$1 billion: Lawmakers eyeing huge budget hole

Lawmakers were warned Saturday it will take nearly a billion more in revenue just to fund Gov. Jim Gibbons' recommended budget and $2.4 billion to restore agencies to their current levels of service.

The gloomy picture was presented in the wake of Friday's Economic Forum meeting. When all sources of money which feed the General Fund are considered, legislative analysts show revenues between $550 million and $584 million short to finish this fiscal year and fund the governor's recommended $6.1 billion budget for 2010 and 2011.

Director of Administration Andrew Clinger said his preliminary number was in the same range.

But Assembly Fiscal Analyst Mark Stevens told the Ways and Means Committee Saturday that is before the estimated $400 million the state will have to make up to public school budgets where both the 75-cent property tax and local school support portion of the sales tax are falling short of original projections.

Added together, the total is just shy of $1 billion and that is before the estimated $100 million in "add backs" lawmakers have restored to the budget over and above what Gibbons recommended.

The "core group" of lawmakers trying to work out solutions to the budget crunch met behind closed doors for nearly two hours Saturday morning to discuss the situation. Those exiting the meeting said little was accomplished because staff hasn't had time to finalize the numbers.

Once that is done, they plan to meet Monday to decide how much revenue they will need to raise to balance the budget.

Assembly Speaker Barbara Buckley, D-Las Vegas, said the total shortfall would produce a budget 44 percent below the originally approved current budget.

"It's fairly obvious to us you cannot cut the state budget by 44 percent," she said. "We'd have to close down the schools, boot seniors out of nursing homes and close down the prisons."

"We've cut enough," said Ways and Means Chairman Morse Arberry, D-Las Vegas.

He said like it or not, lawmakers are going to have to "bite the bullet and vote for revenues."

When they're accused of raising taxes, he said, "they're going to have to go home and say we saved education for our children, saved seniors."

Senate Majority Leader Steven Horsford, D-Las Vegas, told fellow Senators they won't be able to restore everything the governor cut from the budget.

"In order to restore some of the cuts, we will need to identify new revenue to fund education and healthcare for children and seniors," he said.

He said the cost will have to be shared by all.

"Casinos, mining, unions, large corporations and taxpayers will all have to share in this burden," Horsford said.

"If we do tax, it's going to be fair," Arberry said. "It's not going to be one segment we find and tax the living daylights out of them."

In addition to spreading the pain across all quarters, Senate Minority Leader Bill Raggio, R-Reno, is calling for sunset provisions on everything they decide to increase so that the higher rates go away once the economy recovers.

Exiting the Saturday meeting, Raggio refused comment on progress, but Sen. Randolph Townsend, R-Reno, described the situation as "ugly."