Posts Tagged ‘Gansert’

Assembly Hears Details Of Sandoval Social Services Program Cuts In Friday Budget Review

By Sean Whaley | 5:57 pm April 29th, 2011

CARSON CITY – The Assembly worked late today meeting as a Committee of the Whole to review Gov. Brian Sandoval’s proposed budget for health and human services.

The review by the entire 42-member Assembly followed a similar session held in the Senate earlier this week.

The review took note of the nearly $50 million in “add backs” by the Sandoval administration to a number of programs run by the Department of Health and Human Services (HHS), including the restoration of $5 per resident day in Medicaid support for elderly Nevadans living in skilled nursing facilities.

Sandoval had originally proposed a $20 per resident day cut in Medicaid funding to skilled nursing providers. The amendment reduces the cut to $15 a day.

Amendments to Sandoval’s two-year, $5.8 billion general fund budget were sent to lawmakers earlier in the week.

In the Senate session on Wednesday, Majority Leader Steven Horsford noted that it will be up to lawmakers to determine where the $50 million in additional funding will be put to use in the budget.

Horsford, D-Las Vegas, questioned whether allocating $2.2 million in scarce funding to keep the Wells Conservation Camp open was a better choice than further restorations to mental health programs.

The funding for the Wells camp has been recommended by Sandoval, prompting Horsford to suggest the add backs are largely aimed at insuring support for the budget from rural Republican lawmakers.

Other restorations proposed by Sandoval include funding for autism, mental health triage centers, mental health residential supports and $2.2 million for elder protective services rather than shifting the cost of this program to the counties.

Even with the program restorations, Democrat lawmakers in the Assembly continued to focus on the cuts that are still part of Sandoval’s budget, such as funding to support the operation of mental health courts.

Sandoval Chief of Staff Heidi Gansert said the mental health courts are not cut in the governor’s budget, but are proposed to be shifted to the counties to fund.

HHS Director Mike Willden said as he prepared his agency’s budget he focused on the retention of core services. The mental health courts, designed to keep mentally ill offenders out of jail, are valuable programs, but the funding from the state does not cover the operation of the courts, he said.

Mike Willden of the Department of Health and Human Services testifies in the Assembly today/Photo: Andrew Doughman, Nevada News Bureau

Instead, the state funding first implemented in 2003 provides psychiatric case workers to work with those with mental health issues in the court system to keep them out of jail and from committing further crimes, Willden said.

If the counties choose not to fund these caseworkers, then the courts could cease to operate, but the individuals would still be eligible for the pool of services available from the department, he said.

Senior Washoe County District Judge Peter Breen testified in support of funding the courts in the Senate and Assembly reviews. He said the program is far cheaper to operate then sending the mentally ill to jail or prison, saving $10 to $12 for every $1 of investment.

Breen called Sandoval’s funding shift a “death sentence” for the mental health courts.

Assemblyman William Horne, D-Las Vegas, said Sandoval has talked of shared sacrifice, but the cuts in his budget will be borne disproportionately by people in need.

Assemblyman Steven Brooks, D-Las Vegas, urged the Sandoval administration to look at Nevada’s antiquated tax system, including the low taxes paid by the mining industry, rather than implementing some of the cuts in his budget.

The proposed budget is being balanced on the backs of those who can’t speak for themselves, he said.

Gansert said the budget will see some further revenues and restorations before it is finalized. The Economic Forum, a panel of private sector fiscal experts, meets Monday and is expected to forecast more tax revenues, she said. A separate review this week of the “minor” state tax revenues has already projected $72 million in additional funds, Gansert said.

 

Assembly Republicans Hold With Gov. Sandoval On Higher Education Budget, Ensuring Funding Impasse Continues

By Sean Whaley | 7:39 pm April 22nd, 2011

CARSON CITY – After a lengthy hearing in the Assembly today on what several witnesses said were the catastrophic effects of Gov. Brian Sandoval’s budget recommendations for higher education, Republican members held firm with the executive branch in a series of funding votes.

The votes came in a meeting of the Committee of the Whole, where all 42 members of the Assembly heard testimony on what higher education officials and supporters said were reductions that would mean closing off access to higher education to as many as 19,000 Nevada high school graduates.

Dan Klaich, chancellor of the Nevada System of Higher Education, talked about the effects of Sandoval’s budget in hearings in both the Senate and Assembly.

Higher education Chancellor Dan Klaich testifies in the Senate today/Photo: Andrew Doughman, Nevada News Bureau

Today he offered an alternative to the Sandoval budget that would increase student fees by 13 percent, require cuts in operating budgets of another 13 percent, and see $100 million in additional revenue from lawmakers. The final element of the plan would restore additional funding in the second year of the budget if the economy recovers and revenues come in higher than projections.

Sandoval’s budget would reduce state funding to the system by $162 million.

Heidi Gansert, chief of staff to Sandoval, and Andrew Clinger, the state budget director, defended the higher education budget and responded to questions at the hearings.

The administration’s position has been consistent: that the key to getting Nevada out of its economic downturn is to create more jobs, and that tax increases would slow any recovery.

The 16 Assembly Republicans held firm with Sandoval in the votes, which included questions about whether to support Sandoval’s proposed higher education budget. The Republican caucus picked up two Democrats in support when the vote was on the question of whether the Assembly should support tuition increases of 10 percent to 15 percent to offset some of the budget reductions to higher education in the Sandoval budget.

Democrats Harvey Munford and Marilyn Kirkpatrick, both from Southern Nevada, voted with Republicans on the tuition question.

Munford, D-Las Vegas, said he thought tuition increases seemed reasonable in light of the state’s financial situation.

“That’s a pretty common practice across the country when you’re short on funds,” he said. “Sometimes finding additional funding requires increasing tuition.”

Kirkpatrick, D-North Las Vegas, also said it seemed as though the Board of Regents would approve a tuition increase of somewhere between 10 to 15 percent anyway.

“I think we are going to end up raising tuition,” she said. “I just hope we can keep the same quality of education as we do that.”

The mostly party-line votes mirrored those in the Assembly on Tuesday, when the subject was the public education budget. The Senate budget hearings did not include votes by the 11 Democrats and 10 Republicans.

Democrats seeking to offset some of what they argue are the worst cuts in Sandoval’s budget need the support of a few Republicans to raise taxes or continue those tax increases approved by the 2009 Legislature that are set to expire on June 30.

Sandoval has been unwavering in his position that he will not raise taxes or fees as part of his two-year, $5.8 billion general fund budget. Democrats need three GOP supporters in the Senate and two in the Assembly to raise taxes and override a Sandoval veto.

In the Senate Committee of the Whole hearing, Sen. Michael Roberson, R-Las Vegas, asked Klaich about his alternative budget proposal: “For argument’s sake, if we need $100 million … where does that come from or where do we cut?”

