Nevada state budget

From Ballotpedia
Jump to: navigation, search
Nevada state budget

Flag of Nevada.png
Budget calendar:  Biennial
Fiscal year:  2014-2015
State Credit Rating:  AA (as of May 2012)
Current Governor:  Brian Sandoval
Financial figures
GF expenses[1]:  $3.2 billion
All funds expenses:  $8.9 billion (FY 2013 estimate)
Spending % Change:  up[2]
% from Federal Funding:  25.48%
State Debt:  $52,838,629,000
Per Capita State Debt:  $19,152
Other state budgets
AlabamaAlaskaArizonaArkansasCaliforniaColoradoConnecticutDelawareFloridaGeorgiaHawaiiIdahoIllinoisIndianaIowaKansasKentuckyLouisianaMaineMarylandMassachusettsMichiganMinnesotaMississippiMissouriMontanaNebraskaNevadaNew HampshireNew JerseyNew MexicoNew YorkNorth CarolinaNorth DakotaOhioOklahomaOregonPennsylvaniaRhode IslandSouth CarolinaSouth DakotaTennesseeTexasUtahVermontVirginiaWashingtonWest VirginiaWisconsinWyoming
This page contains information about budget processes and policy issues in Nevada, including:
  • A summary of the budget drafting process
  • Trends in expenditures and revenues
  • Current and past fiscal year budget developments
  • Financial transparency measures

Between fiscal year 2009 and fiscal year 2013, Nevada's total expenditures increased by approximately $600 million, from $8.3 billion in 2009 to $8.9 billion in 2013. This represents a 6.7 percent increase, below the cumulative rate of inflation during the same period (9.06 percent, calculated using the Consumer Price Indices for January 2009 and January 2013).[3][4]

Budget process

The state operates on an biennial budget cycle that starts July 1 of each biennium. The sequence of key events in the budget process is as follows:[5][6]

  1. Budget instruction guidelines are sent to state agencies in January.
  2. Agencies submit their requests to the Governor in August.
  3. Agency hearings are held in September and December.
  4. The Governor submits the budget to the Nevada State Legislature in January.
  5. The Legislature passes a budget in May or June. A simply majority is needed to pass a budget.

The Governor is required by statute to submit a balanced budget. In turn, the Legislature is constitutionally required to pass a balanced budget.[6]

Expenditures

Definitions

Although each state executes its budget process differently, the National Association of State Budget Officers (NASBO) breaks down state expenditures into four general categories. This allows for comparisons among the 50 states. NASBO's categories are as follows:[7]

  • General fund: "The predominant fund for financing a state’s operations. Revenues are received from broad-based state taxes. However, there are differences in how specific functions are financed from state to state."
  • Other funds: "Expenditures from revenue sources that are restricted by law for particular governmental functions or activities. For example, a gasoline tax dedicated to a highway trust fund would appear in the “Other funds” column. For Medicaid, other state funds include provider taxes, fees, donations, assessments, and local funds."
  • Federal funds: "Funds received directly from the federal government."
  • Bonds: "Expenditures from the sale of bonds, generally for capital projects."

2013 expenditures

Breakdown of expenditures in FY 2013.
Source: National Association of State Budget Officers

The table below breaks down expenditures for fiscal year 2013 (comparable figures from surrounding states are provided to give additional context).[7] Figures for all columns except "Per capita expenditures" are rendered in millions of dollars (for example, $2,448 translates to $2,448,000,000). Figures in the column labeled "Per capita expenditures" have not been abbreviated.

Total state expenditures, FY 2013 ($ in millions)[7]
State General fund Federal funds Other funds Bonds Total Per capita expenditures**
Nevada $3,179 $2,918 $2,769 $27 $8,893 $3,187.30
California $95,665 $81,299 $38,656 $12,261 $227,881 $5,944.85
Oregon $5,960 $7,452 $12,262 $132 $25,806 $6,566.30
Washington $15,633 $7,744 $7,809 $2,016 $33,202 $4,762.60
**Per capita figures are calculated by taking the state's total expenditures and dividing by the number of state residents according to United States Census estimates.[8][9]
Source: National Association of State Budget Officers

Expenditures by function

Breakdown of expenditures by function in FY 2012.
Source: National Association of State Budget Officers

State expenditures in Nevada can be further broken down by function (elementary and secondary education, public assistance, etc.). Fiscal year 2012 data is included in the table below (information from neighboring states is provided for additional context). Figures are rendered as percents, indicating the share of the total budget spent per category.

