Posts Tagged ‘Smith’

Nevada Think Tank Says Complicated Public Education Funding Plan Masks Real Per Pupil Spending

By Sean Whaley | 6:01 pm September 12th, 2011

CARSON CITY – So how much are Nevada taxpayers shelling out to educate children attending the state’s 17 public school districts this year?

And if the answer is not easy to ascertain, is it time to consider revising the 44-year old Nevada Plan, the admittedly complex formula used by the Legislature every two years to fund public education?

The Nevada Policy Research Institute, a conservative think tank, recently weighed in on this issue, noting that many people, including policy makers, are either confused or deliberately misleading on the issue of per pupil funding in the public schools.

“To make informed public-policy decisions, taxpayers and policymakers should be aware of what they are really spending to educate children in the Silver State,” said Geoffrey Lawrence, author of the NPRI article called “Confusion is the Plan.”

This chart showing how the Nevada Plan works makes the complexity of the plan clear.

Nevada lawmakers are about to embark on a comprehensive study of public education funding as a result of the passage of Senate Bill 11 from the 2011 session, so there may be the opportunity to bring some clarity to the issue.

Sen. Barbara Cegavske, R-Las Vegas, agrees that Nevada officials should come to agreement on how to calculate per pupil spending. But of greater concern is how the money is spent, she said.

Sen. Barbara Cegavske, R-Las Vegas.

“To even talk about money, to me, is irrelevant,” Cegavske said. “You need to talk about how are we going to better educate kids so they are successful. You can give them a diploma, but if they can’t do the work or they don’t have the strategic intellect that employers look for, what good is spending the money.”

Assemblywoman Debbie Smith, D-Sparks, said while complex, the Nevada Plan has served the state and its students well.

“It’s one of the few areas in the education world where we are acknowledged nationally for our equitable funding plan,” she said.

But the upcoming study will provide an opportunity to review it to see if it needs adjustment, Smith said.

Assemblywoman Debbie Smith, D-Sparks.

The biggest concern in the NPRI article was a suggestion that maybe public schools don’t require the level of funding they now receive based on the per pupil analysis, she said.

“I think public schools in this country are the great equalizer,” Smith said. “I think it is perfectly acceptable for us to look at our funding formula periodically and also to make sure we’re able to talk similarly about the way we explain numbers.”

Crunching the numbers

Lawrence suggests that when all sources of funding are included in per pupil expenditures, the dollars spent are much higher than some would have you believe.

His analysis shows that for the 2011-12 school year, the Clark County School District plans to spend a total of $12,369 per pupil ($9,152 on current expenditures), while the Washoe County School District plans to spend $11,390 per pupil ($10,441 on current expenditures).

This is far more than the average of $5,263 for 2012 and $5,374 for 2013 approved by the 2011 Legislature. This is because the state funding is only one piece of the Nevada Plan funding puzzle. Locally generated property and sales taxes, along with other revenues, add to this total.

The funding process starts with a determination of what level of basic support is needed for each pupil. Then local reviews are estimated to determine how much they will contribute. The state provides the remainder.

But there are also funds that are “outside” the Nevada Plan, including federal funds and school construction spending.

Lawrence says that with a graduation rate of less than 50 percent, taxpayers need to know how much they are spending, and what they are receiving in return. He questioned whether private schools could achieve better results with less funding.

Washoe County Schools Superintendent Heath Morrison, while questioning some of the numbers used in the NPRI article, agrees that Nevada would be better served if everyone could agree on a uniform set of numbers for public education spending.

“Everybody’s got different numbers and everybody is using different numbers,” he said. “And so it really gets complicated in terms of trying to make some baseline comparisons, which I think is really necessary.

Washoe County schools Superintendent Heath Morrison.

“So I applaud NPRI’s article in terms of trying to say, there are a lot of numbers out there and we really ought to use accurate numbers,” Morrison said.

Morrison said it was fair of NPRI to comment on Nevada’s woeful 50 percent graduation rate, but the Washoe district has worked hard on improving that number, which now stands at 63 percent, well above the state as a whole. That number will jump again and get close to the national average of 71 percent when the latest rate is announced Wednesday, he said.

The Nevada Plan has achieved its goals

While admittedly complex, Ray Bacon, executive director of the Nevada Manufacturers Association and a long-time education reform advocate, says the Nevada Plan has worked to equalize funding among the state’s 17 school districts and headed off potential lawsuits that have plagued dozens of other states.

“Is it a perfect formula? The answer is no,” he said. “But it works and it has kept us out of the lawsuit hell since 1967 or whenever it started, and we’re one of the few.

“Does it need to be adjusted? The answer is absolutely,” Bacon said. “Because what the economic situation was in 1967 is not what it is today.”

Where inequities do exist is with the schools within the districts themselves, although the federal No Child Left Behind Act has remedied some of that, he said.

Morrison agrees that the plan has worked as intended to send additional funding to Nevada’s rural school districts, which have expenses despite smaller student populations, from transportation costs to offering comprehensive programs.

But it does not address the more recent reality faced primarily by the two larger urban districts, which is educating children with poverty and mobility issues or who are not English proficient, he said.

