Posts Tagged ‘state budget’

Nevada Agencies Request $6.46 Billion In New Budget, Up $279 Million From Current Spending Plan

By Sean Whaley | 1:02 pm October 15th, 2012

CARSON CITY – Nevada’s next two-year general fund budget would grow by $279 million to $6.46 billion based on the initial spending requests submitted by state agencies, information released today by the Budget Division shows.

State Budget Director Jeff Mohlenkamp, who will continue to piece together Gov. Brian Sandoval’s final recommended 2013-15 budget through at least December, said the increase in spending is due primarily to the growing public education and Medicaid populations. The public education piece is estimated at $18 million. The Medicaid population increase is expected to cost $104 million.

State Budget Director Jeff Mohlenkamp. / Nevada News Bureau file photo.

The budget is still subject to a variety of revisions by Sandoval between now and January when it is released to the public and lawmakers. The final budget will depend greatly on available tax revenue, which will be set by the state Economic Forum in early December.

“We’re wrestling quite a few different variables that all have to be factored in before ultimately those decisions are made,” Mohlenkamp said.

The agency request budget also includes the cost of expanding Medicaid to already eligible Nevada residents expected to enroll in the program because of the federal Affordable Care Act. This piece is expected to cost $86.6 million.

The budget does not include an expansion of Medicaid to a newly eligible group of Nevadans provided for under the health care law, Mohlenkamp said. Sandoval has yet to make a decision on that issue, he said.

“We have decision units prepared, that should the governor make the decision to opt in, then we can very quickly make that happen within the budget,” Mohlenkamp said.

The budget does anticipate the continuation of several tax increases that are now set to sunset on June 30, 2013. It also, for now, continues salary reductions and furloughs for state workers that would save approximately $160 million.

Sandoval has said he will consider restoring some of the reductions if general fund revenues are sufficient to do so.

Geoffrey Lawrence, deputy policy director for the Nevada Policy Research Institute, praised Sandoval and his budget staff for helping state agencies limit their spending increases.

“While not perfect, these agency budget requests are a concrete step toward limiting the growth of government from already inflated levels,” he said. “Besides limiting spending increases, this budget shows the power of performance-based budgeting, which focuses on providing the highest level of outcomes for every dollar spent.”

Lawrence also warned lawmakers against using any higher revenue projections from the Economic Forum to boost spending.

“Higher-than-expected revenue projections from the Economic Forum should be used to lower taxes on struggling Nevada families, instead of as an excuse to increase government spending,” he said.

Mohlenkamp said the spending numbers released today are expected to be within the general fund tax estimates set by the Economic Forum.

“We do believe that we are in the range, but we don’t know how close we are to actually what the Economic Forum will come in at,” he said. “But that’s pretty much of an unknown right now.”

The final budget will be the first to comprehensively include performance-based budgeting, Mohlenkamp said. The process is expected to make the budget more transparent so the public can easily understand where the money is being spent. It will also provide better accountability on whether the state is achieving its goals, he said.

Several major initiatives being proposed in the budget include a restructuring of the Division of Mental Health and Developmental Services, with the mental health side going to the Health Division, and the developmental services piece going to Aging and Disability Services.

“It’s a fairly major restructuring that is going on within Health and Human Services,” Mohlenkamp said.

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Audio clips:

Budget Director Jeff Mohlenkamp says Gov. Brian Sandoval has not yet made a decision on expanding Medicaid:

101512Mohlenkamp1 :25 decision on that.”

Mohlenkamp says the state’s tax revenues remain an unknown until the Economic Forum meets:

101512Mohlenkamp2 :19 unknown right now.”

 

 

Rory Reid Calls for Reform and Consolidation to Balance State Budget

By Sean Whaley | 6:40 am August 11th, 2010

(Updated at 6:50 a.m. on Aug. 11, 2010)

CARSON CITY – Democrat gubernatorial candidate Rory Reid told the Nevada News Bureau yesterday there are other options for moving the state out of its current budget crisis besides increasing taxes and cutting programs.

In an interview at a local coffee shop, Reid pulled out two pieces of paper. One showed an organization chart for the state’s public education system from 1989. The other shows how it looks now.

The newer chart showed many more layers of government, including advisory panels, legislative committees and other bureaucratic creations that have evolved over the past 20 years.

