Nevada state budget
From Sunshine Review
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Nevada faced in 2009, by one estimate, the highest budget gap among the states as a percentage of its general fund ($2 billion shortfall, 30% of GF). The Nevada 2009 Legislative Session (which meets every 2 years for a 120-day maximum regular session) was marked by contention between Gov. Jim Gibbons and the Nevada State Legislature on how to close the deficit in building the FY 2010 (July 1, 2009 to June 30, 2010) and FY 2011 (July 1, 2010 to June 30, 2011) biennium budget. Gov. Gibbons recommended 6% pay cuts for state workers and teachers, a $500 million cut from higher education (36%), and accepted $220 million tax increase from the hotel room tax, approved by voters in Clark and Washoe counties.[1]
The Nevada Legislative leaders rejected Gov. Gibbons' plan, but did not publicly offer an alternative until late in the session after numerous "closed door" meetings up to its final unveiling in late May of 2009. The $6.86 billion, 2-year Legislative budget plan that was passed, vetoed by Gov. Gibbons, and overode by the Legislature included:[2]
- Passing on a 4% cut of teacher salaries to school districts (which must negotiate salaries individually with the teacher unions)
- 12 furlough days for state workers (4.6% salary cut)
- 12.5% cut from higher education
Total of salary cuts and program cuts of $1 billion
- $350 million of federal stimulus money
- $781 million "temporary tax increases" scheduled to sunset in 2 years (including a state raid on property tax revenues from Clark and Washoe counties)
- Business Payroll Tax up $346 million
- Sales Tax increase $280 million
- Vehicle Registration up $94 million
- Doubling of Business License Fee $61 million
- Gov. Gibbons vetoed a total of 41 bills (budget and non-budget) during the 2009 Session of which the Legislature overode 25.
[edit] Budget Background
The approved Nevada GF FY 2008 and FY 2009 biennium budget was $6.8 billion, but actual spending was $6.3 billion due to cuts made as revenue declined.[3] Nevada does not have a state income tax. 33% of GF revenue for the FY 2008 and FY 2009 biennium came from sales tax and 27.5% from gaming taxes. Actual collections in August 2009 were down in total $25.8 million (6.9%); sales taxes were down 8.1% and gaming collections a negative 4.7%.[4]
Nevada’s Constitution requires that the state have a balanced budget and not deficit spend. Individual state agencies submit their budget requests along with past expenditures and revenue to the Governor who proceeds to issue a budget recommendation for the upcoming fiscal year to the Legislature. Both the State Assembly and the Senate are required to make any necessary changes or adjustments to the budget until the bill is passed in both houses.[5]
- The General Fund is a significant source of revenue for the state, accounting for 37 percent of total projected revenue. Federal funds account for almost one quarter, 21 percent, of the state’s projected revenues. Other revenue encompasses a variety of items from private gifts and donations to various fees, assessments, and taxes. [5]
Regular sessions of the Legislature begin the first Monday in February of odd-numbered years. Nevada is one of only six states that have true biennial sessions. From 1961 through 1997, the length of legislative sessions in Nevada depended upon the time required to process proposed legislation, review the spending proposals of state agencies, and adopt a biennial state budget. Some sessions lasted as long as 169 days. At the 1998 General Election, Nevada voters approved a constitutional amendment limiting future regular biennial sessions to 120 days. The amendment also requires the governor to submit the executive budget to the Legislature two weeks before the start of session.[6] Bills that have a tax or fee increase require a 2/3 majority vote (14 in the Senate and 28 in Assembly) to pass.[7]
[edit] Budget figures
The following table provides a history of Nevada's expenditures and gross domestic product (GDP).
| Fiscal Year | Expenditures (billions) | GDP (billions) |
|---|---|---|
| 2000 | $11.2 [8] | $73.7 [8] |
| 2001 | $12.6 [8] | $77.3 [8] |
| 2002 | $14.0 [8] | $81.3 [8] |
| 2003 | $15.1 [8] | $87.8 [8] |
| 2004 | $16.2 [8] | $100.2 [8] |
| 2005 | $17.4 [8] | $112.5 [8] |
| 2006 | $18.8 [8] | $123.1 [8] |
| 2007 | $20.4 [8] | $127.2 [8] |
| 2008 | $22.1 [8] | $131.5 [8] |
| 2009 | $23.9* [8] | $136.0* [8] |
- NOTE: The figures for FY 2009 won't be finalized until the end of the fiscal year.
- See Nevada state budget (2008-2009) for more details.
[edit] Accounting Principles
The Legislative Auditor for the Nevada Legislative Counsel Bureau, Audit Division audits Nevada's state agencies and publishes audit reports online. Paul Townsend is Legislative Auditor. The Legislative Auditor is a statutory officer appointed by the Director of the Legislative Counsel Bureau with the approval of the Legislative Commission for an indefinite term whose qualifications and duties are defined by law. The Legislative Auditor serves as staff to the Nevada Legislature and its various committees, and is the chief of the Audit Division.[9]
The Institute for Truth in Accounting (IFTA) rates Nevada “Timely” in filing the state’s Comprehensive Annual Financial Report (CAFR) – The annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA does not consider Nevada's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care.[10] Nevada's CAFRs are prepared and published online by the Nevada State Controller's Office.