“I think the old Nevada Plan probably benefits the rural districts, and I would hate to see that impacted negatively, but it also doesn’t address the huge increase in percentage of kids who come with those additional learning needs and clearly they have resource issues,” Morrison said. “And so as we look at that plan I think that is something that has to be revisited.”

Craig Stevens, director of government relations for the Nevada State Education Association, agreed that the demands for educating Nevada’s urban student population is not adequately addressed by the Nevada Plan.

The upcoming legislative study is the result of a bill sought by the Clark County School District to consider a weighted enrollment formula to take into account the different educational needs of children in the larger districts, he said.

“Not every student is the same and some cost more to educate,” Stevens said.

But the biggest concern the association has with the Nevada Plan is that the funding is like a see-saw – when local funding increases, state funding is correspondingly reduced, he said.

“In the good times and local revenues are up, really and truly unless that overall number – the basic per pupil – goes up, it’s a zero sum game,” Stevens said. “It’s really not taking into account what the economy is doing.”

One point of contention among Nevada officials is whether to count money spent on school construction, or on the repayment of school construction bonds, in the per pupil total.

NPRI included these expenditures as part of the total.

Cegavske said there is no question that these expenditures should be part of the total.

“To take any part of it away, I think, is disingenuous,” she said. “It all comes out of taxpayer dollars and they need to know how that money is being spent.”

Smith agrees the construction money needs to be accounted for, but separately from per pupil spending to evaluate student achievement. Counting construction costs in Nevada, which led the country in growth for 20 years, would not provide a fair comparison to a state that had slow or no growth, she said.

But Lawrence says the cost of buildings and related expenses are factored into the cost of private school tuition, and so should be counted for a fair comparison on the cost of providing an education.

“The costs of constructing a facility, and heating and cooling and everything, they are necessary expenditures for delivering public instruction, unless you’re going to do it outside in the heat, which I don’t think anybody’s advocating for,” he said.


Audio clips:

Sen. Barbara Cegavske says the more important issue is what taxpayers are getting for their money:

091211Cegavske1 :27 spending the money.”

Cegavske says school construction should be counted in per pupil costs:

091211Cegavske2 :17 is being spent.”

Assemblywoman Debbie Smith says Nevada’s public education funding plan has served the state well:

091211Smith :20 one school district.”

Washoe County schools chief Heath Morrison says the NPRI article raises an important issue about finding common ground on reporting per pupil spending:

091211Morrison1 :18 use accurate numbers.”

Morrison says the Nevada Plan does not take into account the cost of educating some students with special learning needs in the larger districts:

091211Morrison2 :20 to be revisited.”

Ray Bacon of the Nevada Manufacturers Association says the Nevada Plan has helped the state avoid education equity lawsuits unlike many other states:

091211Bacon :33 it is today.”

Craig Stevens of the NSEA says the association does not like the Nevada Plan because funding levels do not increase in times of economic growth:

091211Stevens :21 and vice versa.”

NPRI author Geoffrey Lawrence says school construction costs must be included in per pupil funding to provide for a fair comparison with private schools:

091211Lawrence :18 is advocating for.”



Western State Lawmakers, Including Nevadans, Traveling To Hawaii For Annual Conference

By Sean Whaley | 2:57 pm July 22nd, 2011

CARSON CITY – Lawmakers from 13 western states, including some from Nevada, will converge on Hawaii at the end of the month.

But lawmakers won’t be in the tropical paradise to relax or play golf. It’s all about policy and regional issues confronting the states at the 64th annual meeting of the Council of State Governments-WEST. CSG-WEST is a nonpartisan organization that brings Western legislators of both parties together to share best policy practices, cooperate on regional issues and participate in legislative effectiveness training.

Assemblyman Kelvin Atkinson, D-North Las Vegas, is one Nevada lawmaker who will be attending the event. Atkinson is vice chairman of the organization this year, and will serve as chairman in 2013, when the conference that attracts between 1,000 and 1,500 people will be held in Las Vegas.

Assemblyman Kelvin Atkinson will bring the CSG-West conference to Las Vegas in 2013. / Nevada News Bureau file photo

Atkinson said he will be too busy to take in much of Hawaii’s beauty during the event, which will be held in Honolulu from July 30 to Aug. 2.

“I’m vice chair so I probably touch every aspect of the conference,” he said. “Right now on my calendar I probably have 12 or 13 things already I’m going to be doing over there. So I definitely will be going for business.”

The conference is in Hawaii this year because the chairman of CSG-WEST is Hawaii Representative Marcus Oshiro.

CSG-West seems to be popular with Nevada lawmakers because the states that are members share common issues and concerns, Atkinson said. Nevada and other states participate in other organizations as well, including the National Conference of State Legislatures (NCSL) and the American Legislative exchange Council (ALEC).

“So we’re able to talk to each other and get through some of these things,” Atkinson said. “It’s a great networking opportunity for that.”

Nevada lawmakers who decide to attend the conference will either be paying their own way or as representatives of  CSG-West, however. The Nevada Legislature has no funding to pay lawmaker expenses for attending such conferences.

