Posts Tagged ‘Andrew Clinger’

State Board Settles Tax Dispute With Washoe County For $7.25 Million

By Sean Whaley | 5:16 pm September 11th, 2012

CARSON CITY – The state Board of Examiners today voted to settle a legal dispute with Washoe County over local tax revenue taken by the 2009 Legislature to balance the state budget.

The settlement provides an immediate payment of $1.25 million to the county, with another $6 million being allocated later for major road maintenance projects. As part of the agreement, the road projects will be moved up in the state’s funding priorities.

The original legal claim submitted in 2011 was for $21.4 million, but the county later revised its demand downward to about $17.9 million.

Gov. Brian Sandoval, a member of the board, called it a good deal for the state since the projects to be paid for with state highway funds have already been approved for funding by the state Transportation Department. The agreement also makes it clear there is no admission by either side that there is fault or a legal liability for the settlement, he said.

The cash portion of the settlement equates to about seven cents on the dollar, Sandoval noted.

If the highway piece of the settlement is included, the deal provides about 40 percent of what the county had sought in its revised request, said state Budget Director Jeff Mohlenkamp.

“It’s a good settlement and I think it’s important to recognize, as I said, that there was no admission of liability by either party,” Sandoval said after the meeting. “I don’t think it’s ever a good idea to be having litigation or disputes between governmental entities.”

Washoe County submitted the claim last year, citing a Nevada Supreme Court ruling in May 2011 that said the Nevada Legislature improperly took $62 million in 2010 from the Clark County Clean Water Coalition fund to balance the state budget. The county said the ruling applied to actions taken by lawmakers in 2009 as well.

Clark County has also submitted a claim based on the same legal decision, and is seeking $102.5 million in local taxes also taken by the 2009 Legislature. But the county in June opted to sue rather than continue with negotiations.

Even so, Sandoval said today that negotiations continue with the county to resolve the dispute, which occurred prior to his term as governor.

But the state has just recently received a new claim, from the city of Reno, based on the same Supreme Court ruling.

Reno City Manager Andrew Clinger appeared before the board to briefly discuss the claim filed for $2 million. The settlement with Washoe County approved today did not provide any direct benefit to the city, he said.

Reno City Manager Andrew Clinger.

Sandoval said the claim will be reviewed by the Attorney General’s Office as has been done with the other requests.

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Audio clips:

Reno City Manager Andrew Clinger says the city has also submitted a claim:

091112Clinger :24 aware of that.”

Gov. Brian Sandoval says the settlement is a good deal for the state:

091112Sandoval :28 between governmental entities.”

Governor Estimates $656 Million Lost In Budget Due To Supreme Court Decision

By Andrew Doughman | 11:54 pm May 26th, 2011

CARSON CITY — The state’s budget just took a $656 million hit, according to members of Gov. Brian Sandoval’s staff.

Following a Supreme Court decision earlier today, the governor convened the press at 11 p.m. to outline his opinion of how the decision effects funding streams used in the state budget.

“The problem is much worse than we thought,” said Dale Erquiaga, the governor’s senior adviser.

Erquiaga, Andrew Clinger and Lucas Folleta, the governor’s budget director and legal counsel respectively, would not speculate as to how they will replace the dollars they assume are lost in the state’s proposed two-year budget.

This morning, the court ruled in the Clean Water Coalition case that the state government could not take $62 million in local revenues to bolster the state budget.

Later this afternoon, Sandoval said he believed the case could have wide-reaching implications for his proposed general fund budget.

“The ruling raises questions about certain assumptions in the proposed executive budget, despite some having been used in the past,” he said in a statement. “As a former federal judge, I am cognizant of the legal issues.  As governor, I am forced to deal with their ramifications and I am responding by reworking the state budget.  I will announce a revised plan on Friday.”

Erquiaga said that the governor has kept legislative leaders appraised of the situation.

Erquiaga also said the governor and his staff plan to work throughout the night to find a solution to replace the lost revenue.