Klaich replied that the Legislature could mitigate many of the worst cuts, including those proposed for higher education, if it considers extending the 2009 tax increase that is scheduled to end this July.

“We are talking about a budget that is built on giving a tax cut in the upcoming biennium to the largest businesses in the state by allowing the taxes to sunset,” he said.

The 2009 Legislature increased the business tax on the state’s largest employers as part of a tax package to help balance the current budget. Those increases were required to sunset, however, on June 30 of this year.

Sandoval has rejected any suggestion of extending the sunsets to add more revenue to his budget.

The Senate hearing also featured some of the state’s prominent businessmen speaking to the benefits of higher education. They said corporate philanthropy may be in danger if businesses cannot be assured the state views its universities and colleges as long-term, sustainable investments.

Representatives from businesses in the Las Vegas Chamber of Commerce echoed last week’s chamber memo, in which the chamber outlined a plan for reforms to the state’s higher education system paired with a possible tax increase.

Today, a representative from the Henderson Chamber of Commerce made a similar statement.

“Members are almost universally supportive of higher education,” said Kirk Claussen of Wells Fargo and the Henderson Chamber of Commerce. “…If they can be assured that the taxes they are already paying into the state are being effectively and efficiently spent, they are willing to come to the table to talk about additional taxes to help support the system.”

The votes suggest that bringing the 2011 legislative session to a close won’t be an easy task. If an acceptable budget is not in place by June 6, when the session must end, at least one and possibly more special sessions could be necessary, running the budget debate well into the summer.

Nevada News Bureau Intern Andrew Doughman contributed to this report.

 

Senate Debate On Gov. Sandoval’s Public Schools Budget Sees No Vote, Fireworks

By Sean Whaley | 4:29 pm April 20th, 2011

CARSON CITY – The debate over Gov. Brian Sandoval’s proposed cuts to public education shifted to the state Senate today, with members of the upper house getting the details of the reductions that the Clark County schools chief said would mean the loss of $400 million for a 19 percent cut in funding.

But there was no effort by Democrats, who control the Senate with a narrow 11-10 advantage, to force a vote on the schools budget as occurred yesterday in a more contentious Assembly hearing. There were no fireworks either.

The Senate heard from a number of school officials talking about the effects of the cuts proposed in Sandoval’s budget, as well as a defense of the plan from Chief of Staff Heidi Gansert and Budget Director Andrew Clinger.

Sen. Steven Horsford watches as Sandoval Chief of Staff Heidi Gansert and Budget Director Andrew Clinger testify in the Senate today./Photo: Nevada News Bureau

State Budget Director Andrew Clinger and Chief of Staff Heidi Gansert testify in the Senate today as Sen. Steven Horsford watches./Photo: Nevada News Bureau

Clark schools chief Dwight Jones said that if the teachers union does not agree to benefit concessions the district is looking at layoffs of 2,500 to 3,000 employees. Class sizes would also likely increase, by three students in elementary grades and two students in the secondary grades, he said. The textbook and supplies budget would likely see a 50 percent cut as well.

Jones acknowledged, however, that the tough economic conditions facing the state have proved to be an impetus to make reforms to the delivery of education in the district.

Gansert reiterated the Sandoval position that new taxes are not an option for the upcoming two-year budget because of the need to let the economy recover and for Nevada businesses to begin adding jobs.

She noted that the most recent unemployment report for March showed job growth for the first time in 37 months.

Gansert also defended the use of more than $300 million in school district bond reserve funds to fund operating costs for schools, a controversial element of Sandoval’s spending plan for public education. The proposal was put forward to avoid even more severe cuts to public education, she said.

Senate Majority Leader Steven Horsford, D-Las Vegas, started the proceedings for the Committee of the Whole by saying bringing the details of the public education budget to the full Senate is critical to reaching a compromise on spending. He rejected a suggestion that the hearings are a “farce.”

Senate Majority Leader Steven Horsford presides over the Committee of the Whole discussion on public education today/Photo: Nevada News Bureau

“Some in the Legislature have characterized these Committee of the Whole proceedings as a dog and pony show or a farce intended to politically embarrass members of this body,” he said. “Nothing could be further from the truth. The Committee of the Whole in the Senate is about serious business of the state of Nevada that must be resolved.”

Horsford said he cannot accept the education cuts proposed in Sandoval’s two-year, $5.8 billion general fund budget, and that he is willing to compromise. There is no question that any budget approved by the Legislature will include severe cuts to all areas of spending, he said.

“I am prepared to stay here as long as it takes, but I would prefer that we meet our constitutional deadline of passing a budget by June 6,” Horsford said. “That means we must begin working together now to find the common ground and compromises that will allow that to happen.”

In a briefing after the administration presentation, Gansert and Dale Erquiaga, senior adviser to Sandoval, reiterated the governor’s positions on the education budget and taxes.

“We were very careful in putting this budget together, we believe it is sound and it is reasonable,” Gansert said. “We made extra efforts to mitigate the cuts or make them as small as possible to education because that is a priority of the governor’s.”

Erquiaga said that while the administration is interested in reforms sought by Assembly Republicans in such areas as collective bargaining and the prevailing wage, that those issues must be considered on their own merits.

“He certainly welcomes a conversation about reforms, but we need to have a conversation about reforms in this state based on the merits of that proposal, not horse trading,” he said.

The actual level of funding remains a point of contention between Democrats in the Legislature and the Sandoval administration. Democrats say some elements of the proposal are budget cuts, with the governor’s staff disagreeing with the characterization.

Information prepared by legislative fiscal staff provided to lawmakers shows 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 Senate hearing was more subdued that the marathon session in the Assembly that lasted more than six hours Tuesday. The Assembly session deteriorated later in the evening with accusations and complaints levied by members of the lower house at each other.

In the end, Republicans and Democrats remained firmly entrenched in their positions, with the 16 GOP members supporting Sandoval’s budget recommendations and the 26 Democrats seeking some compromise that would require some form of as yet unidentified tax increase.

The Legislature is scheduled to adjourn on June 6.

Audio clips:

Senate Majority Leader Steven Horsford says Committee of the Whole meetings are way to find compromise on budget:

042011Horsford1 :26 must be resolved.”

Horsford says budget compromise will require acting like adults:

042011Horsford2 :29 and trying circumstances.”

Horsford says he will stay in Carson City as long as it takes to find compromise on public school funding:

042011Horsford3 :19 that to happen.”

Clark County schools chief Dwight Jones says Sandoval’s budget means a 19 percent cut:

042011Jones :24 about our work.”

Sandoval Chief of Staff Heidi Gansert says every effort was made to minimize cuts to public education;

042011Gansert :13 of the governor’s.”

Sandoval Senior Adviser Dale Erquiaga says a discussion of reforms is welcome, but not as a trade off for tax hikes:

042011Erquiaga :15 not horse trading.”