Lorne Malkiewich, director of the Legislative Counsel Bureau, said the Legislature this year did pass a bill to pay the cost of the dues for being members of the three organizations and several others. Assembly Bill 492 allocated $711,000 for Nevada’s dues to the groups for the next two years.

Assemblywoman Debbie Smith, D-Sparks, will be attending as well, although it is not clear how many of Nevada’s 63 legislators will make the trip.

Smith is serving as chairwoman of the Fiscal Affairs Committee, and is also a member of the Executive Committee as well as serving on two other panels.

“I really like the organization,” she said. “They do a lot of good training. On the fiscal side there is a lot of good information about what is going on in other states. They bring in national speakers. I am going to be working very hard.”

Audio clips:

Assemblyman Kelvin Atkinson says he has a full agenda at the upcoming conference:

072211Atkinson1 :17 committee as well.”

Atkinson says Hawaii just happens to be hosting the conference this year:

072211Atkinson2 :22 it just happens.”

Atkinson says CSG-West is popular with Nevada lawmakers because it focuses on Western issues:

072211Atkinson3 :28 opportunity for that.”


Bill Bringing Transparency To State Employee Contracting Wins Final Legislative Approval

By Sean Whaley | 8:53 pm June 6th, 2011

CARSON CITY – A bill aimed at increasing transparency and accountability for state employees working as contractors saw final legislative approval today when the Assembly and Senate reached agreement on compromise language to the measure.

Assembly Bill 240, sponsored by Ways and Means Committee Chairwoman Debbie Smith, D-Sparks, will now go to Gov. Brian Sandoval for his consideration.

There was a bit of drama in the Senate when a vote to adopt the conference committee report resolving differences with the Assembly saw a tie 10-10 vote after Sen. Ben Kieckhefer, R-Reno, expressed some reservations about the effect of the measure on the ability of state agencies to deliver services with a reduced workforce.

“We’re imposing a two-year moratorium for employees exiting state service when we’re about to lay off 600 state and (Nevada System of Higher Education) employees,” he said. “My concern is we will have unintended consequences on this one.”

With Senate Majority Leader Steven Horsford, D-Las Vegas, out of the chambers, Lt. Gov. Brian Krolicki, the president of the Senate, exercised a rare opportunity to vote, and he sided with those rejecting the report, which then failed 11-10.

The drama was short-lived, however, as the Senate reconsidered the report upon Horsford’s return, adopting the report and sending the bill to the governor.

After acknowledging the positive elements of the bill in seeking to eliminate double-dipping by state workers, Kieckhefer decided in the second discussion to support the measure. It then won a unanimous vote from the Senate.

The legislation was prompted by an audit of Nevada state agencies using current and former employees as contractors. It identified numerous potential concerns, including a case of one worker seeking payment for 25 hours of work in one 24-hour day.

The audit also found an example of a current state employee earning $62,590 as a contractor in fiscal years 2008 and 2009 while earning a state salary as well.

The audit identified 250 current and former employees providing services to the state. These employees were paid a total of $11.6 million during fiscal years 2008 and 2009, the years covered by the review.

Smith said the Senate amendment to the bill, and the changes agreed to in the conference committee, strengthen the rules that will govern current and former state employees who work as contractors.

Smith said she sent the bill to conference to address some concerns raised by state Budget Director Andrew Clinger. The main change is to have the information on contracting reported to the Board of Examiners, headed by Sandoval, rather than the Legislature’s Interim Finance Committee, she said.

“We certainly don’t want it to be an impediment; we want it to work; so absolutely we’re good,” Smith said. “It strengthened it because we raised the cooling off period from one year to two years, so we actually strengthened the bill.”

The bill would prohibit a current state employee from being hired under contract by a state agency unless approved by the Board of Examiners. The same approval would be required of a former state employee who has not been out of state employment for at least two years.

Such contracts could only be approved if certain circumstances are found to exist, including situations where a short-term or unusual economic circumstance exists for an agency requiring such employment.

The bill also requires all contracts with individuals entered into by the state or the higher education system to ensure the individuals being hired are in good standing with the secretary of state’s office with regard to business licensing.

Audio clips:

Assemblywoman Debbie Smith says the bill went to conference to address some concerns by Budget Director Andrew Clinger:

060611Smith1 :12 absolutely we’re good.”

Smith said the bill is actually stronger as a result:

060611Smith2 :07 strengthened the bill.”

Performance-Based Budgeting Bill Signed Into Law By Governor

By Sean Whaley | 1:59 pm May 31st, 2011

CARSON CITY – A bill implementing “performance-based” budgeting, including requirements for agencies to set benchmarks and goals and be held accountable for their spending priorities using quantifiable measurements, has been signed into law by Gov. Brian Sandoval.

Assembly Bill 248, sponsored by Assemblywoman Debbie Smith, D-Sparks, and Assembly Speaker John Oceguera, D-Las Vegas, passed both houses of the Legislature in unanimous votes. It was signed into law on Sunday.

The bill is part of a package of Democratic legislation to reform state government to make it more efficient, transparent, and accountable to Nevada’s taxpayers. The new budgeting process would replace the current practice of taking every agency budget approved by the Legislature and adding to it every session to accommodate rising caseloads, inflation and other cost increases.

