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- I'm Craig Blumenshine from Wyoming PBS.

Join me as I sit down with Wyoming Governor, Mark Gordon, we'll visit about the year, just past, what's ahead in 2022, the governor's budget that he just submitted to the Wyoming legislature.

What it means to be a Republican in Wyoming.

What he thinks about Wyoming's economy, and much more.

All that's ahead on a special Capitol Outlook.

A conversation With Governor Mark Gordon.

(intense music) - [Announcer] This program is supported in part by a grant from the BNSF Railway Foundation, dedicated to improving the general welfare and quality of life in communities throughout the BNSF Railway service area.

Proud to support Wyoming PBS.

- Welcome to this special edition of Capitol Outlook.

I'm Craig Blumenshine from Wyoming PBS, and it's our pleasure to be joined by the Governor of the State of Wyoming, Governor Mark Gordon for our annual one-on-one conversation.

Governor, welcome back to Capital Outlook.

- Oh, it's wonderful to be here Craig.

- It's been an interesting year Governor, as the state has gotten back on its feet, from the pandemic.

We've got a lot to talk about in the year past, and also we're gonna look forward just a little bit, but Governor, if I could, I'd like to start with your view of the state's economy.

It seems to me that Wyoming is struggling maybe just a little bit, in finding its way to diversification.

It's been talked about for a decade, or more as you well know.

And current statistics from the U.S. Department of Labor and Statistics have Wyoming near the bottom of new job creation.

Pretty much from summer to present day as we speak today.

Here in Cheyenne, a little different, job markets hoppin but for the rest of the state, maybe not the same, what's your view Governor, on Wyoming's economy relative to diversification as we start our discussion today?

- [Mark] Well, and Craig, I think you make a good point.

This is a goal for many generations.

I can remember back to Governor Sullivan.

I can remember Governor Geringer, all of these governors that have tried to bring diversification.

I think Wyoming has always reacted to difficult times by having a good view of the future.

And I think that's what's happening right now.

We haven't seen that many jobs that have been created recently, and a large part of that is just sort of the devastating, or one after another impact.

First, the Saudi-Russian oil war, that knocked out oil production, then, COVID which sort of decimated the entire country's economy.

And then, you have an administration, in this administration, the Biden Administration, that single-mindedly has been about slowing down fossil fuel development, eliminating if at all possible.

And that's just wreaked havoc, and I think was Wyoming's normal economy.

On the upside, this year we saw record numbers for tourism, we saw good prices for agricultural products.

We started to see more entrepreneurial effort to try to build more meat packing capacity, and so new enterprises.

And then, on the horizon, and these are the things that I think are a little slower and evolving.

We have seen a tremendous number of trust companies that have started to relocate to Wyoming.

We see with the work we've done with blockchain, that there are some new industries that are starting to charter their enterprises here.

That'll take a little longer to develop, but I do think we are rounding a curve, and I think our economy will start to improve.

- [Craig] Do you anticipate that this is a second, third, fourth quarter 2022, thing that we should see these statistics improve, and Wyoming lift itself out of the bottom of these national numbers.

Because Governor, COVID affected every state in the country.

- Absolutely.

- These extractive industry, problems have been our Achilles heel.

Is that what the state should expect?

- Yeah, I think it's gonna take a little longer than fourth quarter '22, but I do believe during '22, we're gonna start to see steady growth.

Recently was up in Casper College and spoke a lot with what we're talking about, with our Wyoming Innovation Partnership.

And it is about growing lots of little businesses it's about making main street whole again.

None of these are intended to sort of change our job perspective from having one industry that's gonna employ everybody.

It's about getting lots of little businesses started, getting our main streets going, making sure that those communities are whole.

In that way, in the natural business cycle, if we have one business fail, that has six, or seven employees, that's a lot different than having something we've put a tremendous amount of money in, and brought in 200 jobs, and that disappears the way it did for Casper with our call center.