 

 

Public Pension Reform Debate To Proceed, But Without Bill From Sandoval Administration

By Sean Whaley | 10:31 am March 29th, 2011

CARSON CITY – Despite citing the need to reform Nevada’s public employee pension plan, Gov. Brian Sandoval did not introduce a bill seeking changes to the retirement system by a deadline Monday.

Even so, Heidi Gansert, Sandoval’s chief of staff, said the administration will “be a part of the conversation” as other measures addressing potential reforms to the Public Employees’ Retirement System are considered in the 2011 legislative session.

“There are other bills that open up that chapter and so we want to be part of that conversation,” she said. “We just could not get agreement on the terms of the bill, and the process was so delayed at getting these bills out, that we ended up deciding we would look for another bill and be part of the discussion.”

Five measures relating to the retirement system for public employees have been introduced this session. One, Assembly Bill 405 by Speaker John Oceguera, D-Las Vegas, proposes to eliminate call-back pay as compensation for retirement purposes for employees hired after Jan. 1, 2012.

Gansert said Sandoval’s original proposal, the details of which were described at a briefing with the press last month, does not have to be the solution to the issue of the retirement system, which faces a $10 billion long-term unfunded liability.

“That proposal was something that we put together looking at what was done in other states,” she said. “But we know there are other ideas out there, so we are willing to talk to everybody about it recognizing that we do have a large unfunded liability and we want to work on that.”

Sandoval said during his campaign he wanted to change PERS for future government hires to make it a defined contribution plan, where employers and employees contribute to retirement but the employees are responsible for managing their funds. This is in contrast to the current “defined benefit” plan where contributions are managed by PERS and the employee is guaranteed a set pension on retirement based on salary and years worked.

In the briefing in February, the proposal being considered by Sandoval would have maintained the current defined benefit system but at about half the contribution rate in effect now, in effect halving the pension payments as well as the future liability to taxpayers. It would have been complemented with a 401(k)-style defined contribution plan that employees could contribute to for a bigger pension on retirement.

The defined benefit plans offered by states and government entities around the country have sparked concern over the potential future liability to taxpayers if there isn’t enough money to pay the benefits. Some plans are much healthier financially than others.

Supporters of Nevada’s current system, which covers virtually all state and local employees, say it is well managed and will be fully funded over time. They argue no changes are necessary.

A recent study by the Pew Center on the States identified Nevada’s public pension plan as one of 19 where “serious concerns” about the long-term health of the plan have been identified.

Nevada’s plan was 70.5 percent fully funded as of June 30, 2010.

Gansert said there are numerous interest groups, including the Las Vegas Chamber of Commerce, which will be involved in the PERS reform discussions as well.

Sandoval has said the public retirement system needs to more closely mirror what is offered by the private sector.

Audio clips:

Chief of Staff Heidi Gansert says the administration will pursue pension reform despite not having its own bill:

032911Gansert1 :16 of the discussion.”

Gansert says the administration will work with the Las Vegas chamber and others on reforms:

032911Gansert2 :14 work on that.”

 

Legislative Democrats, Sandoval Administration Remain At Odds Over State Budget

By Sean Whaley | 4:32 pm March 28th, 2011

CARSON CITY – A two-hour review by the full Senate today of Gov. Brian Sandoval’s proposed two-year, $5.8 billion general fund budget spent a lot of time on what his spending plan could mean well into the future.

A report to the state Senate, meeting as a Committee of the Whole to hear an update on the recommended budget, shows the danger of future budget shortfalls because of the use of one-time funding options by Sandoval to balance the upcoming 2011-13 budget that will start July 1.

The 2013-15 budget faces a nearly $1.1 billion hole because some of Sandoval’s proposed revenues will not recur in future budget years, according to data provided by legislative fiscal staff.

Senate Majority Leader Steven Horsford, D-Las Vegas, said it is not responsible for lawmakers to approve such a budget.

“This governor’s budget creates a $1.2 billion-$1.3 billion hole in the next budget in 2013,” he said. “That is irresponsible of us as legislators to create a hole for another Legislature to deal with.”

The Sandoval administration rejected the criticism, saying decisions have to be made about the budget every legislative session. The analysis was also based on no revenue growth, which is unrealistic.

“There are decisions that will have to be made next time in the budget just like there are every time we put a budget together,” said state Budget Director Andrew Clinger. “So to say that we’re going to have a $1.1 billion hole assumes you make no decisions and change nothing and that the economy doesn’t grow at all. And those are just two assumptions that are just not valid.”

The 2009 Legislature approved temporary tax increases to balance the budget. These expiring increases have contributed to the lower revenue projections for Sandoval’s budget.

Dale Erquiaga, senior adviser to Sandoval, said: “We need for the Legislature to start closing this budget.”

Today’s budget discussion made it clear the Sandoval administration and legislative Democrats, led by Horsford and his Assembly counterpart, Speaker John Oceguera, D-Las Vegas, remain far apart on an acceptable spending plan.

“I’m not prepared to support the level of reductions that are proposed,” Horsford said at the conclusion of the budget review. “I think there is a lot we can still agree on.

“My hope is that as we talk about the cuts that we will have to make, the reforms that we’ve agreed should occur, that we will also talk about the revenue that is needed to responsibly balance this budget,” Horsford said. “And if we can do that in a cooperative way, then we should be able to close down the budget in a timely manner.

“If not, then it is going to mean doing business in a totally different way than we’ve ever done it before,” he said.

Senate Minority Leader Mike McGinness, R-Fallon, said the briefing was helpful but appeared to be designed to put a scare into his colleagues in an effort to advance the premise that additional tax revenues are needed to balance the budget.

“I think it was probably designed to scare us all a little bit,” he said.

Asked if it worked, McGinness said no.

McGinness said his caucus remains firmly opposed to any tax increases, or the continuing of taxes set to expire June 30, to balance the budget.

Sandoval has said repeatedly he will reject any budget that comes to his office with a tax or fee increase.

With Sandoval’s threat of a veto of any budget with tax or fee increases, Democrats in the Legislature face a tough sell to their GOP colleagues to gather enough votes to override a veto. Democrats would need three Republican votes in the Senate, and two GOP votes in the Assembly, to approve tax or fee increases over the objection of Sandoval.

The hole in future budgets was detailed in a report by Russell Guindon, a fiscal analyst for the Legislature, who said tax revenues would have to grow at 12.6 percent in 2014 and 2015 to make up for the loss of the one-time revenues included by Sandoval for the upcoming budget. Such levels of revenue growth are probably not attainable, he said.

Revenue growth for the state budget is officially set by a panel of private sector appointees called the Economic Forum.

One example of the future budget hole is a plan by Sandoval to borrow on the Insurance Premium Tax to generate $190 million to avoid cuts to various health and human resources programs. This would require payments of $53 million over four years starting in 2014 to pay for the revenue option for the upcoming budget.

Another is the proposal to use $300 million in school district bond reserve funds to fund public education operating costs.