The governor, however, has already announced that he is considering extending taxes that are set to expire June 30. Doing so would bring the state an estimated $712 million, enough to offset the reductions due to the court decision.

In addition to the $62 million, the governor is assuming $594 million in lost revenue.

“The court’s decision forced us with this decision,” Folleta said.

The decision holds that the state cannot siphon money from a local funding stream, thus making the Clean Water Coalition money grab unconstitutional.

The governor’s staff spent the late afternoon and evening evaluating where the money in Sandoval’s budget is coming from and arrived at a “conservative” decision that the court’s ruling could endanger five other revenue sources.

“To take a less conservative approach, if the state were sued, revenue streams will have to be backed out,” Erquiaga said.

In addition to the $62 million lost due to the court’s decision, the governor’s office assumes these revenue sources would be lost if challenged in court:

  • Supplemental account for medical assistance to indigents: $38,427,584
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  • Transfer from school districts’ debt service reserves: $247,420,312
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  • 4 cent Clark and Washoe counties operating property tax: $52,994,482
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  • 2.6 cents in fiscal year 2012 and 2 cents in fiscal year 2013 in Clark and Washoe counties capital projects property tax rate: $30,475,264
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  • Room tax dollars: $225,455,400

In Late Night Hearing, Assembly Caught Up In Education Funding Numbers Game

By Andrew Doughman | 10:37 pm April 19th, 2011

CARSON CITY – The Assembly was awash with numbers tonight.

As part of the Democratic strategy to close the budget, the Assembly as a whole discussed for four and a half hours the education budget so that all legislators could learn about the cuts.

Legislative staff presented to the Assembly more than $1 billion proposed “major reductions” to school districts. These numbers come from a variety of sources:

  • $600 million from freezing teachers’ pay increases, reducing salaries by 5 percent and making teachers contribute more to their retirement plans.
  • $238 million from the governor’s direct reductions to state support for public schools.
  • $221 million of room tax money continues to shift from supporting schools to the state general fund, as it does in the current budget.

The governor has also proposed to use $301 million in districts’ bond debt reserves for day-to-day expenses. School district representatives argue that this equates to an additional cut.

For legislators who do not sit on fiscal committees, the hearing in the Assembly chambers allowed them to ask questions about the education budget and education policy.

What ensured was a semantics game.

Gov. Brian Sandoval’s budget director, Andrew Clinger, said that a $141 million pay freeze does not equate to a reduction and the $221 million room tax is already diverted to the state budget this year.

Assemblywoman Debbie Smith, D-Sparks, contended the pay freeze was a reduction.

Clinger said shifting $301 million from debt reserves to day-to-day expenses was not a cut.

Smith said it was.

The confusion, however, did not end there.

Assemblywoman Marilyn Dondero-Loop, D-Las Vegas, asked how much money the state would cut per student. That ever elusive “per pupil spending” number was no easier to find this evening.

“It really depends on who you ask,” Clinger said. “Depending on what your source is, you’re going to get a different answer.”

Depending how one cooks the numbers, those estimates can vary by thousands of dollars. But boiled down, the proposed budget would allot $315 less per student than it currently does.

Smith asked Washoe County Superintendent Heath Morrison whether he thought sweeping districts’ bond reserves should be called a “cut.”

“The semantics of ‘is it a cut?’ Here’s what I know: It hurts the Washoe County School District,” he said.

Republicans, however, contended that school districts could make the cuts hurt less through changes to state government.

Assemblymen Pat Hickey, R-Reno, and Mark Sherwood, R-Las Vegas, suggested that school districts suspend prevailing wage – a requirement to pay a certain wage for public works projects – in an attempt to help districts save money.

Assemblyman Mark Hammond, R-Las Vegas, who is a teacher at a Las Vegas school, said he would like to see principals have more control over funds that come to their schools.