Expenditures by function, FY 2012 (as percents)[7]
State Elementary and secondary ed. Higher ed. Public assistance Medicaid Corrections Transportation Other
Nevada 23.6% 9.7% 3.2% 25.4% 3.8% 9.5% 24.9%
California 19.9% 7.0% 3.8% 21.6% 5.4% 6.3% 36.0%
Oregon 14.0% 2.5% 0.7% 18.2% 3.9% 6.7% 54.1%
Washington 22.9% 17.8% 1.0% 12.1% 2.7% 8.4% 35.1%
Source: National Association of State Budget Officers

Expenditure trends

From 2008 to 2012, expenditures on higher education, corrections and transportation decreased by less than two percent. During the same time period, expenditures on elementary and secondary education, public assistance and Medicaid increased by as much as 13.1 percent on Medicaid and as little as 2.6 percent on public assistance. The table below details changes in expenditures from 2008 to 2012.[7][10][11][12][13] Figures are rendered as percents, indicating the share of the total budget spent per category.

Expenditures from 2008 to 2012 (as percents)
Year Elementary and secondary ed. Higher ed. Public assistance Medicaid Corrections Transportation Other
2012 23.6% 9.7% 3.2% 25.4% 3.8% 9.5% 24.9%
2011 21.5% 10.0% 0.7% 18.3% 3.5% 9.5% 36.5%
2010 21.5% 10.8% 0.7% 18.3% 3.9% 11.4% 33.5%
2009 20.6% 9.6% 0.7% 14.7% 5.2% 16.5% 32.6%
2008 16.6% 11.0% 0.6% 12.3% 4.2% 11.4% 44.0%
Change in % 7.00% -1.30% 2.60% 13.10% -0.40% -1.90% -19.10%
Source: National Association of State Budget Officers

Revenues

2013 revenues

Breakdown of general fund revenue sources in FY 2013.
Source: National Association of State Budget Officers

The table below breaks down general fund revenues by source in fiscal year 2013 (comparable figures from surrounding states are also provided to give additional context).[7] Figures for all columns except "Per capita revenue" are rendered in millions of dollars (for example, $2,448 translates to $2,448,000,000). Figures in the column labeled "Per capita revenue" have not been abbreviated.

Revenue sources in the general fund, FY 2013 ($ in millions)[7]
State Sales tax Personal income tax Corporate income tax Gaming tax Other taxes and fees Total Per capita revenue**
Nevada $919 $0 $0 $705 $1,463 $3,087 $1,106.40
California $20,240 $63,901 $7,509 $1 $6,544 $98,195 $2,561.66
Oregon $0 $6,300 $500 $0 $496 $7,296 $1,856.46
Washington $7,656 $0 $0 $0 $8,116 $15,772 $2,262.38
**Per capita figures are calculated by taking the state's total revenues and dividing by the number of state residents according to United States Census estimates for 2013.[8]
Source: National Association of State Budget Officers

Revenue trends

The table below details the change in revenue sources in the general fund from 2009 to 2013.[7][10] Figures for all columns except "Per capita revenue" are rendered in millions of dollars (for example, $2,448 translates to $2,448,000,000). Figures in the column labeled "Per capita revenue" have not been abbreviated.

Revenue sources in the general fund, Nevada ($ in millions)[7][10]
Year Sales tax Personal income tax Corporate income tax Gaming tax Other taxes and fees Total Per capita revenue**
2013 $919 $0 $0 $705 $1,463 $3,087 $1,106.40
2012 $876 $0 $0 $686 $1,520 $3,082 $1,118.96
2011 $826 $0 $0 $684 $1,665 $3,175 $1,168.16
2010 $784 $0 $0 $668 $1,555 $3,007 $1,112.37
2009 $860 $0 $0 $692 $1,188 $2,739 $1,036.29
Change in % 6.86% N/A N/A 1.88% 23.15% 12.71% 6.77%
**Per capita figures are calculated by taking the state's total revenues and dividing by the number of state residents according to United States Census estimates.[8][9]
Source: National Association of State Budget Officers

State budgets by year

DocumentIcon.jpg See budget bill: Legislatively Approved Budget 2013-2015

Biennium 2014-2015

Nevada state budget -- 2014
Nevada State Legislature
Text:SB 475 (This is one of five major budget bills that comprise the 2014-2015 biennium budget)
Legislative History
Introduced:March 25, 2013
State House:June 3, 2013
Vote (lower house):35-6-1
State Senate:June 3, 2013
Vote (upper house):17-3-1
Governor:Brian Sandoval
Signed:June 12, 2013