Guindon acknowledged that the future budget hole estimated in his analysis would be less if tax revenues grow.

The hearing was cordial but a request by McGinness that Clinger be permitted to testify in the committee hearing was not granted. Clinger would have been able to provide information on a budget amendment submitted to the Legislature earlier in the day showing $120 million more in revenue for the budget than previously estimated, he said.

Horsford said the budget amendment came late and would have to be taken up at a future discussion.

In a statement announcing the revenue increase prior to the Senate budget update, Sandoval said: “I am pleased to announce that this amendment adds more than $120 million in revenue projections – the majority of which I have directed toward K-12 education.”

The budget discussion in the Senate did not include this new revenue, which is coming primarily from adjustments to the Net Proceeds of Minerals Tax and a higher level of federal support for Medicaid based on per capita personal income in Nevada.

The revenue increase does not mean more money in Sandoval’s budget, however. Instead, Clinger said the additional revenue will mean a reduction in the amount of bond reserve funds held by school districts needed to fund public education operating costs for the next two years.

Heidi Gansert, chief of staff to Sandoval, also said the insurance premium tax proposal is a last resort that will be used only if needed. Gansert also questioned the pay-back numbers discussed in the Senate hearing.

There was some modest cause for optimism about the budget. Clinger said he expects the Economic Forum to revise its revenue projections upwards when it meets May 2. Any additional revenue would be used by Sandoval and lawmakers to restore critical cuts to the budget.

Audio clips:

Senate Majority Leader Steven Horsford says the hearing was intended to show the challenges facing lawmakers in balancing the budget:

032811Horsford1 :24 approve this budget.”

Horsford says the budget discussion needs to address new revenues as well:

032811Horsford2 :14 balance this budget.”

Horsford says if Legislature can have an adult discussion with Sandoval on the budget, it will be closed on time:

032811Horsford3 :13 done it before.”

Horsford says Sandoval’s budget creates a huge hole in future budgets:

032811Horsford4 :15 to deal with.”

State Budget Director Andrew Clinger says analysis of future budget hole is unrealistic:

032811Clinger :21 just not valid.”

Senate Minority Leader Mike McGinness says GOP not convinced tax increases are needed:

032811McGinness :08 don’t think so.”

 

Public Pension Reform Details Emerge From Sandoval Administration

By Sean Whaley | 4:32 pm February 28th, 2011

CARSON CITY – Gov. Brian Sandoval will propose a change to the retirement system for new state employees that would reduce their current pension benefits by one half and cut the long-term liability for taxpayers by the same amount, his chief of staff said today.

In a press briefing, Chief of Staff Heidi Gansert offered some details on the reform measure even though it has not yet been drafted for introduction to the 2011 Legislature.

The proposal would maintain the current “defined benefit” plan for new state workers, but at the lower amount. Contribution rates required by the state and new state employees would also be lowered to reflect the reduced benefit. As part of the change, the state would also provide a contribution to a “defined contribution” plan for workers to make up the difference in the lower defined benefit pension amount.

This new defined contribution portion of the plan would help the state financially because it would not create any long-term unfunded liability that taxpayers might end up having to pay. It is more like a 401(k)-type plan found in the private sector.

“So right now the exposure or the risk for the contributions for making the pension plans whole is on the taxpayer, basically,” Gansert said. “And we’re saying it should be shared, and the state exposure for these plans, will be capped at a certain rate.”

Creating a new plan for future hires could cost both the state and current state employees more in the former of higher contribution rates, however.

In a report prepared last year for the PERS board, the Segal Group Inc. said switching to a defined contribution plan for all new hires would require the defined benefit plan for current public employees to be funded more quickly, requiring much higher contribution rates over the next several years. For the state, it would require more funding it does not have.

A few lawmakers are expected to introduce their own reform proposals in the 2011 session.

Assembly Speaker John Oceguera, D-Las Vegas, has a PERS related bill draft request, but Charles Blumenthal, communications director for the Assembly Democratic caucus, said earlier this month it has not yet been decided what reforms, if any, will be pursued with the legislation.

Sandoval, who is in Washington, DC, visiting federal officials and others as part of a National Governors Association conference, has made changing the state retirement plan from a defined benefit plan – which creates a potential future tax liability – to a defined contribution plan – which has no such long-term financial risk to taxpayers – a priority of his administration.

A recent study by the Pew Center on the States identified Nevada’s public pension plan as one of 19 where “serious concerns” about the long-term health of the plan have been identified.

Sandoval has said the public retirement system needs to more closely mirror what is offered by the private sector.

The funding of public pensions is an issue nationally. Many plans are severely underfunded, putting taxpayers potential at risk. Nevada’s plan was 70.5 percent fully funded as of June 30, 2010.

Advocates for the current system say Nevada’s public employee retirement plan is well managed, is being funded appropriately and will be fully funded over time. They say no major changes are necessary.

The plan outlined today by Gansert would take the fundamental shift sought by Sandoval only halfway, and only for state employees. Most state and local government employees are participants of the Public Employees’ Retirement System.

“What it does is it reduces the benefit, which would also reduce the potential liability for the state moving forward,” she said.

The change would not affect the $10 billion long-term liability faced by the retirement system right now for current public employees, but it would lessen the risk moving forward as new state employees are hired, Gansert said.

There were just over 102,000 active public employees participating in the retirement system in fiscal year 2010. Most public employees are eligible to retire with 75 percent of their pay, based on the three consecutive years of highest earnings, after 30 years of employment.

State employees, who currently pay half the contribution rate set by an independent actuary, make up only about 16 percent of the members. Clark County School District employees are the largest group at 31 percent.

Gansert said other public employers could potentially opt to join in with the proposal for new state employees. Sandoval’s proposal would also require all public employees to pay half the contribution rate. Some now don’t pay any.

The current retirement contribution rate is 21.5 percent for most public employees, but the rate is scheduled to jump to 23.75 percent on July 1 of this year. State workers pay half the rate, state agencies and taxpayers pay the other half.

Sandoval’s plan would cut the state required contribution rate to 6 percent for most employees, with another 6 percent coming from the workers for the defined benefit portion of the plan. State employees would then contribute separately to a defined contribution plan with a match of 2 percent by the state.

Police and fire fighters would get a 10 percent contribution rate and be required to pay another 10 percent.

“The current plan needs to be able to fund itself,” Gansert said. “And looking forward to new employees, they will have a lower benefit but they will also have a lower contribution rate.”

Audio clips:

Sandoval Chief of Staff Heidi Gansert says taxpayers now on the hook for public pension plan shortfalls:

022811Gansert1 :14 a certain rate.”

Gansert says Sandoval plan will lower the state liability moving forward:

022811Gansert2 :07 state moving forward.”

Gansert says new state employees will have a lower benefit but a lower contribution rate as well:

022811Gansert3 13 lower contribution rate.”