Reid said the two charts demonstrate one way Nevada can save several hundred million dollars: by streamlining government services to eliminate redundancies and inefficiencies in state government.

Reid, who is trailing GOP candidate Brian Sandoval in the polls, said he has experience balancing budgets as chairman of the Clark County Commission, budgets that are as big as the Nevada general fund budget.

“I know how to do this,” he said. “I’ve balanced it in good times and in bad for seven years running without new taxes. There are more than two options. The third option nobody talks about is to remake our government.”

Clark County had multiple housing authorities at one time, but Reid said he worked to consolidate them into one agency. There used to be multiple public health agencies, now there is one.

Reid did not back off his no new taxes stance, saying the state unemployment rate, the foreclosure crisis, and the overall economic situation in Nevada makes the idea of expanding such levies a nonstarter.

“We need a leader in Carson City that knows how to reform government structures,” he said. “If we do what needs to be done, we will save hundreds of millions of dollars and still maintain services by reforming our government.”

Reid said he will be putting out a proposal in the next several days addressing this issue in more detail.

Reid said Sandoval is offering no realistic solutions, instead saying he will avoid layoffs, protect vulnerable citizens and government services and still balance the budget.

“That is impossible,” Reid said.

The Sandoval campaign offered this response: “As a two-term legislator, an attorney general who returned money to the general fund and as a private law practitioner, Brian is proud of his budget experience. It’s curious that just a few months ago Rory Reid refused to say how he might balance the state’s budget.  Now he’s attacking Brian – the only candidate to lay out how he would have approached balancing our state’s short term budget deficit without mass layoffs or new taxes.”

Reid weighed in on the state’s budget problems as state Budget Director Andrew Clinger has spoken in recent days of the severity of the impacts facing Nevada when the Legislature convenes in February.

Clinger said the state is facing an estimated $3 billion shortfall in the revenues needed to sustain state government for the next two years, or nearly 50 percent of what would be a $6.5 billion general fund budget.

On Monday Clinger said new taxes might be avoided if the state and counties worked together to more efficiently divvy up the delivery of government services and the revenues used to pay for them.

Even so, both Sandoval and Reid have steadfastly rejected any notion of raising taxes as a partial solution to the state’s budget problems.

In an interview today on the KRNV Channel 4 noon news, Senate Minority Leader Bill Raggio, R-Reno, said he would not reject out-of-hand the idea of new or increased taxes as one option to solving the state’s budget crisis.

“There is no question that we are facing a very severe problem, the largest shortfall in our history,” he said. “We did take money from counties last time, cities and counties, and there is a bottom to that well also.

“No one wants to advocate raising taxes, or new taxes,” Raggio said. “We will probably have to look at restoring the taxes that are going to sunset. But I don’t think anybody should take a blood oath that we’re not going to look at that.”

Raising taxes is a last resort, he said.

“But I wouldn’t take it off the table,” Raggio said.

The 2009 Legislature raised the sales tax and the modified business tax on the state’s largest employers as part of a solution to balancing the current budget. Those taxes will expire on June 30, 2011 unless they are extended by the Legislature.

Reid said there is one other way that Nevada can get out of its budget crisis, and that is “growing” out of it through economic development. There are $5 billion worth of energy projects getting close to construction that will generate construction jobs and tax revenues to the state, he said.

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Audio clips:

Rory Reid says the state can save millions by remaking an outdated state government:

081010RoryReid1 :17 21st century economy.”

Reid says he has experience in reforming government structures:

081010RoryReid2 :15 reforming our government.”

Reid says Sandoval promising more than he can deliver:

081010RoryReid3 :23 that is impossible.”

Budget Director Says Major Changes Needed To Fund Government Services

By Sean Whaley | 4:12 am August 10th, 2010

CARSON CITY – Nevada could find a way out of its $3 billion revenue shortfall next year without raising taxes, but only if the Legislature looks at restructuring the way the state and local governments provide and pay for services, the state’s top fiscal officer said yesterday.

State Budget Director Andrew Clinger, interviewed Monday on the Nevada NewsMakers television program, said the Legislature would also have to consider changes to the state’s collective bargaining law to get a handle on local government salaries, which he called “unsustainable.”