The Nevada State Legislature approved a $6.6 billion budget for the 2014-2015 biennium. The budget included most of the recommendations submitted by Governor Brian Sandoval, such as adding money for public schools and early development learning and restoring a 2.5 percent state employee pay cut. It was the first increase in funding for schools since the 2009 recession.[14]

The approved budget was comprised of five major budget bills. Outside of education funding, the general appropriations bill laid out $4 billion for the General Fund for the biennium, with $1.98 billion for the first year and $2.02 billion for the second.[14]

Biennium 2012-2013

See also: Nevada state budget (2012-2013)

Biennium 2010-2011

See also: Nevada state budget (2010-2011)

Historical spending

State budget historical spending below was compiled by the National Association of State Budget Officers. Figures reflect the reported "Total Expenditures" in Table 1. Figures for all columns are rendered in millions of dollars (for example, $2,448 translates to $2,448,000,000).[7][11]

Historical state budget spending in Nevada ($ in millions)
Fiscal year General Fund Other funds Federal funds Bonds Budget totals
Total % of Budget Total % of Budget Total % of Budget Total % of Budget
2011-2012 $3,062 40.2% $1,978 25.9% $2,554 33.5% $29 0.4% $7,623
2010-2011 $3,175 37.2% $2,631 30.9% $2,642 31% $78 0.9% $8,526
2009-2010 $3,018 36.4% $2,365 28.5% $2,792 33.7% $109 1.3% $8,284
Averages: $3,085 38% $2,324.67 29% $2,662.67 33% $72 1% $8,144.33
General Fund: The predominant fund for financing a state’s operations. Revenues are received from broad-based state taxes. However, there are differences in how specific functions are financed from state to state.
Other funds: Expenditures from revenue sources that are restricted by law for particular governmental functions or activities. For example, a gasoline tax dedicated to a highway trust fund would appear in the “Other funds” column. For Medicaid, other state funds include provider taxes, fees, donations, assessments, and local funds.
Federal funds: Funds received directly from the federal government.
Bonds: Expenditures from the sale of bonds, generally for capital projects.

State debt

According to a January 2014 report by the nonprofit organization State Budget Solutions, Nevada had a state debt of over $52 billion. Its state debt per capita was $19,152. The report revealed that state governments faced a combined $5.1 trillion in debt, 33 percent of annual gross state product. The obligation amounts to $16,178 per capita in the nation. A bulk of the state debt -- 79 percent -- was linked to unfunded public pensions.[15][16]

Total state debt in Nevada[17]
Type Totals U.S. rank
Total state debt $52,838,629,000 27
Per capita debt $19,152 13
State and other fund expenditures $5,040,000,000 1

Public pensions

See also: Nevada public pensions and Nevada public employee salaries

A 2012 report from the Pew Center on the States noted that Nevada's pension system was funded at 70 percent at the close of fiscal year 2010, below the 80 precent funding level experts recommend. Consequently, Pew designated the state's pension system as cause for "serious concern."[18]

Taken together, the funding ratio for the state's pension systems decreased from 77.30 percent in fiscal year 2007 to 70.97 percent in fiscal year 2012, a 6.33 percent drop. Likewise, unfunded liabilities increased from approximately $6.3 billion in fiscal year 2007 to $11.2 billion in fiscal year 2012.

Credit ratings

States sometimes sell general obligation bonds to investors in order to finance large-scale undertakings (e.g., road construction and other public works projects). Credit rating agencies, such as Standard and Poor's, assign grades to states, evaluating their ability to pay the principal and interest on such bonds. Standard and Poor's grades range from AAA, the highest available, to BBB, the lowest. Generally speaking, a higher credit ranking indicates lower risk for an investor, which in turn lowers costs for taxpayers.[19]

The table below lists the Standard and Poor's credit ranking for Nevada from 2001 to 2012 (grades from surrounding states are provided for additional context).[19]

S&P credit ratings from 2001 to 2012
Nevada California Oregon Washington
2012 AA A- AA+ AA+
2011 AA A- AA+ AA+
2010 AA+ A- AA AA+
2009 AA+ A AA AA+
2008 AA+ A+ AA AA+
2007 AA+ A+ AA AA+
2006 AA+ A+ AA- AA
2005 AA A AA- AA
2004 AA A AA- AA
2003 AA BBB AA- AA+
2002 AA A AA AA+
2001 AA A+ AA AA+