“Performance-based budgeting is a proven approach to making government more efficient, accountable and making sure every taxpayer dollar is working harder and being spent wisely,” Smith said.

The bill also requires a governor’s budget prepared under the new guidelines to be posted on his official website, as well as on the Department of Administration website, as soon as practicable after the spending plan is transmitted to the Legislature.

The bill takes effect Oct. 1.


Performance-Based Budgeting Bill Wins Approval In Legislature, Heads To Governor

By Sean Whaley | 4:11 pm May 23rd, 2011

CARSON CITY – A bill implementing “performance-based” budgeting, including requirements for agencies to set benchmarks and goals and be held accountable for their spending priorities using quantifiable measurements, passed the Senate today and now heads to Gov. Brian Sandoval.

Assembly Bill 248, sponsored by Assemblywoman Debbie Smith, D-Sparks, and Assembly Speaker John Oceguera, D-Las Vegas, already passed the Assembly.

The bill is part of a package of Democratic legislation to reform state government to make it more efficient, transparent, and accountable to Nevada’s taxpayers. The new budgeting process would replace the current practice of taking every agency budget approved by the Legislature and adding to it every session to accommodate rising caseloads, inflation and other cost increases.

“Performance-based budgeting is a proven approach to making government more efficient, accountable and making sure every taxpayer dollar is working harder and being spent wisely,” Smith said.

In addition to implementing a performance-based budgeting system, AB248 requires the posting of the information about performance on the Department of Administration website, along with report cards on state agencies, to increase transparency.

AB248 further empowers the governor to authorize executive agencies to conduct public hearings on the proposed budget between October 15th and January 15th of the budget cycle, providing additional opportunities for public input and enabling the legislature to have more information when the session convenes.

State Budget Director Andrew Clinger produced Nevada’s first performance-based budget for the current legislative session at the direction of former Gov. Jim Gibbons, along with the traditional budget document, for consideration by lawmakers.

If signed into law, AB248 would mandate the creation of such a budget.



Nevada Budget Gets Funding Boost From Economic Forum, Democrats Say It Isn’t Enough

By Sean Whaley | 8:21 pm May 2nd, 2011

CARSON CITY – Work on closing Nevada’s two-year $6 billion general fund budget will begin in earnest tomorrow after the Economic Forum today finalized its tax revenue projections for the coming two years.

But legislative Democrats and Gov. Brian Sandoval remain far apart on an acceptable spending plan even with a $218 million general fund revenue increase.

The Senate and Assembly money committees have scheduled a joint meeting Tuesday to consider the contentious public education budget now that the tax revenue picture is clear.

At a briefing after the Economic Forum completed its work, legislative Democrats said they will finalize their funding recommendations for public schools at the joint hearing at levels beyond the new forum estimates and beyond what Sandoval has proposed, setting up a showdown over the budget.

Identifying new revenues to fill any resulting funding gap remains a work in progress for Democrats, however.

Senate Majority Leader Steven Horsford, D-Las Vegas, welcomed the news of the enhanced revenue that totals about $274 million, but said it is not enough to fill all the gaps that remain in the budget.

“It is our responsibility as elected officials to lead, and our responsibility to pass a budget that meets our obligations to our students, seniors and to all Nevadans,” he said. “The governor’s budged did not do that yesterday and it does not do that today.”

Other Democrats agreed.

“That’s simply not acceptable,” Assembly Ways and Means Chairwoman Debbie Smith, D-Sparks, said of the level of funding in the public schools budget. “So tomorrow, we will move to close those budgets at an acceptable level.”

Sandoval said in a statement the state economy is too fragile to consider higher taxes: “We must, however, realize that while today’s news is welcome, our state’s economy is still fragile. As the Legislature continues to close budgets, it is of the utmost importance to maintain our business-friendly climate to help foster job growth and put our fellow Nevadans back to work.”

The Economic Forum, a panel of private-sector fiscal experts, raised the outlook for most of the state’s tax revenues after an all-day hearing, with the notable exception of gaming. When all was said and done, the general fund will see just under $218 million in new revenue for the next two years.

Because the panel upped the projection for the state share of the sales tax, the schools share of the tax will also benefit by about $113 million. With a reduction due to property tax calculations, the total new funding is $274 million available to Sandoval and lawmakers as they work to finalize a budget for the two fiscal years beginning July 1.

Sandoval said he wants all of the new funding to go to the public education budget.

Democrats in the Legislature say that the additional revenue is inadequate to fund necessary services for the next two years, leaving Sandoval and Republican lawmakers at odds with their Democrat counterparts.

Democrats do not have the votes, however, to raise taxes without support from Republican lawmakers. It requires a two-thirds vote to raise taxes and to override a veto from the governor.

Sandoval will address the state on television at 6 p.m. tomorrow to make the case for support of his budget with the enhanced revenues. Sandoval has vowed to veto any funding plan that requires new taxes or fees.

Complicating the budget dispute is the time element. The Legislature must adjourn its 120-day session by June 6.