State Democrat Lawmakers Announce New Job Creation Initiatives

By Sean Whaley | 3:45 pm February 10th, 2011

CARSON CITY – Democratic legislative leaders today announced they will pursue legislation to ensure Nevadans are employed on state or local government public works projects.

The lawmakers plan to introduce a bill implementing that requirement, along with provisions for some materials purchases to be made in state, and the registration of some vehicles to be done in Nevada, in the Assembly on Friday for a hearing Monday in the Government Affairs Committee.

Called “Nevada Jobs First,” the measure would establish a bidding preference for companies using Nevada workers when they bid on government construction projects.

The preference would require a bidder to employ Nevadans for 50 percent of its workforce on a project, require vehicles used in a project to be registered in Nevada, and require 25 percent of materials used for a project to be purchased in state, among other provisions.

“This piece of legislation will give priority on bidding on state and local public works projects in Nevada with Nevada businesses that employ Nevada workers,” said Assembly Speaker John Oceguera, D-Las Vegas. “It is something we can do right away.”

The preference concept is legally defensible, he said.

Senate Majority Leader Steven Horsford, D-Las Vegas, announced another jobs initiative he called the “Nevada Jobs Fund” to put construction industry employees back to work.

“The Nevada Jobs Fund would be an infrastructure capital fund,” he said. “Revenues going into this fund would be used to finance bond issues dedicated strictly to infrastructure projects. Now we’re still finalizing potential sources for the fund, and that will be part of what the committee takes up on the initiative.”

Legislative Democrats were joined by Heidi Gansert, chief of staff to GOP Gov. Brian Sandoval for the announcement, but she did not immediately endorse either proposal, saying they would have to be reviewed first.

Gansert said she was at the event to talk about “Silver State Works,” a component of Sandoval’s economic development plan that would direct $10 million to the employment initiative aimed at training veterans, unemployment benefit recipients, public assistance recipients and ex-offenders for jobs.

Sandoval’s proposal has been endorsed by Democrats, including Horsford.

Sandoval and lawmakers agree job creation is the top priority in the session. There may not be agreement on how to accomplish the objective.

Sandoval is opposed to any tax increases, so the jobs fund described by Horsford would have to find existing revenues to overcome that hurdle.

Horsford’s capital construction fund is similar to a jobs proposal pushed by a coalition of construction industry groups that was discussed Wednesday at a Senate hearing. Several of the more than 100 unemployed construction workers testified at the hearing that too many of Nevada’s public works projects are won by out-of-state companies who do not employ Nevadans.

Dale Erquiaga, senior adviser to Sandoval, today took issue with a statement made at the hearing by Steve Holloway, executive vice president of the Associated General Contractors of Las Vegas. Holloway said Sandoval’s plan to use $425 million in excess school bond reserve funds to help fund school district operating budgets would result in the loss of 5,000 more private sector jobs.

Erquiaga said that statement is incorrect. Sandoval’s plan would not touch the actual monies used in school construction, only the debt reserve account. Those monies cannot be used for construction, he said.

“The construction accounts are kept whole,” he said.

Assemblywoman Marilyn Kirkpatrick, D-North Las Vegas, said three other states have imposed bidder preference requirements being considered by the Nevada Legislature, including Idaho and California. Several other states have some types of preference requirements, she said.

Audio clips:

Assembly Speaker John Oceguera says the bidder preference proposal would put Nevadans to work:

021011Oceguera :18 to the Senate.”

Senate Majority Leader Steven Horsford says the Nevada Jobs Fund would help the hard-hit construction industry:

021011Horsford :19 on the initiative.”

Senate Panel Hears Jobs Proposal, But Call For Tax Increases Faces Opposition

By Sean Whaley | 3:20 pm February 9th, 2011

CARSON CITY – Construction industry groups advocating for a tax increase to fund public works projects around the state to help put people back to work made their pitch to a legislative committee today, but the Building Jobs Coalition proposal faces opposition from Gov. Brian Sandoval.

More than 100 construction workers, some of whom have been looking for work for the past two years, marched around the Legislative Building before crowding into a hearing room to support the plan.

The coalition notes that over the past three years, the construction industry has lost 54,900 jobs in Las Vegas and 12,000 in the Reno-Sparks area.

Sen. Ruben Kihuen, D-Las Vegas, chairman of the Senate Select Committee on Economic Growth and Employment, said at the start of the hearing that creating jobs in Nevada is the No. 1 priority for the 2011 Legislature.

Steve Holloway, executive vice president of the Associated General Contractors of Las Vegas, told the panel the Legislature has the chance to address the underlying economic crisis or “simply exacerbate the problem by applying another short-term fix as was done in the two previous legislative sessions and as the newly elected governor proposed in his State of the State address.”

Holloway said Sandoval’s plan to use $425 million in excess school bond reserve funds to help fund school district operating budgets will conservatively result in the loss of 5,000 more private sector jobs.

But much of the Building Jobs Coalition plan, which calls in part for the creation of a Nevada Job Bonds Support Fund, a stable, dedicated revenue source for capital construction projects, is in conflict with Sandoval’s opposition to any call for new taxes or fees.

The coalition says one option lawmakers should consider for creating such a fund would be a tax increase, either a one-quarter of a cent sales tax, a ten cent property tax levy, or an “infrastructure” surcharge imposed on all licensed vehicles.

When the coalition first released its plan last month, the Sandoval Administration responded: “The governor supports the goal of job creation, but believes it is best accomplished by private sector growth. The strategy of spending public money we don’t have may yield short-term gains for some, but do long-term damage to the economy as a whole.

“Since this is the first we’ve heard of the proposals, we are reviewing them with interest. The governor’s top priority is building and fostering a business environment which creates new jobs without adding to the tax burden or spending money Nevada doesn’t have.”

Most Republican lawmakers are also opposed to any tax increases being considered this session, putting the jobs proposal on a rocky path to success.

Senate Majority Leader Steven Horsford, D-Las Vegas, has embraced the plan, saying it would build on a similar measure passed in the 2010 special session which lifted the sunset on a temporary sales tax increase that was passed by voters in 2002. The revenue projected as a result of the repeal was used to issue bonds to construct public works projects.

Horsford today noted that former Gov. Jim Gibbons, who also advocated against any tax increases in his term, supported the measure.

Horsford said SB5 generated $169 million for 20 infrastructure projects that have created 2,500 private sector construction jobs.

In his opening remarks at the start of the session Monday, Horsford said: “I call on this Legislature to make the Creating Nevada Jobs Initiative a top priority within the first 30 days of this session, and the governor should sign it so we can quickly put as many as 5,000 Nevadans back to work. It can be done.”

Two of the handful of lawmakers who voted against SB5 last year include Sandoval’s Chief of Staff Heidi Gansert, who was Assembly minority leader at the time, and Sen. Don Gustavson, R-Sparks, who was in the Assembly at the time. Gustavson is a member of the Senate select committee.