So we're looking really across the spectrum, then it is the diversification.

That diversification of the economy is one thing I think we can do, diversification of the revenue streams for Wyoming, is another question.

- Governor, that's the perfect segue that I want to visit with you next about.

I think many people in Wyoming still might not understand the revenue component of state government, from the aspect of how energy still carries the day.

In fact, we're showing our viewers a chart now, and I would want to give the chart to you.

And you testified about this chart in front of the Joint Appropriations Committee, when you were presenting your budget, about the dollar value and services, Wyoming folks get.

Me, my friends and my neighbors, the value of those services, based on the value that we pay.

What don't Wyoming I understand about the chart that they're looking at?

- [Governor] Well, what'd you see here is what a family, I believe, it's now of four pays annually in taxes, and it's around $3,700.

And for the services they get back, they actually receive about 28,000 , a little bit more than $28,000.

You could see that-- - And that money comes from?

- And you can see the breakdown, and it comes from the mineral sector.

Our tax structure, and in indeed, and I'll actually put it a little bit further than that.

We have severance taxes, royalties, bonus payments that come from oil, coal, and gas, uranium, some Trona.

And those all make up the bulk of our revenue.

Now, sales and use tax this year was pretty good, but sales and use tax makes another big piece of that.

But that too, is leveraged by the prospects of our mineral industry.

When we have coal mines that are up and running and buying new coal trucks, and things like that, our sales and use tax goes up.

Right now, we see a little bit of a bump because, some of the wind farm activity is also contributing to sales and use.

But people in Wyoming don't understand, really what a good deal they have.

Now, I know people will say, "But we pay so much in federal taxes.

We're still heavily, heavily taxed, there's no reason why, you should even show this chart, it's not correct."

But the fact remains, Wyoming's mineral producers, pay the bulk of the taxes in Wyoming.

And in fact, enough so, that they set aside, a tremendous amount of our savings.

And you and I have talked about those over the years, the Permitted Mental Trust Fund, the Common School, these are all funds, that have for the most part, been buttressed by mineral and extractive industries.

So, Wyoming really does depend a substantial amount on our ability to have a viable industry.

- So you wrote this in your budget letter, to the Wyoming legislature, you presented what I'll call and what people are calling a flat budget, I think you would agree with that.

You said this, you said, "Today's good fortune..." That you just talked about is a reprieve, "But it's not a solution to our budgets stability."

- That is correct.

- Governor, what's the answer?

So what's the answer?

(chuckles) - Well, I think that the answer is, that we're gonna have to diversify, and look much more carefully at our revenue streams.

Wyoming's constitution has some provisions that govern local tax structures.

And indeed, Wyoming has always been a low tax state.

When we diversify economically, we can't take advantage necessarily.

And this is in fact, one of the problems we saw with some of the enterprises that we looked at, up in the Northwest part of the state, wasn't associated with the mineral extraction industry.

So, while we could have a wonderful, in that case, a particular drug company, that had been in Wyoming for some time.

The kids that work for the...

The children of families-- - Family members.

- That worked there, were getting an education in Wyoming.

But their parents and the industry wasn't having to pay the taxes to carry that burden.

So, we've sort of put ourselves at a disadvantage.

And I also think it doesn't give us many tools to be able to attract new industry to the state.

Just about a week ago, I was talking with Micron.

Micron has a chip manufacturer-- - [Craig] Chip manufacturer.

- In Boise.

And talking about what does it take to consider bringing chip manufacturer to a place like Wyoming?

So, a couple of key ingredients to that, obviously, you got to have the materials to make it, but helium is what you absolutely have to be able to have a great source of, in order to build those chips.

Wyoming has a lot of helium, we have about 20% of the world's capacity.

So it made sense to me, that we could figure out how to bring the industry here.

Their comment was, "Well, what are you gonna do for us?"

And I said, "Well, you don't have to pay any taxes."

And they said, "So what are you gonna do for us?"