Democrats will soon have to introduce a tax plan in order to fully fund the K-12 budget they will propose tomorrow.

Even with today’s revised projections, the gap between what Democrats want and what the governor proposes is about $1 billion just for the K-12 budget.

Horsford said the first order of business is to finalize the budget and determine what level of new spending is required, but the clock is ticking on a revenue plan. If Democrats can muster support for a tax increase, any such measure would have to be passed by the end of the month in order to have time to override a Sandoval veto.

 Audio clips:

Assemblywoman Debbie Smith says the public education budget will be finalized at an acceptable level:

050211Smith :07 acceptable level, thank-you.”

Senate Majority Leader Steven Horsford says Sandoval budget remains inadequate even with additional tax revenues:

050211Horsford :15 do that today.”

Gov. Sandoval Will Veto School Bond Bill, Expresses Confidence That Medicaid Rate Reductions Are Legal

By Sean Whaley | 11:21 am March 24th, 2011

CARSON CITY – Gov. Brian Sandoval said emphatically today he will veto a bill passed by Democrats in the Legislature that would allow school districts to use up to $300 million in bond reserve funds to rehabilitate older schools.

He also expressed confidence that $60 million in general fund Medicaid rate reductions included in his budget are legally defensible and can be implemented despite a legal opinion to the contrary.

Both issues have the potential to throw Sandoval’s proposed two-year, $5.8 billion general fund budget out of balance.

Sandoval, commenting on the issues after a bill signing ceremony, said he understands the desire of lawmakers and school officials to repair older schools. But Assembly Bill 183, which passed the Senate Wednesday on a party-line 11-10 vote, includes no funding plan, he said.

Sandoval has already included the use of the $300 million in bond reserve funds in his budget to fund school operating costs for the next two years.

“Unfortunately the bill does create a $300 million hole in the budget with no plan to fund that,” he said.

The measure has passed the Assembly and Senate with only Democrats in support, not enough votes to override a veto.

Sandoval said he does not believe his impending veto of the measure will sour his relationship with Democrats, who control both the Assembly and Senate.

“We’ve had conversations about that and I think there was an understanding that I had a different position on that bill,” he said.

Following the Senate vote, Assemblywoman Debbie Smith, D-Sparks, said: “I know the governor wants to create jobs in Nevada. I know he wants to improve education in Nevada, and I know he has seen first-hand the horrible condition of many of our older schools, so I urge him to sign ‘School Works’ and help us save these crumbling schools, create jobs and uphold the will of the voters.”

The proposed Medicaid reductions to health care providers came under scrutiny in the Legislature on Wednesday when lawmakers were given a legal opinion suggesting the cuts would violate federal law.

Health and Human Services Director Mike Willden said however, he believes the cuts can be implemented for the two-year budget.

Sandoval said he is relying on Willden’s assessment of the budget proposal.

“He’s very confident that there hasn’t been anything that would violate the law,” Sandoval said. “We’re very confident that we’re within the boundaries of the law.”

Audio clips:

Gov. Brian Sandoval says he will veto the schools bill because it creates a hole in his budget:

032411Sandoval1 :06 to fund it.”

Sandoval says he is relying on HHS Director Mike Willden’s assurances that the Medicaid cuts are proper:

032411Sandoval2 :08 violate the law.”

Sandoval says he is confident the Medicaid cuts are legal:

032411Sandoval3 :04 of the law.”

Sandoval says his impending veto of the school construction bill will not sour his relationship with Democrats:

032411Sandoval4 :06 on that bill.”

Nevada Policy Makers Remain Divided On Future Of Public Employee Pension Plan

By Sean Whaley | 4:12 pm December 20th, 2010

CARSON CITY – Nevada policy makers remain divided over the need to make a fundamental change to the public employees’ retirement system following the release last week of a report showing significant costs to move to a defined contribution plan.

Some lawmakers say they have not yet read the report by the Segal Group Inc. which says it would cost about $1.2 billion over the next two years to change from the current defined benefit plan to a defined contribution plan for new state and local government workers. These additional costs would continue for several years.

Lawmakers on both sides of the issue say they need more information and expect to hear more details of what such a shift would entail in the upcoming legislative session.

Gov.-elect Brian Sandoval continues to favor a change to a defined contribution plan for new government hires, but has not yet reviewed the study in-depth, said spokeswoman Mary-Sarah Kinner.

She said Sandoval expects to meet with the staff of the Public Employees’ Retirement System after taking office in January.

“Gov.-elect Sandoval remains committed to the concept of defined contribution as discussed in the campaign,” Kinner said.

Assembly Minority Leader Pete Goicoechea, R-Eureka, said he believes the retirement system will have to be changed over to a defined contribution plan, but that he needs more details on how such a change would be accomplished.

The price tag just for the next two years gives him concerns as well.

Goicoechea said if the contribution rates have to be increased significantly for current public employees to fully fund the current pension plan within about a decade, it could be a big hit to workers as well.

Contribution rates, which now are shared by employers and employees, are set to increase over the next two fiscal years to keep the current defined benefit plan financially healthy. Rates will go up to 23.75 percent from 21.5 percent now for regular employees.

