Director Brett Fanning of the Wyoming Department of Revenue told the Revenue Committee that Wyoming’s mandatory statewide sales-and-use tax is 4 percent and that the state’s distribution system splits the revenue between the state and local partners. "About 69 percent of that statewide 4 percent goes to the general fund," Fanning said, adding that the balance is returned to counties and municipalities under established formulas.

The distribution system matters because the statewide 4 percent is only the base: local voter-approved “pennies” — commonly called the fifth penny (general purpose) and sixth penny (specific purpose) — are added on top where voters approve them. Fanning said those voter-approved pennies carry a small administrative fee to the state, but 99 percent of those collections go back to the local jurisdictions that imposed them. He also reviewed lodging and resort-district levies and a municipal option that the City of Casper recently approved and implemented.

Why it matters: Sales and lodging taxes are a major revenue source for Wyoming counties and municipalities. The mix of state and local receipts, the presence or absence of voter-approved pennies, and municipal options directly affect local budgets and services.

Fanning walked the committee through four primary buckets: the statewide 4 percent, the general-purpose local penny (commonly the fifth penny), specific-purpose pennies (sixth penny), and special buckets like resort-district taxes and the municipal option. He said the statewide 4 percent is distributed so the state receives roughly 69 percent and the remainder funds county and municipal shares; an additional administrative deduction of 1 percent from the local remainder is retained in the general fund.

Fanning noted a statutory county guarantee embedded in the statewide 4 percent: each county receives a minimum distribution (currently structured as $40,000 annually from sales tax and $10,000 from use tax) before the remaining local share is allocated on a population formula. He told the committee some counties rely on those guaranteed amounts materially, while others do not.

On municipal options and recent changes, Fanning said Casper’s municipal option — the first to be enacted in Wyoming — increases the combined tax rate inside Casper city limits to 6 percent; he recommended vendors and residents use the city’s online boundary tool to determine whether an address is inside municipal limits. He said the municipal option began distributions on April 1, 2025.

Fanning outlined lodging tax rules: the mandatory statewide lodging assessment is 5 percent, of which roughly 3 percent is earmarked for the Wyoming Office of Tourism and about 2 percent returns to the county where the lodging transaction occurred; counties may also voter-approve additional local lodging pennies up to a statutory cap (2 percent local cap was noted). He said resort districts — currently implemented only in Teton County (Teton Village Resort District and Grand Targhee Resort District) — add an additional levy on meals within the resort districts, producing the highest local combined rates in the state.

Legislative Service Office staff reiterated statutory mechanics during Q&A. Josh Anderson of the LSO explained the labels “fifth penny” and “sixth penny” are common shorthand but statutory law allows up to three additional voter-approved pennies (general purpose, specific purpose and economic development) in any combination up to the statutory cap. Anderson said specific-purpose taxes must be spent as voters authorized on the ballot and that some statutes allow local treasurers to hold reserves to cover amended returns and refunds.

Committee members pressed Fanning on administrative details: Representative Lean asked whether counties and municipalities are bound to spend fifth-penny dollars as described on ballots, and Fanning replied there are statutory obligations and he would provide the committee more-detailed citations. Co-Chair Locke asked for clarification on the county-guarantee line item; Fanning explained the guaranteed $40,000/$10,000 amounts are part of the statewide 4 percent local allocation before the remainder is distributed by population.

Fanning also described how voter-approved specific-purpose pennies flow from the county treasurer to the entity designated by the ballot question; local treasurers are the implementing agents for those voter-directed allocations.

What the committee asked for and next steps: The committee asked Fanning and LSO to provide statutory citations and a short memo clarifying (1) which local pennies are voter approved and how they may be used, (2) the administrative fees taken by the state from various penny buckets, (3) the county-guarantee calculations, and (4) implementation details for the municipal-option boundary and remittance process. Fanning agreed to follow up with the requested detail.

Context and limitations: The department presentation summarized current statutory distribution formulas and recent local experience such as Casper’s municipal option. Fanning said the department will provide written follow-up with the statutory citations and distribution-model examples that committee members requested. The committee did not take formal action on policy changes during the briefing.