And it is interesting, 'cause you go to other states, there are tax incentives that they can provide.

There are ways that they can do local tax, that's in fact, what Texas has done.

- There is one revenue option that has been discussed by one committee of the legislature, and that's a fuel tax.

A 15 cent per gallon, fuel tax, Governor.

Where do you stand on that?

- Well, I think first off, I need to see what the legislation is when it finally comes-- - It sounds pretty simple to me.

- Well, I understand that, but, let me say this about that.

My view, is that Wyoming has suffered a number of shocks.

I just went through the three that really sort of brought us to our knees.

We're just beginning to recover.

We have inflation at the highest rate it's been, 6.8%, third quarter, now it's sort of a national trend.

We're seeing a lot more inflation coming on board.

I am not confident that, that tax is really what we need to pursue at this juncture.

- And Governor, I wanna talk about vaccinations.

- [Mark] Hmm.

- You have actively and strongly argued, and I think the state support you in the argument that you oppose vaccine mandates.

And you've had success, I think in having through your attorney general arguments that have been successful.

However, Wyoming is at the bottom of vaccine rates.

When you step back Governor, and now with the Omicron variant coming our way, what's on your mind about that?

- Well, let me make it clear, both Jenny and I have been vaccinated.

We've had the booster, we take the precautions that are necessary, I've always said that that's a personal choice, and it's certainly the responsibility that I grew up with as a Republican.

And I feel very strongly about that.

I think mandates never really work all that well, but I've been really devastated by seeing the numbers of deaths climbing.

And I have been concerned about our people, and particularly our kids as this year develops.

And I think all of us thought, if you remember, we're gonna be over in 10 days, we're gonna be over next winter.

It's gonna be when it's cold, when it's hot, there's all kinds of theories that when it's over.

And I think we know, that we're gonna have to live with COVID for the next several years.

Omicron obviously, introduces a new element into that-- - Are you worried about it?

- I am worried about it.

I'm worried about it because, Wyoming thrives a lot on our tourist industry.

It's probably fortuitous in a way that, this isn't coming in the summer height of tourist travel.

We don't know exactly how successful the vaccine is, against the Omicron variant.

It seems to be spreading very, very rapidly.

There is some conversation that it's not as serious, but, I think all of these diseases are serious.

And we still need to take our precautions that we can.

My hope has been that people would realize this is not about politics.

This is about the health of our citizenry, this is about taking responsibility for our neighbors.

And from the beginning, that's been the message that I've tried to stand up.

My concern is that, it's perceived as somehow be valiant to really push back against the politics of this.

But the argument really isn't about politics.

I think it's about personal responsibility, personal choice.

- I want to stay on the politics subject if we can, Governor, and talk about civility, just a little bit.

Senator Fred Baldwin posted this today, about an hour ago on his social media page.

And I asked him for permission, if I could talk about this with you tonight, he quoted this, he said that he's generally worn down from the anger, name-calling, misinformation, and conspiracy theories, and lack of goodwill towards men, generally are growing dominant on all social media and in society generally that he's experiencing.

You and I both know Senator Baldwin, Baldwin's one of the kindest people you'll meet, and an effective Senator.

What's happening in our state here, Governor?

- It is one of the most disturbing things to me.

I understand when people are angry, I understand when they're scared, and understand that we lash out from time to time, but when it becomes the currency of conversation, it was this incivility, this kind of bullying approach to trying to intimidate others.

It's not the Wyoming I grew up in.

It's not the Wyoming that I love, and that I want our children and our grandparents to grow in.

I really struggle with what my dad would have thought about that language.

And most importantly, I worry a lot about, what's the message we're giving our kids.

America is the "Shining City on the Hill", that's what Ronald Reagan said.

George Herbert Walker Bush talked about compassionate conservatism.

These are the things that values that I think are most important.

It is really sad to me, that we have devolved into sort of name calling and anger and ranker, we've certainly felt a lot of that.