But to fund the plan more quickly, the rate would have to increase to 34 percent instead, according to the Segal report.

For police and firefighters, who are analyzed separately, the increase would go from the proposed 40 percent contribution rate over the next two years to 52 percent.

The cost of these increases would total $1.2 billion for the coming two years, and would continue until the closed defined benefit plan was fully funded.

If these increases are shared by workers, it would mean a significant pay cut, Goicoechea said. It could also lead to a mass exodus of current employees who are eligible for retirement, he said.

Goicoechea says he does favor changing to a defined contribution for new hires.

“But I want to see some more on the plan before I really step out there,” he said.

Assembly Speaker John Oceguera, D-Las Vegas, said he does not believe a major change to a defined contribution plan is necessary. But there is no question that the long-term unfunded liability of the current plan, which hit $10 billion as of June 30, needs to be paid down, he said.

“If we can reduce that unfunded liability portion by whatever method, then I think we ought to look at that,” he said. “I don’t think we ought to change the way we do it though, the system we have.

“Getting to 100 percent funded is a good cause, and I think we should try to do that,” Oceguera said.

Senate Majority Leader Steven Horsford, D-Las Vegas, said he could not comment because he has not yet read the report.

Senate Minority Leader Mike McGinness, R-Fallon, favors a change to a defined contribution plan for new hires but said he has not read the Segal report and so could not yet comment on the findings.

Assemblywoman Debbie Smith, D-Sparks, chairwoman of the Ways and Means Committee, said the report indicates what other such studies have said previously, that it would not be fiscally prudent to change the pension plan from a defined benefit to a defined contribution plan.

The Legislature has been attempting to address the unfunded liability, although budget problems in recent years have made that more difficult to accomplish, she said. It will be up for discussion at every legislative session, Smith said.

“I think the public employee benefit plans will certainly be under scrutiny; and making sure we have plans to fund them,” she said.

The 2009 Legislature did make some changes to the retirement plan for new hires in an effort to reduce costs, including increasing the retirement age to 62 for some workers.

The report released Dec. 15 says that to change to a defined contribution plan for new hires, the existing defined benefit plan will have to be fully funded over a shorter time frame, requiring increased contribution rates from the state and local governments and possibly employees as well.

A change from a “defined benefit” plan where retirement payments are guaranteed based on salary and years worked, to a “defined contribution plan” where public employers contribute to employee retirement without any guarantees of pension amounts upon retirement, is being pushed for public employee retirement plans nationwide.

Such a change would affect only future hires. There is a current legal prohibition for changing the plan for workers currently in the system.

Advocates for the current system say Nevada’s plan is well managed, is being funded appropriately and will be fully funded over time. Supporters of a change to defined contribution say it would eliminate any future unfunded liability and so benefit taxpayers.

Audio clips:

Assembly Minority Leader Pete Goicoechea says changing the public employee retirement system could have a big financial impact on state and local governments and employees:

122010Goicoechea1 :07 a tremendous impact.”

Goicoechea says a change to the system could generate a large number of retirements:

122010Goicoechea2 :09 until July 1.”

Assembly Speaker John Oceguera says lawmakers should work to close the unfunded liability rather than make sweeping changes:

122010Oceguera1 :13 that we have.”

Oceguera says getting the current plan 100 percent funded is a worthwhile goal:

122010Oceguera2 :04 to do that.”

Assemblywoman Debbie Smith says budget problems have delayed legislative action on the unfunded liability:

122010Smith :14 plate every session.”

Lawmakers Support Expansion of Nevada Legislature As Part Of Redistricting In 2011

By Sean Whaley | 4:15 pm July 21st, 2010

CARSON CITY – Several Nevada lawmakers serving on a panel gearing up for the critical task of redrawing the state’s political boundaries in 2011 said today they support expanding the size of the Legislature to provide better representation.

Sen. Bill Raggio, R-Reno, said the Legislature should have added more seats to the Senate and Assembly in the 2001 redistricting process. Because Southern Nevada’s population has boomed for most of the decade, more legislative seats will move south from rural and northern Nevada unless more seats are added, he said.

This makes it almost impossible for some lawmakers to properly represent their districts, both because of the overall population growth and because some rural districts are geographically immense, Raggio said.

“They are not really manageable,” he said. “So you need to increase the size so that you don’t have districts with geographical areas that are just impossible or impractical for one person to represent.”

The Nevada Legislature has 21 state senators and 42 members in the Assembly for a total of 63 lawmakers. The state constitution limits the size of the Legislature to a maximum of 75.

Currently 14 of 21 senators are from Clark County. Twenty-nine of the 42 members of the Assembly are from Clark County.

Raggio said he believes the Legislature should consider expanding all the way to the full 75 allowed, with 25 members in the Senate and 50 members in the Assembly.

Raggio will be involved in the redistricting process but he won’t be crafting a Senate district for himself. The 2011 session will be his last.

Assemblyman Pete Goicoechea, R-Eureka, and Assemblywoman Debbie Smith, D-Sparks, said they too support an expansion of the Legislature when interviewed after the meeting of the Legislative Commission’s Committee to Study Requirements for Reapportionment and Redistricting.

