Hello, and happy Halloween Eve!
A phrase gaining traction in Jackson Hole is “Angry August.” It describes that final stretch of summer when everything feels, well, stretched. Schedules, patience, tempers – the whole lot.
Perhaps because we are living in such fraught times, this year’s Angry August seems to have extended into Angry Autumn, a phenomenon I recently experienced first-hand.
When making a left turn at a four-way stop, I nearly hit a car that pulled out right in front of me. Unnerved, I laid on the horn. In response, I was greeted by both a middle-finger salute and a stream of profanities stretching from the other car to mine.
Moments later, the other driver pulled over, glared daggers at me, and continued to gesture and yell. He then pulled in behind me – so close I expected to be rammed – all the while keeping up his salute and leather-lunged vitriol.
This continued as I worked my way down the road. While the gestures and profanities may have entertained folks walking on the street, they caused me increasing concern. Finally, and after what seemed like forever, my new friend made a U turn and delivered his rhetorical coup de grace: “**** you, you ****ing piece of **** liberal.”
Reflecting on the incident, I had three reactions.
First, the other driver was apparently having a very bad day.
Second, I can only dream of having my voice carry so well that it can be heard by the driver of the car ahead of me.
Third, I had no idea I was a liberal.
I grew up in a politically-involved family. Both of my parents were what might be termed “Rockefeller Republicans,” leaning liberal on social issues and conservative on financial ones. Under our parents’ tutelage, my sister, brother, and I learned to love our country, its institutions, and its ideals. We also learned to seek and value both education and truth.
If, as the wags note, facts have a liberal bias, then I suppose I am a liberal – I do, after all, use facts as the foundation of this newsletter. But does a liberal oppose tax increases or look to cut government budgets? As you’ll read below, that’s my current m.o.
More importantly, do labels really matter?
All this was on my mind recently when I wrote the memo that, slightly modified, forms the basis of today’s newsletter. Directed to my fellow Jackson town councilmembers, the town’s senior staff, and my colleagues on the Teton County Commission, I wrote the memo in response to discussions the council is having about the future of the town’s budget, in particular the fact that, over the past few years, the town’s expenses have grown more rapidly than our revenues.
How best to address this problem? To me, the answer is clear. We need to spend the next couple of years focusing on reducing expenses, which in turn will give us the credibility to pose to voters the question dictated by our budget math: Do you want higher taxes or fewer services?
As always, thank you for your interest and support.
Jonathan Schechter
Executive Director
PS – The memo below was aimed at folks who understand local government finances pretty well. If you’re not in that camp, at the end of the essay you’ll find a “Local Government Funding Primer.”
PPS – I wish I could write well enough to capture the awe and gratitude I feel towards Mr. and Mrs. Old Bill, the Community Foundation of Jackson Hole, and all those who help make Old Bill’s Fun Run a reality. Simply put, because of you Jackson Hole is a immeasurably better place for all of us. Please accept my deepest and most heartfelt thanks.
PPPS – In my September 24, 2025 CoThrive, I posed five questions which I feel frame Jackson Hole’s future. As part of the Teton County Library’s “Swap Meet” series, I’ll be leading a discussion about the questions at the library on Thursday, November 13, from 7:00 – 8:30 pm. If you’re interested in joining the conversation, I’d love to see you there.
The questions are:
- Our ecosystem: Is it still our priority?
- Our character: What do we value?
- Champagne tastes; beer budget: What is the proper role of government?
- Subsidizing local business: Whom shall we house?
- Gridlock: How much traffic are we willing to put up with?
29 years; over $300 million raised
Introduction
When it comes to the town’s financial future and, in particular, raising revenues, my thinking is shaped by four beliefs and two facts.
Belief 1: Local government uses money efficiently, wisely, and well.
Belief 2: Local government needs more money.
Belief 3: The best way for local government to get more money is through a 7th cent of general revenue sales tax.
Two reasons:
- The general revenue 7th cent comes without any strings attached; and
- The general revenue 7th cent would raise far more money than any other revenue tool we have.