Some of the projects the coalition says are ready to build include a new county jail for Churchill County at a cost of $50 million, and flood control improvements on the Muddy River in Clark County at a cost of $40 million to $50 million.

The private sector construction industry in Nevada is not expected to recover anytime soon.

Jeremy Aguero, principal analyst with the Las Vegas firm Applied Analysis, told the panel there won’t be another major hotel-casino project built on the Las Vegas Strip for the next seven to 10 years.

Members of the coalition include the Associated Builders and Contractors, the Builders Association of Northern Nevada, Electrical Workers Local 401, the National Association of Minority Contractors and many others.

Audio clips:

Sen. Majority Leader Steven Horsford is urging the Legislature to pass a job creation package within 30 days:

020911Horsford3 :17 can be done.”

Horsford says the select committee is focusing on the critical issue of jobs:

020911Horsford2 :05 back to work.”

Horsford says the Jobs Coalition plan would build on a successful measure from 2010:

020911Horsford1 :24 hit industry, construction.”

Steve Holloway, executive vice president of the Associated General Contractors of Las Vegas, says the Legislature has the chance to address the underlying economic crisis or go for a short-term fix:

020911Holloway :17 the State address.”

Republican State Legislative Leaders Ask For End To Rhetoric From Democrats On Budget

By Sean Whaley | 12:04 pm February 2nd, 2011

CARSON CITY – The Republican minority leadership in the Senate and the Assembly has called on critics of GOP Gov. Brian Sandoval’s proposed budget to trade their “rhetoric for a plan.”

The comments in a letter from Senate Minority Leader Mike McGinness, and Assembly Minority Leader Pete Goicoechea, are in response to criticisms from Democrat lawmakers on various elements of Sandoval’s proposed budget released Jan. 24.

Democrats have not yet offered an alternative to Sandoval’s $5.8 billion general fund budget that includes many program cuts and also shifts the cost of some programs to the counties. Democratic leaders last week said they first have to assess the depth of the cuts in Sandoval’s budget before offering an alternative.

In the letter released Tuesday, the two lawmakers said: “We ask them to join us in supporting the governor’s vision of service before self – a vision that reins in spending, makes government more responsive and calls for shared sacrifice over individual gain.

“We hope they will join us, but should they oppose our efforts to reform government they owe it to you to provide a plan of their own,” McGinness and Goicoechea said. “They owe it to every Nevadan to begin providing specific details of not just their plan, but also how they propose to fund it.

“Nevadans deserve an honest and open debate. We call on Nevada leaders regardless of ideology or party affiliation to spend a little less time on rhetoric and a little more time working together toward real solutions.”

The lawmakers also suggested that Democrats are attempting to mislead the public about Sandoval’s budget.

“Unfortunately some have chosen to dust off an old political strategy designed to confuse the public,” they said. “By presenting a barrage of numbers from a variety of sources, they seek not to advance an agenda of their own but, to confuse the issue.”

Senate Majority Leader Steven Horsford, D-Las Vegas, last week called some of Sandoval’s budget numbers on public education funding misleading and understating the magnitude of his proposed cuts. He called the use of the numbers “trickery.”

Horsford said Sandoval should use the legislatively approved budget as of the 2009 session, not the budget that was changed as a result of further cuts made in the February 2010 special session, for comparison purposes. Sandoval’s budget cuts don’t appear as severe when compared to the further reduced budget as a result of the special session.

Chief of Staff Heidi Gansert said during the hearing last week there was no intent to mislead, only to use the most current budget numbers.

Republican lawmakers are not unified, however, in support of Sandoval’s budget. Long-time state Sen. Dean Rhoads, R-Tuscarora, told the Las Vegas Sun on Tuesday that tax increases may be necessary to balance the spending plan.

He made his comments after hearing the effect of Sandoval’s proposed cuts and program shifts on a variety of critical programs, from mental health courts to child welfare.

Democrats in the Senate would need support from three Republicans to get the 14 votes needed to raise taxes. Assembly Democrats would need the support of two Republicans to get the 28 votes they would need. A two-thirds vote would be required to raise taxes and override a governor’s veto.

Newly elected state Sen. Michael Roberson, R-Las Vegas, has said Horsford does not have the votes in the Senate needed to raise taxes.

His comment came after Horsford in early January sent a letter to supporters and constituents suggesting the next two-year state budget is facing an attack from “extreme right-wing” interests who will use the current economic crisis to “dismantle our state.”

All this has come before the 2011 legislative session even begins. The session gets under way on Monday.

Audio clips:

Senate Majority Leader Steven Horsford says Sandoval administration not being clear about the depth of his budget cuts:

020211Horsford1 :25 bad this is.”

Sandoval Chief of Staff Heidi Gansert says there is no intent to mislead:

020211Gansert :12 in the future.”

Horsford says Sandoval’s budget must be thoroughly reviewed before Democrats can offer any alternatives:

022111Horsford2 :06 do anything else.”

Lawmaker Questions Sandoval Plan To Securitize Insurance Tax

By Sean Whaley | 10:55 am January 25th, 2011

CARSON CITY – A proposal in Gov. Brian Sandoval’s budget to raise $190 million in revenue by securitizing the state’s insurance premium tax was called “questionable fiscal discipline” today by Senate Majority Leader Steven Horsford.

Sandoval Chief of Staff Heidi Gansert said the proposal is a “last resort” to be employed if needed to maintain essential services in health and human services and public education.

Members of the Senate Finance and Assembly Ways and Means committees heard details of the plan today during a budget overview by state Budget Director Andrew Clinger.

Horsford said the proposal would obligate future legislatures to pay back the $190 million plus $24.3 million in interest payments to generate the money for the current biennium. Payments of about $53.6 million would be required starting in 2014 through 2017.

Horsford, D-Las Vegas, likened the proposal to a homeowner securing a home equity line of credit to use to pay ongoing expenses rather than home improvements.

“It’s like taking out a second on my house to pay my bills,” he said. “And I think a lot of families that have done that, we have seen the consequences of that approach and it has put people in bankruptcy. How is this proposal by the administration any different?”

Gansert said the decision to seek the securitization was not Sandoval’s first choice, but was included in the budget to protect critical services. The proposal will restore $119 million in cuts to the Department of Health and Human Services, including $54 million to keep personal care services to help senior citizens on Medicaid stay in their own homes.

Gansert said the plan does not raise taxes or take money out of the private sector. It is a last resort and may not be needed if tax revenues come in above the Economic Forum projections, she said.

“The priority of this administration is to allow the economy to recover and to do that we held the line on taxes,” she said. “Is this ideal, absolutely not.”

Sandoval’s $5.8 billion general fund budget, which does not raise taxes or fees, is designed to keep as much money as possible in the private sector to promote job creation, she said.

Clinger noted the plan represents only 3.2 percent of total general fund spending, “so overall it is a very small percentage of total state general fund resources.”

