and advanced research at the School of Energy Resources. Technology will help keep our energy industry competitive. I would look favorably on legislation sent my way to foster science and commercial applications remembering that advances in energy technology will only occur if energy companies remain profitable. I support continuing the manufacturing sales tax exemption. The current law has the exemption expire at the end of this year. Forty other states have this exemption and Wyoming must remain competitive. Nearly 200 Wyoming businesses already use the exemption. As we speak out-of-state manufacturers targeted by the Wyoming Business Council and my office anticipate the exemption. This includes manufacturers of wind tower components which I spoke of earlier. Without the extension, we risk the real possibility these businesses will locate in other states. I hope you will take up the issue of extending the manufacturing sales tax exemption, decide to extend it, and put a bill on my desk.
I am also keenly interested in legislation that will strengthen our ag and travel industries, which are vital to our state's economy, and I know you will be considering such bills this session. For example, I support funding increases for a rangeland assessment and for tourism promotion. We need to make our state regulatory environment predictable and reasonable so businesses can plan and commit resources to our State. The backlogs and delays at the Land Quality Division within the Department of Environmental Quality are an immediate concern. The undue backlogs and delays need to be made a thing of the past sooner rather than later. This issue is addressed in my budget recommendations. The fact that our state is fiscally sound (and a desirable locale for so many other reasons) means that we can welcome with open arms businesses that are looking for a welcoming place.
Improving connectivity provides all sorts of possibilities. It allows us to deal with each other directly and daily, interactively, and not just between the hours of 8 and 5. It increases business productivity and access to markets. I support using technology to maximum advantage - to improve state government, to improve the business climate for tech as well as other businesses, to enrich our personal and work lives, to improve the quality of patient health care through the use of electronic health records to support better communication between physician and patient and prevent expensive duplication of testing. I support measures that will give our state the competitive edge from a technology standpoint. For example, we have already begun work with a private telecom provider to expand the high speed fiber optic footprint across Wyoming. This expansion could increase bandwidth capacity more than tenfold to an additional 11 Wyoming communities. We are also working on "lighting up" dormant or dark optic circuits that run across the southern portion of Wyoming into Salt Lake City and beyond. From an economic development perspective, this growth in connectivity will allow us the bandwidth necessary for mega data centers while also benefiting manufacturing and smaller businesses throughout our Wyoming communities.
Our interstate highways and railroad network connect us in all directions with other states and others parts of the country and should help make us a business hub. The highways, especially, are important for business, personal, and tourist travel. I support additional supplemental appropriations this year for highways. Highway construction needs a reliable source of added funding (on top of those sources that now exist like gas taxes and federal funds). The recommended $52M in supplemental funding this year makes reasonable
progress on highway construction. Those dollars should be used to do what is needed most in 2011. More on this topic follows.
I also support funding for water development projects. Water is a precious resource in the arid west. We need to use all our allocated amounts under the various compacts and court decrees. Water projects spur economic development across the board - for energy, ag,
tourism, industry. Our cities, towns and counties need additional revenue. We saw this most starkly last year. I support a legislative fix that would provide this revenue. Specifically, I support diverting one half of 1 percent of the statutory severance tax on minerals and splitting it
into thirds - one-third to local governments, one-third to highways, and one-third to the state's rainy day fund. This is money that will be used not only to invest in infrastructure, not only to invest in our localities, but also to invest in savings. A good investment all the way around! The projected distribution would be about $52.15 million to each of the three recipient categories.
I would like to see a greater percentage of the local government share go to fund projects - that is, 75 percent should be put towards capital construction and 25 percent for operations. I would like to see this investment - the one-half of 1 percent of the severance tax divided into thirds - be made permanent or long-term with a sunset date 7 years down the road in 2018. I recognize there is disagreement about this proposal as there should be, because this is a great deal of money. We all agree that money should be wisely invested. Some want to place all that money into the rainy day fund. There is no question that our rainy day fund can serve us well during tough times when the price of our natural resources has declined. I have faith in Wyoming, and while we have had wise investments from our Treasurer's office for many years, we also have to be aware that in these shaky times - where major financial companies, where auto manufacturers, where not just companies but entire countries are failing - even the best investment decisions carry risk not seen for many decades.