- If the general revenue 7th cent were in place this year, it would have raised roughly $11.3 million for the town. In contrast, maxing out property taxes would have raised $6.4 million, and maxing out the lodging tax $1.9 million.
Belief 4: Enacting the 7th cent requires voter support. Unfortunately, if the vote were held today, the tax would lose because voters don’t trust government.
The same logic applies to the lodging tax.
Fact 1: The first time it will be possible to enact a 7th cent of general revenue sales tax is 2028, when the current Justice Center SPET will be fulfilled.
Fact 2: I’ve never lost an election. If we go for a 7th cent in 2028, I don’t want to lose that one either.
Given all this, I feel strongly that, over the next three years, everything we do should be oriented towards winning a 2028 vote for a 7th cent of general revenue sales tax. In particular, starting now, before taking any action we should ask ourselves: “How will this affect the 2028 7th cent vote?”
Put another way, I feel we need to spend the next three years earning voters’ trust in government. How? By taking three basic steps.
Step 1: Local government needs to spend the next few budget cycles taking a hard look at its expenses.
Step 2: Local government needs to make sure voters understand it is taking a hard look at its expenses.
Step 3: Local government can’t ask for any new money before 2028.
Why refuse to ask for any new money? Because doing so before 2028 will reenforce voters’ concerns that local government cares more about revenues than expenses. In turn, that will make voters even more suspicious of government, thereby making it even harder to pass the 7th cent.
Here’s how my thinking applies to the two major budget issues we’re currently considering.
Lodging Tax
I oppose putting a lodging tax on the November 2026 ballot. Why? For three reasons.
First, no natural constituency supports it. There are, however, large numbers of voters with deep concerns about our growing numbers of tourists. As a result, the measure’s opponents will have an easy time mustering “no” votes by pointing out that 60% of the proceeds must be spent on tourism promotion.
Second, because the lodging tax’s politics are so difficult, the only way it can win is by receiving the active, full-throated support of the tourism industry. Unfortunately, the tax doesn’t have this support. Nor will it: No tourism industry leader I know supports increasing the lodging tax, and many oppose it.
Third, if the lodging tax loses in 2026, its defeat would further sour voters towards local government, making it that much harder to pass the 7th cent of general revenue in November 2028.
Town of Jackson FY27 and FY28 budgets
In FY26, the town is budgeted to collect $36.3 million in revenues and spend $39 million, a shortfall of $2.7 million. At year’s end, this will leave a general fund balance of $15.5 million, 40% of our expenses.
Over the last several years, the general fund balance has grown because the town has taken in far more than it has spent. As a result, I’m okay with the FY26 shortfall, particularly because our year-end 40% general fund balance will be well above our 25% target.
For the same reasons, for FY27 I can support a budget that spends up to $1 million more than we anticipate collecting. Starting in FY28, though, the only budget I will support is one that breaks even or has a surplus.
In short, over the next two fiscal years I want the town to cut roughly $2 million in expenses.
This is “Step 1” of my three basic steps above: “Local government needs to spend the next few years taking a hard look at its expenses.”
Where would I make those cuts? I have no idea, so I wouldn’t try. Instead, I’d direct staff to identify potential cuts and bring various options back to the council. I’d take this approach because the town’s budget is so complex and tightly knit that identifying where and how to make thoughtful cuts requires skills and knowledge that staff has, and council doesn’t.
As we take Step 1, we also need to publicize what we’re doing; i.e., we need to take Step 2: “Local government needs to make sure voters understand it is taking a hard look at its expenses.”
Conclusion
In summary, for the next several years all of my budget-related thinking will be targeted towards winning voter approval of a 7th cent of general revenue sales tax in 2028.
For this to happen, we need voters to trust us. To earn that trust, we need to take three steps:
- Reduce expenses
- Educate the community about our budget
- Not raise taxes
Because the 7th cent would generate so much more money than any other source, I would rather spend a few years working to secure the big prize in 2028 than risk compromising it sooner (especially because the alternatives are far less lucrative and involve far trickier politics).