- [Craig] You told me a year ago when we talked that Republicans have a big tent in Wyoming, you hoped.

And I would assert, maybe that's not as true today, maybe you would disagree with me.

But I asked you in the context of the Republican Party, who, of course, we all know voted to no longer recognized, Representative Liz Cheney as a member of the Republican Party.

What was your reaction when you saw they did that?

One of the most conservative members of the House?

- Right, no, no, I think that is certainly been her background.

I mean, she's certainly been a very, very conservative, her dad was conservative.

And to me, I was really disappointed that the party would step out like that.

And as I say, I think people are disappointed by Liz Cheney's vote on the 6th of January.

- Were you?

- I thought at that point, Craig, that the issue had been resolved, that there was really no reason to kind of proceed.

I think you vote, she took it in good confidence, in her mind.

And I think that was her prerogative.

That's why I think people voted her into office.

I don't think I would've done the vote the same way, but I wasn't there.

And to me, we had an election, the voters had spoken.

I mean, there's some still some questions about whether they spoke correctly, or whether we counted correctly or whatnot.

But to me, that issue had been resolved, and it was time for our country to get back on the horse, and start moving forward.

And that's, I guess, the way I grew up, so.

- You in your budget, back to your budget, if I could briefly-- - Sure.

- [Craig] Made a well-founded argument, it's time to up state employee salaries.

And I wanna ask you about COLA for retirees.

Not because I'm becoming one of them, Governor.

(laughs) And my wife's with us today, I haven't told her that public sector employees are scheduled for their first COLA since 2009, in the year 2046, because that's when that fund is set to be solvent.

Why not also uplift the Wyoming retirement system to support COLA for the state's retirees, at this time?

- Well, it's been in a discussion that's gone on for some time.

And I having participated at the treasurer's level with the retirement system-- - [Craig] Its in the annual report every year.

- And what I've really worked on, has been to get it in better circumstances.

As you know a few years back, Wyoming's retirement fund was not as well situated.

I recognize, and I particularly recognize in light of the fact that, we have a national policy, which has not done, has kept interest rates in incredibly low, that anyone living on a fixed income, is really having to deal with some challenges.

And now of course, we have inflation over the top of that.

I think it's prudent that we look carefully.

I know that the retirement system is anxious, to retain their funded level.

And we've worked very hard to make sure that states and retirees know that we can pay the obligations we have.

- One more budget question, and then we'll have to wrap things up.

And it has to do with the School Foundation Program Governor.

And there are still some longterm projected deficits in the program.

Not as big as those deficits were projected a few years ago, or just as recently as a couple of years ago.

But still, the legislative stabilization reserve account will have to backfill to the tune of 90 plus million dollars in this biennium.

You don't have direct control over that, but you have the ability to guide discussion about it.

What have you talked about with legislative leadership, and school leadership, about the need to take a look at, what the School Foundation Program is costing the state and its ability to have revenue to support it?

- Well, ever since I've been governor, and probably for a few years, while I was treasurer, this state's conversation about education has always revolved around funding.

Are we compelled to fund education at whatever, our consultants tell us we have to fund it, or do we just raise taxes to do that?

Or do we cut education and make it more accountable?

Whatever the phrasiology is.

But the discussion has always been around, how much does it cost, and how do we fund it?

What we've done, is to take a look and I've put a group together we call it a RIDE, which has a number of citizens, that are tasked with, "Let's go, look at the schools, talk to the schools, talk to the parents, talk to the industries in these communities.

And find out, what is it that we really expect our schools to deliver to our kids?"

Not in the context of if it's too expensive.

In fact, that's not even supposed to be part of the conversation.

It's just, what do you think our students ought to be learning?

- Is this a basket of goods conversation, so to speak?

- Well, it could eventually turn into something like that.

It's not intended to be, this is intended not...

It's intended to just be an organic conversation about what is it we really want our schools to do, and be able to deliver for our students.