We have seen the results of these tumultuous times for outside investing. As of now we are back in the black, but in the past year and a half we have seen unrealized losses from state investments, as of June 30, 2009, of over $647 million. The realized losses were $201 million. This illustrates the volatility in markets. We cannot take the risk out of investing in the markets and with my proposal we will continue investing in the market via the rainy day fund, but we will also broaden our investment to Wyoming.
We all care about local governments. This body has a history of supporting local governments in the past. So during this critical time, do we continue along those lines - investing all of that money in companies that may be in other states and other countries or do we believe in Wyoming? Do we believe in Wyoming enough - our people, our towns, our counties, our small businesses, and our future - to put Wyoming first? My proposal invests in local government, in infrastructure, in our highways and bridges and continues to invest in our rainy day account as well. It addresses my goals of economic development, in that our local governments can do all the beautification projects they want but if they don't have adequate water, sewer, roads, bridges, and landfills, recruitment and retention of businesses is near impossible.
One third of this money will go to the Department of Transportation to address the needs of our roads and bridges. We can disagree how much is needed, we can also disagree on other funding options, but hopefully we can agree that without safe, adequate roads, economic development and the enjoyment of our state will be diminished. Hopefully we can also agree that for the executive branch to defer maintenance on our roads is not fiscally strong, it is operationally weak. If we don't invest today, we will require those that follow us to invest many more dollars in the future. I urge you to consider this method of funding our roads. One-third of the money will go to local government.
It is curious to me how many agree with me that the states are the backbone of the country, that people closest to the problems are the best decision makers to solve a problem, and yet when talking about providing greater control to the locals in terms of money, they shy away. In
making your decision, remember that just as some of us view the federal government with a skeptical eye so too does a city council member look at Wyoming's capitol. Do we trust local governments in the way we would ask Congress to trust us? We should, and this one-third is a way to show our faith in local governments. If not made permanent, a seven-year sunset provision is a reasonable compromise that would give the legislature the opportunity to consider the matter again, but also show an ongoing commitment to local
governments and allow for adequate planning and investment. If you do not agree with my proposal, find an alternative because we want and need predictable funding for local governments and for highways.
Last week I announced my support for legislation that would consolidate the Department of Workforce Services and the Department of Employment. I have reappointed Joan Evans as Director of Workforce Services - she is an excellent agency head. I have also appointed Joan to serve as Director of the Department of Employment. I hope you will send me a bill that consolidates these agencies. We will create a one-stop shop for related employment matters, reducing dual administrative costs. I have chosen Tom Forslund to head the Department of Health. He is a proven administrator with an established track record of building reserves and careful budgeting year after year as City Manager in Casper. I would ask you to take a look at the Department that Tom Forslund is inheriting. It is a big, unwieldy agency. It
gobbles up more and more of the budget pie each year. We should take a serious look at reorganizing the Department of Health but I would like Mr. Forslund involved in the process. In the meantime, I would ask for authority to allow me to appoint the head of the Health Care Financing Unit and have that person report directly to me. I'm responsible for state agencies. Legislation is being drafted that would provide me greater latitude in appointing people within agencies. My responsibility to make sure people within agencies are fiscally responsible, provide outstanding service, and follow a vision for the state goes hand in hand with my ability to appoint. I ask for your support for this effort.
In Wyoming it is my belief the vast majority of teachers and administrators are doing a good job. But we recognize we are spending on a Cadillac education plan and not getting Cadillac results. We all know we need to do better. We should not accept the average. And we should be bold in our approach. From where I sit education is too important to remove any debate from the table; there are no sacred cows.
From money spent building schools to block grants provided to districts - let's look at everything. It is also fair to look at changing teacher contracts, but a simple statutory change to alter teacher contracts without more is not a cure-all. Great teachers should be rewarded. Poor teachers should be removed. But, as you consider teacher contracts, it should not be done in a vacuum. We do not want teachers fired for the wrong reasons or for no reasons. What criteria should be used? We want greater accountability and accountability can only come from removing teachers for the right reason; that is that they are not doing a good job teaching. To determine the quality of teaching requires an objective standard. Failing the use of an objective standard we presume the infallibility of administrators. We need a testing program that is administered in a way that will measure students and teachers alike in a manner that clearly identifies both success and problems. The issue of charter schools is one I'm interested in moving forward. It is my belief that charter schools could provide some new ideas to be used at traditional schools. For this model to work, the charter schools cannot cherry pick the best students. We all talk about local control, but I expect school districts to use block grants - state money - in ways that put our students in the best position to succeed. We cannot provide endless funds to school districts without results. I look forward to working with the legislature and with Superintendent Hill on all education issues.