“I think there is a way to do it without raising taxes but you’re talking about some radical changes,” he said. “And I think the only way . . . to do it without raising taxes is you need to look at not only state government but you have to look at local government.”

Clinger said Nevada state government spends less money on its programs than other states. But when local government is added into the mix, the state falls into the middle of states on spending on government programs per capita.

The budget discussion in the upcoming legislative session would have to involve the potential shift of services between the government entities along with the revenues that would pay for them, he said.

In Nevada, property taxes pay for public education and local government but not state services. Sales and gaming taxes, along with the modified business tax and several other levies, are the revenues that fund state general fund government operations.

Clinger did not offer any specifics about what types of programs might be shifted as part of any realignment.

But Clinger said he does not see how the state’s potential $3 billion shortfall, which would approach 50 percent of what Nevada government needs to operate, from education to prisons, could be addressed solely with cuts at the state level.

The only program he mentioned during the interview was Nevada Check Up, a program funded by the state and federal government that provides health insurance to just under 22,000 low-income children who are not eligible for Medicaid. The program is costing the state general fund about $10.8 million this year. Another $25.4 million is coming from the federal government, funding that would be lost if the program was eliminated.

Clinger said the state’s collective bargaining statutes would also have to be part of any discussion by the governor and Legislature with local governments.

Clinger said the last surveys he reviewed showed state salaries about 7 percent ahead of the private sector, while local government salaries were running about 30 percent ahead of the private sector.

“You would have to open up the collective bargain statutes and make some changes there that could help sustain government moving forward because at those salary levels it is not sustainable,” he said.

State employees do not have collective bargaining rights in Nevada, although local government employees and teachers do.

Clinger said the $3 billion shortfall out of a two-year, $6.5 billion general fund budget can be partially addressed by actions the governor and Legislature can take on their own. State employee furloughs and benefit reductions, for example, could be continued for two more years at a savings of about $500 million, he said.

Much of the state budget shortfall is due to tax increases approved by lawmakers in 2009 that will expire unless extended, and the loss of future federal stimulus funds.

Assemblywoman Sheila Leslie, D-Reno, said she has heard concerns expressed by local government officials that there might be an effort to transfer state services to the local level.

“I have talked to several county commissioners who are quite concerned,” she said. “I think those discussions should be happening now if they are going to happen. I haven’t seen anyone organize a formal discussion.”

Leslie, who is running for an open seat in the state Senate, said she has heard there might be a list of programs that could be eliminated entirely or that could be potentially transferred to local government. But the counties do not have any surplus funds they could infuse into state programs if a transfer occurred, she said.

With a new governor coming in January and the two leading candidates for the job rejecting any call for new taxes as a solution to the state’s budget problems, not to mention a major turnover in the Legislature with the departure of long-time leaders, “we’re in a very tenuous spot,” Leslie said.

Clark County Commissioner Chris Giunchigliani, a former state lawmaker, said a discussion of which level of government should provide what services is worth having, but she questioned whether it would deliver enough savings to make a significant difference in the state’s budget shortfall.

“I don’t think you can cost shift your way out of the budget problems,” she said.

Giunchigliani said the Legislature should take a look at the study on broadening the state’s sales tax base by the Nevada Policy Research Institute as a starting point for a conversation on the state’s revenue structure.

While not in support of taxing food or medical devices, the study looks at spreading the sales tax over a wider base while at the same time reducing the overall rate, she said.

“It gives the Legislature something to take a look at, and local governments should weigh in,” Giunchigliani said.

Ben Kieckhefer, public information officer for the Nevada Department of Health and Human Services, which operates the Check Up program, said the trend his agency has seen is counties transferring programs to the state when possible due to funding concerns.

One recent example is the state having to pick up elder protective services from Clark County, which occurred on July 31, he said.

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Audio clips:

State Budget Director Andrew Clinger says local governments would have to be involved in plan to balance state budget without new taxes:

080910Clinger1 :31 to other states.”

Clinger said a shift of services and funding between state and local government would be needed:

080910Clinger2 :24 sorts of things.”

Clinger says the state’s collective bargaining law would have to be part of the discussion:

080910Clinger3 :30 it’s not sustainable.”

State General Fund Tax Revenues To Come In $100 Million Above Projections

By Sean Whaley | 1:10 pm July 13th, 2010

CARSON CITY – Nevada State Budget Director Andrew Clinger said today he expects the current two-year budget to end up next June 30 with about $100 million more in tax revenues than projected in January.