There is that whole conversation about basket of goods.

And of course, that's what drives the funding mechanism.

So I tried to say, let's not worry about basket of goods.

- [Craig] So what are you learning?

- They're gonna issue a report.

And I gave them over a year to do this, because in the context of an election year, there's obviously gonna be a certain of edge to that conversation.

I'm gonna be very interested to see what they come out with in the fall of 2022.

And I'm very anxious to hear the conversations that come from that.

Because I do think that there is more to education than how much does it cost, more to education than are teachers accountable, or tenured or not.

There is a lot to talk about, maybe the way we craft our days in school, or our years in school, that needs to be examined.

I really wanted them to take an organic look without constraints, to the people of Wyoming and say, "How are we gonna do this?

Are there different ways that we can deliver this education?"

- [Craig] Speaking of elections, Governor, when are you gonna announce your reelection bid?

- Well, I think when the time is right, and I think right now I have a job to do.

And that's exactly what I'm focused on.

I'm focused on this budget, I'm focused on delivering what is, I think the people of Wyoming expect me to do.

We need to get through a legislative session.

I think this is gonna be a very complicated legislative session.

I think people are still raw from the special session.

I think redistricting is gonna be a huge issue, the budget's obviously, big.

This one we have with a special layer of frosting of ARPA funds over the top.

And then I'm sure there'll be other issues that show up.

So my attention and everything about this is on getting this job done the way people in Wyoming expect me to.

- My top of my list for 2022 resolutions for Wyoming are that, is that what you're telling me?

Doesn't have anything to do with what might happen in August or November, Governor?

- My resolution for 2022 in this office, is to try to bring as much civility and respect to our conversations, about the future of Wyoming as I possibly can.

I think that's gonna be a very important feature of this year.

If we can respect one another, if we can have a good conversation, the way Wyoming has always faced adversity, we will thrive.

So, that's my top list.

I wanna do the best job I can for the people of Wyoming.

I wanna see our economy robust.

I wanna see kids wanting to stay in Wyoming.

I wanna see families saying Wyoming, that's the place I wanna move to, 'cause that's where I want my kids to be.

- I was stunned yesterday when President Seidel said that 70% of the University of Wyoming graduates go out of state, I did not realize that number was that high.

So I hope your resolution comes true.

- [Mark] Well, Craig, on that note, part of what we're doing with right, and part of what we're doing with our WHIP initiative, which is our higher education initiative, is to really talk about, "Are these working on keeping people here?

Are they working to build businesses that attract people?"

So, we're trying to put some metrics in on exactly that point.

- [Craig] And I hope civility goal goes down to city council meetings, to county commissioner meetings, to school board meetings, and across the realm of politics in Wyoming Governor, I really do.

So, what are your holiday plans?

What are you in the first lady gonna be doing, how do we celebrate that?

- We have grandkids, and one of them is just a little bit over three years old.

So, this is gonna be a Christmas that is gonna be very special.

We're gonna spend a portion of it with them.

And then I think we're gonna go back to the ranch, and kind of catch up a little bit with cows.

And we may take off and go do a little cross country skiing, or something somewhere in the Bighorns, or maybe over in Yellowstone, or something like that.

- [Craig] Well, Governor to you and your staff, and to the first lady and her staff, I wanna thank you personally.

It's been a pleasure to visit with you and to work with you.

And I hope you have a very Merry Christmas.

- [Mark] Well, Craig, the honor is mine.

It has always been a pleasure to talk to you, and your investment in Wyoming, your experience with Wyoming Chronicle and all that you know, is something that I've always been appreciated.

- I appreciate that.

Thank you, Governor for joining us on Capitol Outlook, thanks.

(dramatic music) - [Announcer] This program is supported in part by a grant from the BNSF Railway Foundation: Dedicated to improving the general welfare and quality of life in communities throughout the BNSF Railway service area.

Proud to support Wyoming, PBS.