Put another way, I want to make the 2028 sales tax vote a referendum, one asking voters to make a choice: “Do you want to keep the current tax structure and receive fewer services, or convert the 7th cent to general revenue funding and receive the same quantity and quality of services – or perhaps even more?”
This is a winnable election question, but only if we do the proper groundwork ahead of time.
Afterword
By suggesting we focus on 2028 and work backward, I’m taking a long view.
Taking an even longer view, I also think we should develop and begin executing a multi-year strategy for getting the state to enact a real estate transfer tax (RETT).
As I see it, this process would take at least five years, and likely longer. It would involve systematically building a statewide coalition, identifying and trying to sway RETT opponents, and doing everything else it would take to get Cheyenne to enact a RETT.
This won’t be easy. I advocate it, though, because real estate is to Jackson Hole what coal is to Wyoming; i.e., our primary asset. Better still, Jackson Hole real estate is a renewable asset: while a piece of coal can be taxed just once, a piece of Jackson Hole real estate can be taxed every time it sells.
I also advocate pursuing the RETT because the numbers are so compelling. For example, this year if Teton County had in place a RETT of just 1%, it would generate around $20 million. Figure a 54%/46% split of the proceeds, and the RETT would put about $9 million into the town’s coffers.
And even if, say, the first $1 million of a sale price were exempted, the RETT would still generate around $15 million total, with $7 million for the town.
Getting the state to approve a RETT won’t be easy, but neither was getting the lodging tax approved. Nor were the other Jackson Hole-led firsts the state now embraces. As with these other endeavors, while the effort would be tremendous, so would the rewards.
Local Government Funding Primer
Generally speaking, US local governments get their revenues from some combination of three types of taxes: income, property, and sales.
For the Town of Jackson, income tax isn’t an option because Wyoming has no income tax.
Property tax is a possibility, because legally the town can levy up to 8 mills (currently we levy ½ mill). Politically, though, recent increases in property values make raising property taxes essentially impossible.
Why? Well, to use my personal situation as an example, over the last few years my property values have doubled. With it, so have my property taxes.
You know what hasn’t doubled, though? My income. As a result, while my balance sheet is stronger, my day-to-day financial situation is weaker: Regardless of how strong my balance sheet is, I have to pay my property taxes off my income statement.
In such a situation, asking people to pay even higher property taxes is a political non-starter.
So that leaves sales taxes.
Sales taxes are the Town of Jackson’s lifeblood, accounting for 75%-80% of each year’s general operating revenues (Figures 1 & 2). At the moment, however, that revenue source is essentially maxed out.
Under Wyoming law, no county can charge more than 7% in sales tax. This is what Teton County currently levies.
Of that 7%, the first 4 cents are Wyoming’s statewide levy. Roughly 3/4 of that goes to the state, and 1/4 to local government.
The other 3 cents are optional and must be approved by voters. In Teton County, the 5th cent goes into local government’s general operating fund, and the 6th and 7th cents are used for capital projects.
This capital projects tax is called the Special Purpose Excise Tax (SPET), and its revenues are directly matched to specific projects. As a result, when a particular project is completed, the tax lapses.
For example, last year voters approved an $88 million SPET to fund a new Judicial Center. Once the $88 million is paid off, the tax will expire. At that point, it could go away altogether (lowering the sales tax rate to 6%) or be replaced by one of two options: another SPET project, or a general purpose tax (like the 5th cent).
Legally, the Town of Jackson could also ask voters to approve an additional 1% town-only sales tax. That, however, would make goods purchased in town more expensive than the same goods purchased in the unincorporated county, another political non-starter.
The countywide lodging tax could also be raised from its current 5% to as much as 7%. A separate town-only lodging tax of up to 2% is also possible. Both would require voter approval – something which, as discussed above, I don’t think would occur.
Hence, until the current SPET projects are funded and those taxes expire – which will be 2028 at the earliest – the town and county face some interesting financial challenges.