Federal aid to state budget

See also: Federal aid to budgets in the 50 states

The chart below notes how much of the state’s general revenues come from the federal government. Figures were calculated by dividing each state’s federal intergovernmental revenue into its general revenue. The number in the rightmost column indicates the state's ranking in relation to the rest of the nation (e.g., if "1," the state receives the highest percentage of federal funding in the nation). Figures from neighboring states are included to provide additional context.[20]

State governments receive aid from the federal government to fund a variety of joint programs, such as Medicaid. Federal aid varies considerably from state to state. For example, Mississippi received approximately $7.7 billion in federal aid in 2012, which accounted for more than 45 percent of the state's general revenues. By contrast, Alaska received roughly $2.9 billion in federal aid in 2012, just under 20 percent of the state's general revenues.[20]

Federal aid to state budgets in 2012
State Federal aid as % of general revenue Total federal aid National rank
Nevada 25.48% $2,798,426,000 44
California 27.17% $54,145,284,000 40
Oregon 36.09% $7,830,552,000 12
Washington 28.59% $9,743,127,000 37

Stimulus

Nevada received $2.35 billion in federal stimulus funding from the American Recovery and Reinvestment Act between February 2009 and June 2013.[21]

Budget transparency

Transparency evaluation
Nevada Open Government
Searchability Y
600px-Yes check.png
Grants N
600px-Red x.png
Contracts N
600px-Red x.png
Line item expenditures Y
600px-Yes check.png
Dept./agency budgets Y
600px-Yes check.png
Public employee salaries N
600px-Red x.png
Last evaluated in 2009.
See also: Evaluation of Nevada state website and Constitutional provisions regarding reading of bills

Nevada Open Government hosts the state's searchable online database of financial data. The site was created by Governor Jim Gibbons's executive order and became functional on January 15, 2009.

Government tools

The Nevada Open Government website provides line item expenditures navigable by fiscal year and agency. Budget documents are also available.

The table to the right is helpful in evaluating the level of transparency provided by Nevada Open Government.

Limitations and Suggestions

The site lacks information on grants, contracts, and state employee salaries.

Independent transparency sites

The Nevada Policy Research Institute developed its own transparency website, TransparentNevada.com.[22] This site focused primarily on local transparency, complementing the state's site, which focuses primarily on state spending transparency.

Multi-measure budget transparency profile

The Institute of Government and Public Affairs at the University of Nevada created a multi-measure transparency profile for Nevada, which measured state transparency as of September 2011 using indicators from a range of organizations. These indicators measured both website transparency and other recognized facets of governmental transparency. In addition, IGPA presented four unique indicators of non-transparency based on the observation that transfers or reassignments between general and special funds can obscure the true fiscal condition of a state.[23][24]

IGPA devised a budget transparency index based on information available from the National Association of State Budget Officers. Nevada tied for 20th in the nation with 12 other states, earning five out of eight possible points.[24]

Nevada - IGPA score for budget process, contents and disclosure
Budget transparency indicator Yes or no?
Performance measures
{{{1}}}
"Generally Accepted Accounting Principles" budget N
600px-Red x.png
Multi-year forecasting
{{{1}}}
Annual cycle N
600px-Red x.png
Binding revenue forecast
{{{1}}}
Legislative revenue forecast
{{{1}}}
Non-partisan staff
{{{1}}}
Constitution or statutory tax/spend limitations N
600px-Red x.png
TOTAL 5

In addition to the individual state profile, IGPA offers a 50-state comparison and profiles for other states.[24]

U.S. PIRG "Following the Money" report

See also: Following the Money 2014 Report

The U.S. Public Interest Research Group, a consumer-focused nonprofit organization based in Washington, D.C., released its annual report on state transparency websites in April 2014. The report, entitled "Following the Money," measured how transparent and accountable state websites are with regard to state government spending.[25] According to the report, Nevada received a grade of D- and a numerical score of 52, indicating that Nevada was "lagging" in terms of transparency regarding state spending.[25]

Accounting principles

See also: Nevada government accounting principles

The Nevada Legislative Auditor audits Nevada's state agencies and publishes audit reports online. The Legislative Auditor is a statutory officer appointed by the Director of the Legislative Counsel Bureau with the approval of the Legislative Commission for an indefinite term whose qualifications and duties are defined by law. The Legislative Auditor serves as staff to the Nevada State Legislature and its various committees, and was the chief of the Audit Division.[26]

The Institute for Truth in Accounting (IFTA) rated Nevada “timely” in filing the state’s Comprehensive Annual Financial Report (CAFR) – the annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and six states as worst. IFTA did not consider Nevada's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis did not include significant liabilities for the pension plans and for other post employment benefits, such as health care.[27] Nevada's CAFRs are prepared and published online by the Nevada Controller's Office. They can be found here.