Goicoechea said at least two Assembly seats and one Senate seat need to be added in the 2011 legislative session. The Assembly Republican Caucus will push for that, he said.

Goicoechea said he would also like to see districts more closely mirror county lines where possible. Several rural Nevada counties have multiple legislative representatives right now, he said.

Smith said she believes more seats are needed to ensure adequate representation outside of Clark County. In the 2001 redistricting process, two Assembly seats and one Senate seat went south from Washoe County to compensate for the population growth. Smith saw her own district carved up as part of that process.

Smith lost re-election in 2002 following the redistricting by the 2001 Legislature. She was re-elected in 2004 and has served ever since.

Smith said the cost of an expansion would not be that great because the legislative building can accommodate more members.

Smith said she is not certain yet on how much of an expansion would be appropriate.

Redistricting occurs one every 10 years following the census count.

The Legislature must redraw their own districts to make them approximately equal in size. They will also redraw the state’s congressional boundaries. Given Nevada’s population growth since the last census, the state will likely expand to four seats in the House of Representatives from the current three seats.



Sen. Bill Raggio on need to expand size of Legislature:

072110Raggio1 :23 not very representative.”

Raggio on some districts being too large to represent:

072110Raggio2 :26 person to represent.”

Assemblywoman Debbie Smith on concerns about representation:

072110Smith :8 means to representation.”

Legislative Panel Begins Review Of State Agency Budgets Without Cooperation From Governor

By Sean Whaley | 9:32 am July 8th, 2010

CARSON CITY – An effort by the Nevada Legislature to undertake a fundamental review of several state agency budgets with an eye to improving efficiencies and saving money began yesterday without support from Gov. Jim Gibbons or his staff.

The first meeting looked at two programs: the Parole and Probation Division and the building lease program administered by the Division of Buildings and Grounds. The six-member Legislative Committee for the Fundamental Review of the Base Budgets of State Agencies conducted the review without administration officials present at the meeting, however.

State employees were following the directive of Gibbons in a letter sent to lawmakers Friday saying executive branch staff would not participate in the review. Gibbons has questioned the motives of the committee and cited the separation of powers doctrine as reasons for his directive to staff not to participate.

Legislative leadership from both parties sent a letter to Gibbons last month citing state law that requires participation by administration staff. The issue remains unresolved, however.

Despite the apparent lack of cooperation, the panel voted to send an inquiry to the agencies on the agenda to answer several follow-up questions raised by the information prepared by legislative staff. The panel also voted to request the presence of several administration officials at the next meeting.

Assemblywoman Debbie Smith, D-Sparks, said the requests are being made by the panel without any indication yet if the executive branch staff will respond or attend the next meeting.

Smith said there is no desire on the part of the Legislature to engage in a protracted legal battle with Gibbons, who is leaving office in January. Legislative leadership, in its letter sent to Gibbons in June, said the panel could subpoena administration officials but Smith said lawmakers are dealing with the impasse, “one day at a time.”

Even so, Smith said she was disappointed and frustrated by Gibbons’ decision, noting that a lot of time could have been saved if administration officials had been present at the meeting to answer questions.

“Just a conversation at the table could have solved a lot of issues here today, just as we see at any other hearing,” she said.

Senate Minority Leader Bill Raggio, R-Reno, said he is disappointed at Gibbons’ decision not to cooperate with the review. In all his years of legislative service with six different governors, there has always been a willingness by the executive branch to work cooperatively with lawmakers in between legislative sessions, he said.

Lynn Hettrick, deputy chief of staff to Gibbons, said the panel is not doing a real fundamental budget review but instead is “nitpicking little bits here and little bits there.”

Finding savings within the agencies reviewed today would have a miniscule effect on the $3.5 billion hole the state faces in the next two-year budget cycle, he said.

“We ought to be looking at things that truly are a fundamental budget review about how can we fix the issues that we have facing us,” Hettrick said. “To us this is a waste of time right now.”

Hettrick said the request by the panel to have staff testify and provide more information for the next meeting will be reviewed.


audio clips:

Assemblywoman Smith on Gov. Gibbons’ decision not to participate in the review process:

070710Smith :15 of staff time.”

Sen. Raggio on failure of Gibbons to cooperate with lawmakers:

070710Raggio :33 of these efficiencies.”

Hettrick says panel’s efforts a waste of time:

070710Hettrick1 :11 balance a budget.”

Hettrick says state faces a $3.5 billion budget hole:

070710Hettrick2 :18 balancing the budget.”

Member of Vision Stakeholder Panel, Lawmaker, Raise Open Meeting Law Concern

By Sean Whaley | 7:32 pm May 17th, 2010

CARSON CITY – A member of the citizen’s panel appointed by lawmakers to chart Nevada’s future for the next 20 years expressed concern today about whether the process to be followed to complete the effort conforms to meet the requirements of the state Open Meeting Law.

Doug Busselman, executive vice president of the Nevada Farm Bureau Federation, said he would like guidance from the Legislative Counsel Bureau on the decision to have the consultant preparing the final Nevada Vision Stakeholder Group report confer with members individually as part of the process of completing the panel’s charge.

