Dead on arrival: Real estate transfer tax fails on introduction

JACKSON HOLE, Wyo. — The state’s tax-averse lawmakers failed to advance a bill that would have allowed Teton County to generate revenue from its blistering real estate industry. Same as they did at last year’s session. Same as they’ve ever done.

Rep. Andy Schwartz (D-Jackson) has tried numerous times to get legislation through Cheyenne that would allow counties that wished to, to impose a real estate transfer tax. Attempts to pass similar bills have been tried unsuccessfully for decades in Wyoming.

The legislation never gets anywhere—fought tooth and nail by the Wyoming Association of Realtors and other lobbyists. It is also considered by most lawmakers a ‘Teton problem,’ which has usually rung the death knell for such proposed laws. Finally, the Republican-dominant Legislature has historically been very reluctant to raise taxes, or especially create a new one.

In Teton County, lawmakers are looking for any way to create a reliable revenue stream and tapping into the county’s red-hot real estate market seems a logical place to start. This piece of legislation could have brought a projected $20 million to the county to help with a workforce housing crisis.

“Real estate is to Teton County what coal is to Campbell County, except that we get to sell it again and again, and at a higher price each time,” Wyoming Association of Municipalities lobbyist Bob McLaurin said, testifying in support of the bill.

Fourteen states, including Wyoming and Idaho, do not have a real estate transfer tax.

But HB35, sponsored by the Joint Revenue Interim Committee, would have needed a supermajority two-thirds vote during this budget session as a non-budget bill. It never came close. Instead, it received a supermajority thumbs down (19-40) from the House floor at introduction Wednesday. Last session, a similar bill died in committee on a 5-4 vote.

The bill would have imposed a 1% fee on real estate transactions over $1,500,000.

Rep. Mike Yin (D-Teton) said the bill was his top priority going into the 66th Wyoming Legislature.

“The median home price last quarter in Teton County was $2.9 million. This about that for a moment,” Yin said, addressing the House of Representatives at the bill’s introduction Wednesday. “This affects our workforce—hiring educators, snow plow drivers, judges, anyone who works in Teton County.”

Two representatives spoke in opposition. Rep. Shelly Duncan (R-Goshen) called the bill an example of unequal taxation. Rep. Mark Baker (R-Sweetwater) voiced his opposition as a realtor.

“As a realtor, we oppose this,” Baker said. “Often people don’t buy these types of big properties [in Teton County] with the intent to flip them. They’re buying them and holding them. So, we would probably only see a one-time infusion. I am against this.”

Rep. Schwartz told WyoFile in December, “My hope will be that, even if it dies in this session, that it will come back as a committee bill in the general session.”

Sponsored By: Joint Revenue Interim Committee

AN ACT relating to taxation and revenue; providing for an optional excise tax on the sale of real property as specified; providing for distribution of the tax; providing for a reduction of local distributions based on revenue collected from the tax; requiring rulemaking; imposing penalties; and providing for effective dates.

1/18/2022 Bill Number Assigned
2/11/2022 H Received for Introduction
2/16/2022 H Failed Introduction 19-40-1-0-0

ROLL CALL

Ayes:  Representative(s) Banks, Connolly, Eyre, Flitner, Greear, Hallinan, Harshman, Lebeau, Nicholas, Paxton, Provenza, Roscoe, Schwartz, Sherwood, Stith, Sweeney, Wilson, Yin, Zwonitzer

Nays:  Representative(s) Andrew, Baker, Barlow, Bear, Blackburn, Burkhart, Burt, Clausen, Crago, Duncan, Eklund, Fortner, Gray, Haroldson, Heiner, Henderson, Jennings, Kinner, Knapp, Larsen, L, Laursen, D, Macguire, Neiman, Newsome, Oakley, Obermueller, O’hearn, Olsen, Ottman, Rodrig-Williams, Romero-Martinez, Simpson, Sommers, Styvar, Walters, Washut, Western, Wharff, Williams, Winter

Excused:  Representative Brown

Ayes 19    Nays 40    Excused 1    Absent 0    Conflicts 0