The Nevada Controller is one of the six constitutional officers of the state and is elected to a term of four years. The Controller is the chief fiscal officer charged with administering the state accounting system and the state's debt collection program under the Nevada Constitution Article 5, Section 19.[28]

Credit Ratings

Credit Rating Fitch Moody's S&P
Nevada[29] AA+ Aa2 AA[30]

Moody's downgraded the state from Aa1 to Aa2 in 2011, citing two-thirds supermajority required to raise taxes as a negative in Nevada.[31]

Contact information

Department of Administration Budget Division
209 East Musser Street, Room 200
Carson City, Nevada 89701-4298
Phone: 775-684-0222
Fax: 775-684-0260

See also

External links

Additional reading

References

  1. Refers to General Fund spending. Typically in state budgets the General Fund is spending that is most directly controlled by state legislators.
  2. This figure is derived by calculating the percent difference between the prior two years' spending levels according to the National Association of State Budget Officers.
  3. Bureau of Labor Statistics, "CPI Detailed Report Data for February 2014," accessed April 9, 2014
  4. InflationData.com, "Cumulative Inflation Calculator," February 28, 2014
  5. National Conference of State Legislatures, "State Experiences with Annual and Biennial Budgeting," updated April 2011
  6. 6.0 6.1 National Association of State Budget Officers, "Budget Processes in the States, Summer 2008," accessed February 21, 2014
  7. 7.0 7.1 7.2 7.3 7.4 7.5 7.6 7.7 7.8 7.9 National Association of State Budget Officers "State Expenditure Report, 2011-2013," accessed February 21, 2014
  8. 8.0 8.1 8.2 United States Census Bureau, "Annual Estimates of the Resident Population: April 1, 2010 to July 1, 2013," accessed February 26, 2014
  9. 9.0 9.1 United States Census Bureau, "Vintage 2009: Annual Population Estimates," accessed February 26, 2014
  10. 10.0 10.1 10.2 National Association of State Budget Officers, "State Expenditure Report, 2009-2011," accessed February 24, 2014
  11. 11.0 11.1 National Association of State Budget Officers, "State Expenditures Report, 2010-2012," accessed February 24, 2014
  12. National Association of State Budget Officers, "State Expenditure Report, 2009," accessed February 24, 2014
  13. National Association of State Budget Officers, "State Expenditure Report, 2008," accessed February 24, 2014
  14. 14.0 14.1 Elko Daily Free Press, "Legislature approves $6.6B Nevada budget," June 5, 2013
  15. State Budget Solutions, "State Budget Solutions' Fourth Annual State Debt Report," January 8, 2014
  16. Washington Examiner, "EXography: Unfunded public employee pensions drive state debts skyward," January 21, 2014
  17. State Budget Solutions "State Budget Solutions' Fourth Annual State Debt Report," January 8, 2014
  18. Cite error: Invalid <ref> tag; no text was provided for refs named nevadapew
  19. 19.0 19.1 Stateline: The Daily News Service of The Pew Charitable Trusts, "Infographic: S&P State Credit Ratings, 2001-2012," July 13, 2012
  20. 20.0 20.1 United States Census Bureau, "State Government Finances: 2012," accessed February 24, 2014
  21. Recovery, "Stimulus Spending by State"
  22. Nevada Policy Research Institute, "New Transparency Website Launched," September 8, 2008
  23. Institute of Government and Public Affairs at University of Nevada, "Home page," accessed February 21, 2014
  24. 24.0 24.1 24.2 Institute of Government and Public Affairs at University of Nevada, "Budget Transparency Profiles - All 50 States," September 2011
  25. 25.0 25.1 U.S. Public Interest Research Group, "Following the Money 2014 Report," accessed April 15, 2014
  26. Nevada Legislative Audit Division Website, accessed October 31, 2009
  27. Institute for Truth in Accounting, “The Truth About Balanced Budgets—A Fifty State Study,” Page 35
  28. Nevada State Controller's Office Website, accessed October 31, 2009
  29. State of Indiana, “State Credit Ratings," June 24, 2009
  30. Pew Stateline Infographic on State Credit Ratings, accessed September 27, 2013
  31. Nevada News Bureau, "Moody’s Downgrades Nevada’s Credit Rating," March 24, 2011