While there are increased costs to the state that will offset that optimistic assessment, the higher than anticipated tax revenues should help carry the state forward into the 2011 legislative session in February without the need for any further budget cuts, he said.

The state is about $57 million ahead in tax revenues right now, with sales and use taxes, the modified business tax and the insurance premium tax all above projections, Clinger said. If that trend continues, the state will hit or exceed the $100 million mark by the end of the biennium, he said.

Increased costs to the state include higher Medicaid caseloads, which are expected to cost about $10 million more than budgeted, Clinger said.

The state was also counting on about $88.5 million from the extension of a Medicaid program by Congress, but that is not now expected to be approved, he said. A number of states were anticipating that Congress would approve a six-month extension of a temporary enhancement to the program which provides funding for state Medicaid and other health programs. The temporary extension would have brought $88.5 million to Nevada and was included in the state budget.

Another $9.4 million for the state’s welfare program, called Temporary Assistance to Needy Families, was part of the same bill that now won’t be forthcoming either, he said.

“We have pluses and minuses,” Clinger said. “But when you sort of take the additional revenue that we have and start subtracting those things off, we’re going to end up pretty close to what we thought we would during the special session.”

The Legislature in February approved $800 million in spending cuts and limited fee increases to balance the current two-year state budget.

Clinger said one wild card is a legal challenge to the state’s use of $62 million taken from Clark County for a pipeline project as part of the plan to balance the budget. That diversion of funds is being challenged in court by the Clark County Clean Water Coalition.

The money was counted on in the budget for the current fiscal year that began July 1, and the Legislature will have to address the issue should the funding not materialize, he said.

The positive change in tax revenues from projections made in January by the Economic Forum are being seen in most major state revenues. Gaming revenues are an exception so far.

Frank Streshley, an analyst with the Nevada Gaming Control Board, reported last week that the final gaming numbers for fiscal year 2010, which ended June 30, were about $8.5 million below the forum projections.

Taxable sales for April, released earlier this month, were up 2 percent, the first increase in 20 months. The general fund portion of the sales and use taxes is 3.2 percent, or $19.3 million, above the Economic Forum’s forecast for the 10 months of fiscal year 2010.

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Audio clips:

State Budget Director Andrew Clinger on new tax revenue forecast:

071310Clinger1 :20 of the biennium.”

Clinger on the balance between new revenues and unanticipated expenditures:

071310Clinger2 :17 the special session.”

State Budget Director Outlines New Process For Developing 2011-13 Spending Plan

By Nevada News Bureau Staff | 5:46 pm June 7th, 2010

CARSON CITY – State budget Director Andrew Clinger today sent a memo to all agencies saying the process of building the new two-year Nevada budget will be substantially different from past practice.

Given the fiscal crisis faced by the state over the past three years, Nevada can no longer craft a budget by taking the previous year’s expenditures, adjust for one-time expenditures and add inflation and caseload growth, he said.

“We must create a budget process that looks first at the outcomes citizens expect,” Clinger said. “Some of the questions this new budget building approach needs to answer are: What is the proper role of state government? What services must we provide? What is the most efficient way to provide those services? And, what is the best way to pay for them?”

Clinger said the administration has formed the Priorities of Government Working Group to help answer these questions by reviewing and prioritizing all state services. The first step will be to create an inventory of all state services and the outcomes they produce.

As part of this process, agencies will be required to provide mission statements and a list of activities the agency engages in. Also required will be the populations served, the cost of the activity, how the activity is currently funded and outcome and output measures related to the activity.

“The answers to these questions along with other criteria identified by the working group will help us begin to prioritize where to use our limited state resources and engage in activities that produce the most valuable outcomes for our citizens,” Clinger said in the memo.

Agencies are required to submit their preliminary budgets for the 2011-2013 biennium to the Department of Administration by Sept. 1.

State Budget Town Halls

By Elizabeth Crum | 12:25 pm February 13th, 2010

We are live Tweeting the two state budget town hall meetings.  To follow and catch up on this morning’s Tweets, follow @NVNewsBureau.com.  Phillip Moyer, our intern, is Tweeting from Reno using the hashtag #renoth.  I’m Tweeting in Vegas using #lvth.