Assemblyman Crescent Hardy, R-Mesquite, said the Legislature should change collective bargaining rules so districts can drive a harder bargain for contracts with teachers and administrators.

Morrison contended this would not help. He said teachers and administrators have agreed to cuts in the past.

“I did not see collective bargaining as a problem,” he said. “I did not see anything but cooperation and support.”

Smith also said that reform is not the issue.

“We do need reform and we are working on reform,” she said. “But we also need to adequately fund our education system.”

Through the semantics squabbles and policy debates, a partisan bent seemed to triumph.

Democrats said there was too little in the governor’s $5.8 billion budget to help Nevada out of the recession.

“The elephant in the room is that we have a revenue problem rather than a spending problem,” said Assemblyman Joseph Hogan, D-Las Vegas.

Republicans said Sandoval’s budget is just right.

“The governor is trying to restore the economy,” said Assemblyman Pete Livermore, R-Carson City. “If you’re going to tax people out of their businesses and out of their homes, how can you restore the economy?”

 

 

 

 

 

 

Governor’s Budget Juggling Results In Less Money For Emergency Repairs At Schools

By Andrew Doughman | 7:14 pm March 3rd, 2011

CARSON CITY – The governor has proposed taking funds school districts are using for emergency repairs to help balance the state budget.

School districts have said this would leave them with little money to fix broken boilers and leaky roofs or perform other emergency repairs.

“We don’t have any money set aside right now to cover those expenses if the governor’s proposal moves forward,” said Craig Hulse from the Washoe County School District before a Senate committee reviewing the governor’s proposal.

The revision to the governor’s budget comes after a meeting between the governor’s staff and school district officials yesterday.

The proposal shifts $319 million from the districts’ debt-service funds to the districts’ operating funds, which is the main account used to fund the operation of schools.

This, however, involves dipping into the bucket of money that school districts use for emergency repairs.

Sen. Michael Schneider, D-Las Vegas, said this was a bad idea. He said that some of the schools in his district have portables that are in “horrible shape.” He called them “rat traps.”

“My message to the governor’s staff is: find some other way to balance your budget,” he said to Andrew Clinger, the governor’s budget director.

A month ago, the governor had tried to balanced his budget another way. Gov. Brian Sandoval had initially proposed letting school districts keep a six-month reserve rather than a 12-month reserve to pay off bonds. This would free up $425 million for school district operating costs.

But school districts later told the Legislature that it could not pay $425 million.

So Clinger brought back a revised proposal.

It is that new proposal that shifts money out of school districts’ emergency repair funds.

Those funds comes from the Governmental Services Tax fund that school districts collect. In the Clark County School District, this equates to a shift of $20 million per year out of that fund.

That would leave $5 million per year for emergency repairs.

The state would shovel its share into the districts’ debt service fund.

The governor’s proposal means juggling money from one account to another. The governor would instruct the school districts to pay for the operating costs of schools with their debt-service fund, then to pay for debt-service with their emergency repair fund. This leaves a shortfall in the emergency repair fund.

Proposal punches $106 million hole in budget

The proposal also leaves the governor $106 million short in his budget, one that Clinger said will not go away until May.

Sandoval had originally planned of using $425 million from the districts’ debt-service funds to pay for schools.

Since his staff has trimmed those prospects to $319 million, that leaves a $106 million gap between the money available and the money that governor wants to spend for his budget.

Clinger reassured legislators that a revenue forecast in May would show increases that would lower that $106 million shortfall.

He is betting on promising sales tax returns as well as a proposal from President Barack Obama to defer interest payments on federal loans Nevada has used to pay unemployment insurance benefits.

That is an extra $66 million that could be added back into the budget to reduce the $106 million gap.

For some Senators, Clinger’s reassurance was not enough. Sen. Steven Horsford, D-Las Vegas, said he does not want to wait until a May revenue forecast to discover a $106 million hole exists or not.

“I am extremely disappointed. The state cannot wait until May to make decisions about how we’re going to fund education, health care and public safety,” he said.