Nevada state budget (2012-2013)

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See also: Archived Nevada state budgets

The Nevada State Legislature passed five budget bills that fund the state government and education for FY 2012-13 on June 5, 2011, the next to the last day of the regular session.[1] Governor Brian Sandoval signed the budget on June 14, 2011.[2] A summary of the budget as prepared by the state can be found here Assembly Bill 579 provided funding for schools, Assembly Bill 580 contained appropriations for the general fund, Assembly Bill 503 authorized expenditures, Assembly Bill 504 funded capital improvements, and Senate Bill 505 provided state funds to pay bills.[3][4][5][6][7]

Unemployment Insurance

In 2011, Nevada borrowed about $773 million from the federal government to pay jobless benefits. The interest payments on the loans came from the state's general fund.[8]

Interim Funding

At the end of August 2011, the Interim Finance Committee, which functions within the Legislative Counsel Bureau between sessions and administers a contingency fund, met and approved more than 100 requests for funds from nearly every state agency. Interim Finance Committee members expressed concern that issues before the committee in August should had been previously resolved during the budgeting process.[9]

Revenue

In FY 2012, the state transferred $97.4 million from the Unclaimed Property Division to the general fund, the largest such transfer from the Unclaimed Property Division in state history. Property that was unclaimed for three years was transferred to the general fund.[10]

The state faces loss of revenue for a myriad of reasons, including:[11]

  • Tax revenues coming in far below the levels seen in prior boom years;
  • Loss of one-time federal stimulus funds;
  • The expiration on June 30, 2011, of approximately $1 billion in temporary tax increases approved by the 2009 Legislature;
  • End of employee furloughs and restoration of employee benefits that were cut in 2009 to balance the current budget, which together would cost about $500 million.

State Budget Director Andrew Clinger said that the state would be $1 billion short, but that figure did not include the $1.1 billion in lost stimulus funds or $200 million in additional Medicaid costs. The total requests from agencies put the shortfall before any cuts or furloughs at $3 billion.[12]

Gov. Sandoval said that his fiscal priorities were human services and education.[13] He said he would take a salary cut as part of the "shared sacrifice" necessitated by the state's fiscal condition.[13] In addition to cutting his own pay, he said that he wants state workers to give up five percent of their pay.[14] The governor suffered a blow when a Nevada State Supreme Court ruling raised legal issues on some funding tactics totaling about $656 million, which threw the budget process into chaos. The ruling opposed lifting the sunsets on the taxes, which the governor had relied on to avoid new taxes. The court found that it was unconstitutional for the state to sweep $62 million from a southern Nevada clean water fund in 2010 to help pad revenues and close an $805 million deficit. While the decision focused on that money grab, it called into question Sandoval's plan to take school bond reserve accounts and some property taxes from Clark and Washoe counties to help balance his budget.[15]

General Fund revenue collections were $37.99 million ahead of the forecasts used to build the state budget, according to reports presented to the Economic Forum on December 13, 2011.[16]

Education

The governor proposed cutting education spending by $200 million, approximately nine percent. All of the Assembly's Republicans backed the governor's proposed $2.2 billion public school spending plan, while all Democrats opposed the plan.[17]

On May 16, 2011, the governor vetoed Assembly Bill 568, the bill funding K-12 education for 2011-13, because of the funding Democrats added back into those budgets.[18] The funding added by Democrats increased state spending by nearly $660 million above the amount proposed in the Executive Budget and the governor said that the state would not have had the funds to pay for the bill and all other government services if he had signed it. Democrats did not have the votes needed to override the governor's veto, sending the budget battle back to square one with three weeks left in the 2011 session that ended June 6, 2011.[19][20]

Agency budget requests

State agencies submitted their budget requests for the coming biennium in October 2010 and they totaled $8.3 billion, almost $2 billion more than the general fund budget approved by the 2009 Legislature.[21]

Public schools requested a 32 percent increase, upping their share of the total general fund from $2.5 billion this budget cycle to $3.3 billion, as the university system sought a 25 percent increase from $954 million to $1.19 billion. Health and Human Services requested that their budget increase from $1.8 billion to $2.4 billion, an increase of 32.75 percent.[21]

Board of Regents

The Nevada Board of Regents adopted its 2011-13 operating budget without the 10 percent budget cuts requested by the governor. The Board did, however, promise to make the necessary cuts once lawmakers determined the set amount to be cut.[22]

Collective Bargaining

Gov. Sandoval said that he did not support a bill to eliminate collective bargaining in local government as proposed by his predecessor Gov. Jim Gibbons.[23]

References

  1. The Las Vegas Review-Journal, "Legislature approves state funding bills, await Sandoval's signature," June 5, 2011
  2. The Las Vegas Sun, "Sandoval signs budget bills to fund state government," June 14, 2011
  3. Assembly Bill 579
  4. Assembly Bill 580
  5. Senate Bill 503
  6. Senate Bill 504
  7. Senate Bill 505
  8. The Nevada News Bureau, "Nevada Fares Well In 50-State Budget Comparison But Still Faces Fiscal Challenges," Oct. 4, 2011
  9. Nevada News Bureau, "Lawmakers, State Agencies Argue Over Budget Compliance," August 31, 2011
  10. CarsonNow.com, "State Treasurer Announces Record Year For Unclaimed Property Returns To Owners," August 8, 2012
  11. Cite error: Invalid <ref> tag; no text was provided for refs named grim
  12. The Las Vegas Sun, "Numbers tell state budget’s back story," November 17, 2010
  13. 13.0 13.1 Bloomberg, "Nevada gov-elect: Agencies must share pain of cuts," December 30, 2010
  14. CNNMoney.com, "Governors put state jobs on the chopping block," January 27, 2011
  15. Forbes, "Governor, lawmakers huddling over Nevada budget," May 31, 2011 (dead link)
  16. Nevada Appeal, "Nevada was $38M in black," December 14, 2011
  17. The Las Vegas Review Journal, "Parties deliberate proposed cuts to state's schools," April 19, 2011
  18. The Nevada Appeal, "Sandoval vetoes bill adding money to K-12 education," May 17, 2011
  19. KTVN.com, "Governor Sandoval Vetoes K-12 Funding Bill," May 16, 2011
  20. Assembly Bill 568
  21. 21.0 21.1 The Nevada Appeal, "State agencies ask for $8.3B," October 16, 2010
  22. The Reno Gazette Journal, "Nevada regents adopt budget without governor's 10 percent cut request," August 27, 2010
  23. The Las Vegas Sun, "Sandoval won’t push bill to eliminate collective bargaining," February 4, 2011