Kim Wallin was elected Nevada's State Controller in November of 2006.[11] The Nevada State Controller is one of the six constitutional officers of the state and is elected to a term of four years. The Controller is the chief fiscal officer charged with administering the state accounting system and the state's debt collection program under the Nevada Constitution Article 5, Section 19.[12]
| Credit Rating | Fitch | Moody's | S&P |
| Nevada[13] | AA+ | Aa2 | AA+ |
[edit] Economic Stimulus Package
Nevada is expected to receive $1.5 billion from the $787 billion dollar economic stimulus. [14] All told, the federal stimulus plan would create or save 34,000 jobs in Nevada, based on White House estimates. [15] However, like some Governors, Gov. Gibbons said that he would not accept $77 million in unemployment funds because it would require an expansion of coverage to some people not previously eligible. Additionally the Governor added that he felt taking the money would be a threat to the state’s sovereignty. But, in March 25,2009 Gibbons decided to accept the funds.[16] Gibbons was quoted in The New York Times saying:
"We have the responsibility to do everything we can to help our unemployed workers get through these difficult times, even if that means passing legislation that we would not necessarily approve during prosperous times."[16]
For more information on how the federal stimulus funds are being used in the state of Nevada, visit the state recovery website.
According to preliminary reports Nevada is expected to receive:
- $84 million towards Medicaid [17]
- $77 million for unemployment [16]
- $201 million for road construction [18]
- $32 million to fund energy efficiency improvement projects [19]
[edit] Budget transparency
Nevada Open Government is the website which hosts the state's searchable online database of financial data. The site was created by Governor Jim Gibbons's executive order, and became functional on January 15th, 2009.
[edit] Legislation
[edit] Government tools
Nevada Open Government is a Website where records of Nevada state spending are made available. Currently, the site is limited in the scope of information it contains. As more funds become available, it is anticipated that more government spending data will be placed online.
The following table is helpful in evaluating the level of transparency provided by a state spending database:
| State Database | Searchability | Grants | Contracts | Line Item Expenditures | Dept/Agency Budgets | Public Employee Salary |
|---|---|---|---|---|---|---|
| Nevada Open Government |  | | | |  | |
[edit] Limitations and Suggestions
As the table above notes, the site is not searchable and lacks information on grants, contracts, and state employee salaries.
[edit] Economic Stimulus Transparency
- The Economic Recovery and Reinvestment Act of 2009 designated $787 billion to be spent throughout the U.S. Of that $787 billion stimulus package, it is estimated that 69%, or over $541 billion, will be administered by state governments.[20]
- Nevada will receive an estimated $1,052,020,435 [21]
- The economic recovery website to show how legislators and government officials in Nevada are spending Federal funds is available here.
[edit] Independent transparency sites
The Nevada Policy Research Institute developed its own transparency website, TransparentNevada.com.[22] This site will focus primarily on local transparency, complementing the state's site, which focuses primarily on state spending transparency.
[edit] Public employee salary information
TransparentNevada.com, a project of the Nevada Policy Research Institute,[23] has made Nevada salary data available here.
[edit] See Also
Nevada taxpayer-funded lobbying
[edit] External links
- Nevada Policy Research Institute
- TransparentNevada.com
- Nevada Taxpayers Association
- Nevada Open Government, official website
- Nevada Division of Budget and Planning, Department of Administration
- Model transparency legislation from the American Legislative Exchange Council is available at this link.
[edit] Additional reading
[edit] References
- ↑ Las Vegas Review-Journal, "'SINE DIE': Legislature finishes quietly," June 2, 2009
- ↑ Las Vegas Review-Journal, "'SINE DIE': Legislature finishes quietly," June 2, 2009
- ↑ Las Vegas Review-Journal, "'SINE DIE': Legislature finishes quietly," June 2, 2009
- ↑ Nevada Division of Budget and Planning Web site, retrieved October 31, 2009
- ↑ 5.0 5.1 State of Nevada,"Introduction to State Budgeting," October 2007
- ↑ Nevada State Legislature Web site, retrieved October 31, 2009
- ↑ Nevada Legislative Counsel Bureau Research Division, "Nevada State 2009 Legislative Manual," February 13, 2009
- ↑ 8.00 8.01 8.02 8.03 8.04 8.05 8.06 8.07 8.08 8.09 8.10 8.11 8.12 8.13 8.14 8.15 8.16 8.17 8.18 8.19 US Government Spending,"Nevada State and Local spending," retrieved April 7,2009
- ↑ Nevada Legislative Audit Division Web site, retrieved October 31, 2009
- ↑ Institute for Truth in Accounting, “The Truth About Balanced Budgets—A Fifty State Study,” Page 35
- ↑ The Green Papers, "Nevada's General Election," retrieved October 31, 2009
- ↑ Nevada State Controller's Office Web site, retrieved October 31, 2009
- ↑ State of Indiana, “State Credit Ratings-as of June 24, 2009"
- ↑ Cite error: Invalid
<ref>tag; no text was provided for refs namedNevadaBudget - ↑ American Recovery and Reinvestment Act,"Impact," retrieved April 7,2009
- ↑ 16.0 16.1 16.2 The New York Times,"Nevada Governor Retreats on Unemployment Stimulus Funds," March 25,2009
- ↑ Associated Press,"Nevada getting about $84 million in stimulus funds for Medicaid," April 7,2009
- ↑ KOLO-TV,"Stimulus Funding for local roads," April 7,2009
- ↑ Las Vegas Sun,"Nevada gets $32 million in stimulus grants for energy efficiency projects," March 26,2009
- ↑ National Taxpayers Union, "A Letter to the Nation's Governors: Ensure Transparency and Accountability by Posting Stimulus Expenditures Online," March 10, 2009
- ↑ [1]
- ↑ New Transparency Website Launched, Nevada Policy Research Institute, September 8, 2008
- ↑ Nevada Policy Research Institute homepage
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