But Horsford said the proposal “kicks the can completely to the next biennium and that is questionable fiscal discipline.”

Audio clips:

Senate Majority Leader Steven Horsford questions the insurance tax securitization plan:

012511Horsford1 :10 any home improvement.”

Horsford says homeowners have gone into bankruptcy using such practices:

012511Horsford2 :20 administration any different.”

Horsford calls the plan questionable fiscal discipline:

012511Horsford3 :07 questionable fiscal discipline.”

Chief of Staff Heidi Gansert says the plan is not the administration’s first choice and may not be needed:

012511Gansert :11 ideal, absolutely not.”

Sandoval Announces 5 Percent Pay Cut For State Employees Instead Of Furloughs

By Sean Whaley | 5:03 pm January 12th, 2011

CARSON CITY – Gov. Brian Sandoval delivered the bad news in an email to state employees today: His budget will propose a 5 percent across-the-board salary reduction for state employees instead of continuing with a furlough program.

“We must also continue the suspension of merit pay and longevity pay,” he said in the letter.

The change means a slightly larger pay cut than the 4.6 percent reduction in the one-day-a-month unpaid furlough program in the current budget.

“In my meetings with Cabinet officers, I heard consistently that the furloughs are difficult to manage,” Sandoval said. “They result in poor customer service and leave employees with unfinished work that awaits their return after a furlough day. While the 5-percent reduction represents more of a sacrifice than the 4.6 percent, I am hopeful there is a trade-off in workload management.”

Sandoval pledged that he and his staff will take the same 5 percent pay cut.

“I  regret that my first communication with you is to deliver news of this kind,” he said.

Heidi Gansert, chief of staff to Sandoval, said the letter was sent to alert state employees of what is in the upcoming budget to be unveiled Jan. 24.

Besides being difficult to work with, Gansert said the furlough program affects customer service.

“There’s inequity,” she said. “There are some people who take the furloughs and there are others who have been exempted out of the furloughs. This puts everyone on an equal footing.”

Gansert acknowledged that moving to a pay reduction will mean more work and less pay than under the furlough program.

She also acknowledged that the pay cut proposal was not vetted with legislative leadership.

“We had not talked about this specifically,” Gansert said. “The governor had discussed repeatedly in various discussions . . . that we were going to do something that was furlough-like.”

Former Gov. Jim Gibbons also proposed a 6 percent pay cut for state employees in his 2009 budget. The Legislature opted instead for the furlough program.

Sandoval Administration Confirms No Fee Increases In Proposed Budget

By Sean Whaley | 2:24 pm December 22nd, 2010

CARSON CITY – There will be no fee increases of any kind in Gov.-elect Brian Sandoval’s budget when it is presented to lawmakers next year, Chief of Staff Heidi Gansert has confirmed.

“Given the state of our economy, the governor-elect has decided there will be no new fees or taxes in the budget,” she said. “We don’t want any obstacles to an economic recovery. We want as much money as possible spent in the private sector.”

Gansert said Sandoval’s staff is working with Budget Director Andrew Clinger to go through the budget prepared by outgoing Gov. Jim Gibbons in-depth to ensure any fee increases included in the plan are eliminated.

Gansert was asked to comment about the potential of fee increases in Sandoval’s budget after Robin Reedy, chief of staff to Gibbons, said a case could be made to seek fee increases for services provided by the state that are not fully covered by current assessments.

Reedy talked about the potential for fee increases in Sandoval’s budget in an interview Tuesday on the Nevada NewsMakers television program.

Reedy said she believes the next two-year budget can be balanced without new taxes, but added: “A lot of people confuse taxes and fees. And I am not one to say, and this is where the governor (Gibbons) and I do tend to disagree and we have our debates, is a fee is not a tax. If a fee is for a service that is basically helping a segment of either society or business, capitalism means they should pay that cost of doing business.

“So there are fees at the Department of Motor Vehicles and various other areas that deal with either car sales or other areas that are business, that what they pay in fees do not compensate what we pay in salaries and the cost of doing business,” Reedy said. “The government should not be subsidizing any part of the economy.”

Reedy said it will be up to Sandoval and his administration, however, to determine whether to include fee increases in the budget.

But Gansert made it clear that Sandoval’s budget won’t include fee increases.

“We’ve ruled out new fees and taxes,” she said.

Sandoval said in an interview earlier this year that a major focus of his administration will be on job creation to get Nevada’s economy on track, and that any tax or fee increases in his budget would only harm that effort.

“Raising taxes and fees is the worst thing we can do when our economy is struggling,” he said.

Sandoval’s position is at odds with some lawmakers who have suggested tax increases will be needed to balance the state budget.

The National Conference of State Legislatures recently reported that Nevada will have the largest percentage general fund budget gap of any state in both fiscal year 2012 and 2013.

The Nevada Economic Forum projected the state general fund would see $5.3 billion in revenues in the coming two years, well below current spending levels because of the loss of federal stimulus funds and temporary taxes that will expire on June 30, 2011.

Sandoval said after the projection was made Dec. 1 that the revenue level would require agencies to cut $1.2 billion from already reduced budgets submitted this fall to Gibbons.

Audio clips:

Gibbons Chief of Staff Robin Reedy says she believes fees should cover the entire cost of some state services:

122210Reedy1 :29 of doing business.”

Reedy says government should not be subsidizing any part of the economy:

122210Reedy2 :09 of the economy.”

Investigation Of Former Nevada Nuclear Projects Chief Remains Unresolved After Two Years

By Sean Whaley | 8:12 am October 7th, 2010

CARSON CITY – An investigation into the conduct of the former executive director of the Nevada Agency for Nuclear Projects, sought by a state lawmaker after questions were raised about salary increases he awarded himself on the job, remains unresolved after more than two years.

A Nevada News Bureau public records request sent to the Washoe County Sheriff’s Office generated a brief response saying the matter regarding Bob Loux was still under investigation and no information was available for release.

Assemblywoman Heidi Gansert, R-Reno, asked the Nevada Attorney General’s office on Sept. 11, 2008, for an investigation into Loux’s actions for “malfeasance in office and possible criminal activity.”

Due to a conflict, the attorney general’s office asked Washoe County Sheriff Mike Haley to look into Gansert’s concerns.

No results of any investigation have yet been reported by Haley’s office.

Gansert said she does not know why an investigation is taking so long but that it needs to be concluded in an effort to get the salary increases Loux awarded himself repaid to taxpayers.

“It is important that the taxpayers, at the minimum, get their money back,” she said.

Loux gave himself raises that were unauthorized, Gansert said.

The excess salary has not been returned to the state, although Loux’s retirement benefits were adjusted downward to account for the unauthorized pay hikes, she said.

Loux won a state Ethics Commission ruling on the matter, but Gansert said that ruling was based on a technicality.

Loux could not be reached for comment.