The stakeholder group has met several times since January in open meetings, with posted agendas, to prepare its report for the Legislature’s Interim Finance Committee. The group was expected to finish its work Friday, but Busselman said the 19 voting members of the panel were not satisfied with a draft report prepared by the consultant, Moody’s Analytics. The draft report was made available to the public before the meeting.

Busselman said the intent of the outreach effort by the consultant is to give each member of the group the opportunity to discuss what should be included in the final report.

“Having said that, I personally am not completely comfortable with how that fits within the context of the state’s Open Meeting Law,” he said. “I’m hoping we might get some further direction from legislative counsel on how that activity might be conducted appropriately.”

“I’m not an expert on the Open Meeting Law,” Busselman said. “I know enough to have concerns over whether or not this process fits the full letter and intent of what is intended to be an open discussion.”

Busselman said he does not know if other panel members have similar concerns. But the work of the panel should not be opened up to potential criticism for the way it was completed, he said.

Assemblyman James Settelmeyer, R-Gardnerville, said a constituent who listened to the Friday meeting contacted him to express concern about the process.

“It is my sincere hope that the Vision Stakeholder Group will not only hold true to the letter of the Open Meeting Law, but its spirit and intent and do everything in an open manner,” Settelmeyer said.

Peter Bernhard, a Las Vegas attorney and member of the panel representing the Cleveland Clinic Nevada, agreed there should be no suggestion that the panel’s work is being done in private. But Bernhard said his understanding at the end of the meeting was that members would be asked to respond to a matrix developed by the consultant rather than through one-on-one contact.

“None of us liked the idea of telephone calls,” he said. “The matrix would get uniform responses from us. It is a more efficient way to get the information.”

Bernhard said the matrix would be made available to the public. Any responses provided by panel members would also be made public at its next meeting.

Alan Feldman, representing the gaming industry on the panel as an executive with MGM Mirage Inc., said the discussion at the Friday meeting was how to finish the report within the time allotted without violating the Open Meeting Law.

The conclusion was that interaction between the consultant and individual panel members to get clarity on the various issues was appropriate as long as there was no polling or voting by members in those discussions, he said.

“Obviously none of us are interested in violating the Open Meeting Law,” Feldman said. “I would have shared Doug’s concern had we not been very clear.”

Feldman said at the next meeting of the panel there will be a public discussion and vote up or down on each section of the report and then a public vote on the complete report.

“We still have a lot to do,” he said. “We have put a lot of work into this.”

The group is now expected to meet once more in June. The work of the panel and the report from Moody’s is due to the Legislature’s Interim Finance Committee by July 1. Moody’s is being paid $253,000 for the work.

Lawmakers will then take the information and use it to craft a strategy to deal with the next two-year budget, which could have as much as a $3 billion hole.

Jan Gilbert of the Progressive Leadership Alliance of Nevada, which has been following the efforts of the Vision Stakeholder Group, said she does not see a problem with the consultant having discussions with individual members as long as there is a public discussion on the final report afterward.

“I would have preferred that they hammer it out in public,” Gilbert said. “They will never get a unanimous decision on this. Nineteen people were too many to begin with.”

Gilbert said she was not terribly impressed with the draft report released prior to Friday’s meeting.

“We know we need to diversify the economy,” she said. “We know we need to provide essential services.”

Barry Smith, executive director of the Nevada Press Association, said as long as the results of any such individual discussions are disclosed at a public meeting, it does not appear to be an open meeting law concern.

The panel was created by the Legislature independently of Gov. Jim Gibbons after a measure creating a tax and revenue study was vetoed by the governor in the 2009 session. Gibbons said such a review would inevitably lead to a call for new taxes.

The draft report, which was rejected by the panel, included a discussion on taxes but did not include any specific recommendations.

The draft report said Nevada should: “Stabilize government program fund­ing levels by diversifying the tax base, using alternatives to general funds to support public investments, expanding rainy-day funds and securitizing future revenue streams.”

Last week Gibbons said the ongoing tax discussions are hurting Nevada’s economy.

The uncertainty of what will happen with regard to taxes in Nevada in the 2011 legislative session is keeping businesses from relocating to the state, he said.

“It is harming the state’s ability to recruit businesses to Nevada,” Gibbons said.

Dan Burns, communications director for Gibbons, said the panel is misnamed and should be called the “Tax Hike Study Committee.”

Both businesses that are already here as well as those thinking about relocating are concerned about the tax discussion, he said.

“Restructuring to broaden the tax base is code talk for a modified business tax, a gross receipts tax, a higher sales tax,” Burns said.

The committee should be looking at how to save money, not raise taxes,” he said. “Raising taxes will delay the recovery.”

Lawmakers supportive of the study of the state’s revenue structure said there is no preordained plan to use the report to call for higher taxes.

Busselman said he does not see the stakeholder group as being charged with recommending tax policy.

“My understanding of the process was we are responsible for creating the vision of what we thought Nevada should grow up to become,” he said.

The Legislature would then take up the policy issue of taxes, Busselman said.