As I said in my inaugural address, the federal health care bill may be the best Congress could do - it is not the best we can do. Therefore, I support legislation that would establish a litigation fund related to the federal health care law. As you no doubt know, I have taken steps to join the Florida lawsuit against the Affordable Care Act. I understand the criticism in doing so - some because they like the Act, some because of the cost associated with the lawsuit. I do not like the Act - in my view it is bad policy and too costly. This law will significantly increase our Medicaid rolls. Mississippi, for example, forecasts the overall cost to implement the Affordable Care Act in that state will
be $1.7 billion over ten years, including $443 million in year 10 alone. While the federal government has committed to the bulk of the cost associated with the Medicaid expansion the last I checked the federal government has significant financial problems. On top of that, the federal promise does not cover all the additional expenses.
Concerning the cost of the lawsuit, the current prediction is that it will cost us $1,000 dollars and the Attorney General has been told it may cost more but not a lot. But, frankly, even for a much larger amount I am willing to fully test the legality of the law because it has implications beyond health care. While this is a Tenth Amendment issue, this law should be tested with the same force as if the First or Second
Amendments to our Constitution were being eroded. I believe that the rights of the states remain important not just for legal principle but because I believe the states can do a better job. Comparison of Wyoming's checkbook to Congress' checkbook is evidence we can and
we have. I hope I will have your support in standing firm for Wyoming. It is not enough to say "no." We should continue to seek state solutions even as we fight the federal law.
I support legislative proposals that advance state health care solutions, including expansion of the Healthy Frontiers pilot project begun last session. That project has passed the initial test and is currently enrolling participants in both Cheyenne and Casper. The expansion will give us the data and the experience that we need to develop more effective and less costly health care options.
There are other areas that require Wyoming to be proactive. We are small in number but strong in our contribution to this country, and our voice should be heard. Challenges to our ability to manage our wildlife, to produce our energy, to regulate our water and air quality,
should not go untested. We demand a balanced approach that protects our beautiful state yet allows for mineral development. It is the citizens of Wyoming, from those interested in conservation to those interested in development; those Wyoming people, us, it is we who should have the debate and make the decisions for Wyoming. The more we turn the issue of balance over to D.C. the more the debate will be taken from our mouths, from these halls, from this building and moved to Washington where only three of our citizens, our congressional delegation, will be joined in the debate while the rest of us are relegated to listeners. As I said in my inaugural address, the best solutions for Wyoming come from Wyoming. I would ask for your support to keep Wyoming's voice strong.
There are other pressing issues, too. The death rate for misuse of narcotic prescription drugs exceeds all other illegal drug and drunk driving deaths combined. We need to better monitor narcotic prescription drugs at point of contact to prevent abuse and lower the death rate. Other pressing matters include health issues, ag issues, law enforcement issues, our aging population. I would look closely at legislation you put before me that addresses them.
Though there is much to consider, I'm a conservative by nature. On both sides of the aisle, we have conservative and practical people. In this general session, I ask for an approach that begins the process of efficient, streamlined government. I will tell you that from my point of view I'm interested in laws that will help those who cannot find work. I'm interested in laws that do not make small business owners shudder wondering what new rules and regulations will come out. We should pay attention to what matters most. This body has and will continue to set an example of vigorous but always civilized debate, and all of us are proud of the example you set. Let's provide a framework where individuals through hard work, innovation and dedication can enjoy the freedoms of Wyoming.
Thank you for the opportunity to address you in this chamber, on your home court, so to speak. It has been an honor and a pleasure. You are always welcome in my office, and I would be privileged to have you visit me. The boxes are unpacked, the welcome mat is out and the welcoming Matt is in, and the door will be open. May we have the vision, the courage, and the faith to make wise decisions?
May God bless us all, our great state, and our great country. Thank you.