CARSON CITY – The budget situation for Nevada’s universities and colleges may have worsened today as legislators voted to both cut and restore funding for higher education.
Democratic legislators first voted to restore $100 million to the higher education budget, but Democrats also continued to oppose a shift of Washoe and Clark County property tax money from county governments to the University of Nevada, Reno and the University of Nevada, Las Vegas.
That property tax shift represents $120 million that the universities were counting on in the governor’s recommended general fund budget.
Assemblywoman Debbie Smith, D-Sparks, said legislators fully intend to replace that money with general fund dollars.
But Senate Majority Leader Steven Horsford, D-Las Vegas, was not so sure.
“That decision has not been finalized,” he said.
Horsford said backfilling that $120 million hole is “one of the options” the Legislature may consider.
If the Legislature does nothing, Nevada’s higher education world may be worse off than it was under Gov. Brian Sandoval’s recommended general fund budget.
“If they don’t replace the property tax money they took out, we’re in very bad shape,” said Jim Richardson, a lobbyist for the Nevada Faculty Alliance.
Richardson said he had thought the Legislature would either apply the property tax shift to all 17 counties or use general fund dollars instead.
Legislature Votes To Reduce Tuition Increase By 13 Percent
Students, however, might feel a little better after legislators on two money committees voted today to support a 13 percent tuition increase spread over the next two years rather than a 26 percent increase, as was proposed earlier.
That would mean the universities would have to find more money because many colleges and universities assumed a 26 percent increase.
“That money has to be cut from somewhere and it would appear that means program cuts and layoffs,” said professor Gregory Brown of the UNLV Faculty Alliance.
The 13 percent tuition increase would bring Nevada’s colleges and universities about $42.4 million during the next two years.
The problem is, higher education administrators were counting on the $120 million worth of property tax diversions in addition to revenues collected through tuition.
The votes, however, all hinge on the Legislature passing new taxes or extending current ones, which are scheduled to sunset June 30. If that does not happen, legislators would have to re-examine these actions.
“We closed the budget, but the funding has not been identified so you can’t get too excited yet,” Smith said. “All you can count on is what we did today, and that’s contingent on us finding the revenue …It’s a budget in motion.”
Sandoval has recommended a two-year, higher-education budget that was $254 million less than the amount of money the Legislature approved during the 2010 special session.
That would be reduced to a $112 million cut if the Board of Regents approves the tuition increases and the Legislature finds $100 million to give to colleges and universities. The Legislature would also have to find $120 million to replace the funding that would have gone to higher education through the local property tax diversion.
Before today, legislators had anticipated following Klaich’s four-point plan, which would have called for $80 million in new revenue and a 26 percent tuition increase.
Students had testified before a legislative committee about keeping tuition low before legislators voted to recommend a 13 percent increase to the Board of Regents, which makes the final call on student fees.
Republicans largely objected to the $100 million in new revenue.
“I don’t know where we’re going to get the money to pay for this,” said Assemblyman Randy Kirner, R-Reno. “I just think we don’t have the money. At this point in the game, this is kind of where I have to stand.”
At this point in the legislative game, legislators are debating taxes. Sandoval included spending $6.1 billion in his 2011-2013 general fund budget. Democrats want to spend about $7 billion, with $626 million coming from extending taxes set to expire June 30 and the rest from new taxes on business and services like haircuts, attorneys and brothels.
“Bottom line is: there are taxes being paid that if continued would cover this [$100 million],” said Horsford.
Legislative committees also earlier supported a 4.8 percent salary cut to university employees, adding between $7.5 and $10 million in extra spending because the governor recommended a 5 percent cut.
“The reality is, the work is not done because we still need to get folks to pay for it,” Horsford said.