Gov. Jim Gibbons called in September 2008 for Loux’s resignation after learning of the salary overpayments, calling the level of mismanagement at the office “severe.” Gibbons said the salary overpayments, which went to other officials in the office as well, came to light when Loux sought funds to cover a shortfall in his budget.

Loux actually served at the pleasure of the Commission on Nuclear Projects, which accepted his resignation in September 2008.

Asked for a comment on the length of the Loux investigation, Gibbons said: “These are the types of situations that erode the public’s confidence in government. The progress of this matter should have been closely monitored by the attorney general to make sure the interests of the people of Nevada are protected.”

Gibbons’ comment prompted a response from Attorney General Catherine Cortez Masto: “Unfortunately, the governor continues to want to play politics with this issue and ignore the facts. Based upon an internal conflict in my office, the case was referred out of my office to an independent law enforcement agency for investigation to protect the integrity of the legal process and the public’s confidence in that process. The very nature of the conflict requires that my office have no further involvement in the case.”

The salary issue went to the state Ethics Commission in March of 2009 based on a complaint also filed by Gansert. The commission ruled 3-2 that because Loux’s salary was actually set by the governor, the allegation he violated ethics laws by exceeding the legislatively approved salary for his office was not at issue.

Loux’s response to the ethics inquiry was that he acted within his authority and responsibility.

Information provided to Ethics Commission staff disclosed that the governor sets the salaries of the commission employees, not the executive director, and that they can be set at any level as long as the total amount in the salary budget category for the agency is not exceeded.

The two dissenting commissioners said the Legislature did set Loux’s salary by reviewing and approving the governor’s recommended budget for the office. They said the question of whether he violated the ethics laws should have been reviewed.

Gansert said the Ethics Commission decision never got to the issue of whether Loux gave himself unauthorized raises at taxpayer expense in violation of the state ethics laws.

According to an Ethics Commission investigator’s report approved Nov. 7, 2008, Loux’s salary was set by the Legislature at $104,497 in 2006 but he was paid $120,537 that year. His salary was set at $108,677 in 2007 but he was paid $125,355. He was authorized a salary of $114,088 in 2008 but received $145,718.

Gansert said the excess pay should be returned by Loux.

Goicoechea Named GOP Assembly Minority Leader

By Sean Whaley | 12:43 pm June 16th, 2010

CARSON CITY – The Republican Assembly Caucus has elected Assemblyman Pete Goicoechea as its new minority leader, replacing the retiring Assemblywoman Heidi Gansert.

Goicoechea, R-Eureka, was the unanimous choice of the 14-member caucus.

Gansert, R-Reno, is not running for re-election to the Assembly.

Republicans are outnumbered by Democrats in the Assembly by a 28-14 margin, the number of votes Democrats need to raise taxes or override a veto by the governor. The Assembly GOP caucus is working to pick up additional seats in the November general election to eliminate this numerical advantage in the 2011 session.

Goicoechea said: “I look forward to working with fellow caucus members to elect additional Republicans to the Legislature, and I am excited to present the GOP case to voters. We’ve got a lot of work ahead of us these next few months and we are determined to get it done.”

Gansert said Goicoechea will be an outstanding leader for the caucus.

Lawmakers Question State Treasurer’s Office Over Financial Health of Millennium Scholarship Fund

By Sean Whaley | 1:45 pm April 29th, 2010

CARSON CITY – When the Legislature adjourned its special session to balance the budget on March 1, lawmakers went home believing they had ensured the financial viability of the Millennium Scholarship program through 2014.

But the program, hit by declining tobacco settlement revenues and the diversion of financial support to help fill a more than $800 million budget shortfall, remains in jeopardy.

The Legislature’s Interim Finance Committee was told today the proposal to use $2 million per year over two years from the College Savings Programs managed by the state treasurer’s office to shore up the scholarship was not approved by the College Savings Programs Board.

Instead, the five-member board approved $200,000 in support for the scholarship program, enough to keep it running only through fiscal year 2011.

Some lawmakers said they were under the impression from Nevada State Treasurer Kate Marshall at the special session that the $4 million would be transferred to the fund. It is legally permissible to transfer funds from the College Savings Programs, which are paid for by families investing in the plans, to the scholarship, which is funded through various state revenues including tobacco settlement funds.

“I can tell you that it was represented during the special session that we were going to have that money transferred and that’s why many of us agreed because we thought the Millennium Scholarship would be solvent, that it was represented by the treasurer’s office that there was the ability to move the money and that it would be solvent,” said Assemblywoman Heidi Gansert, R-Reno.

Senate Majority Leader Steven Horsford, D-Las Vegas, agreed with Gansert that it was represented to lawmakers the money would be transferred to keep the scholarship solvent through 2014.

“That was our expectation and I am sorry the board did not agree with that approach,” he said.

Horsford asked the treasurer’s office to keep lawmakers informed on the financial projections for the scholarship fund so they can be prepared to take action.

“We need to know now where the shortfalls may be so that we can start formulating options for next session,” he said.

Steve George, chief of staff to Marshall, said the college savings board was “vehemently” opposed to the transfer because of concerns about the scholarship’s future. Approving the $200,000 ensures that students receiving the scholarship will get the money next year, he said.

The Legislature in the 2011 session will have to address the future of the scholarship program, George said.

“When it was brought up there was a lot of heated discussion about it and they just weren’t going to go down that path,” he said.

Marshall, who has been criticized by her Republican opponent on the issue, is one of five members of the board, and it was made clear to lawmakers that the full board would have to approve the $2 million transfer, George said.

Minutes of the March 18 meeting of the board show that Marshall said the college savings plan fund could afford to make the $2 million transfer.

Steve Martin, the GOP treasurer candidate and a Las Vegas certified public accountant, criticized Marshall for what he said was her failure to apprise lawmakers of the true financial status of the scholarship program.

Martin said in a campaign statement the scholarship fund is in far greater financial jeopardy than Marshall told lawmakers at the special session. Martin is also a former state controller.

It appears the Millennium Scholarship is approximately $1.6 million short of funding and could be $3.4 million short of projections by June, 2011, he said.

According to Martin, the reason for the shortfall comes from the fact that the tobacco settlement that funds most of the scholarship saw its annual April payment to Nevada come in 10 percent less than projected. If the April 2011 payment is approximately the same as this year, a $3.4 million shortfall will occur before June 2011, he said.

“Why are these true potential deficits finding the light of day only after the special session?” Martin asked.

“Had this shortage been openly and publicly highlighted by Marshall the Legislature may have acted differently,” he said.

The Gov. Guinn Millennium Scholarship program was proposed by former Gov. Kenny Guinn and approved by the 1999 Legislature.

The scholarship, which ranges from $40 to $80 per college credit hour depending on the college attended, is available only to students attending one of the campuses of the Nevada System of Higher Education. The scholarship limit is $10,000.

Students must qualify by earning a high enough grade point average in high school. Students must also maintain a minimum GPA while in college to continue receiving the scholarship.