Surplus just as hard to deal with as budget shortfall
Legislative leaders are discovering that having excess money can be just as big a headache as having too little.
The 2003 Legislature was all about how little money the state had. This year, there’s a surplus. Seeing that extra money on the table has ignited what key legislators describe as a “feeding frenzy” among special interest groups, non-profits and advocacy groups as well as state agencies, law enforcement and the military.
“It’s like dipping a bloody toe in a pool of piranhas,” said Sen. Bob Beers, vice chairman of Senate Finance.
He said $3 billion in additional funding requests doesn’t include more than $80 million in one-shot projects and supplemental appropriations for costs already incurred by state agencies. And it doesn’t include the millions that must be added to the executive budget because of changes in federal authorizations and errors in the budget, an estimated $40 million in Medicaid alone.
Ways and Means Chairman Morse Arberry, D-Las Vegas, said the state also needs to put money into its Rainy Day Fund in case of another economic downturn.
He said those and other important needs will pass, but as for the numerous other proposals: “It’s not the golden goose at the end of the rainbow they think it is. It’s not there.”
Senate Majority Leader Bill Raggio, R-Reno, said public schools budgets may need as much as $300 million in additional funding.
After those costs, he said, there isn’t nearly enough left to cover everybody’s wishes, no matter how good the program appears.
“It’ll be a matter of priorities,” he said.
Assembly Speaker Richard Perkins, D-Henderson, drew the same conclusion: “We have to look at priorities and determine what we need to spend money on.”
Both said the Economic Forum, which meets May 1 to decide what revenues lawmakers have to spend, will determine how far down that list they can go.
The so-called “monster bills” – four proposals that would spend a total of $2.5 billion on public schools – “were introduced to make a point,” said Perkins. That point: How far Nevada needs to go to improve public education.
The list has more than 100 other bills that pump money into a laundry list of programs.
Assemblywoman Chris Giunchigliani, D-Las Vegas, said lawmakers must recognize the difference between pork and public policy. She said an example of a “public policy” issue in the list is Minority Leader Lynn Hettrick’s AB412, which would put $26.6 million into “prefunding” the retirement program for Nevada’s district and Supreme Court judges.
“I agree with that,” she said, pointing out the alternative is for legislators to put several millions into paying judicial pension each session.
Hettrick said the one-time infusion of cash would save the state upwards of $100 million in the future.
Giunchigliani said the huge wish list of bills “tells you there are a lot of things underfunded that are needed in this state.”
Beers said bills like SB439 also make sense. That proposal appropriates $150,000 to help improve rural airports, which the federal government will match at a rate of 19:1.
Hettrick and Giunchigliani joined Beers in decrying the “feeding frenzy” by groups eyeing the state surplus.
While none of those interviewed pointed to any specific proposal as “pork,” there are a number of requests from groups that normally have no access to state funding.
Examples include The Urban Chamber of Commerce for $1.27 million, a hospice in Henderson for $4 million, Boys and Girls Clubs SMART Moves for $1.5 million, the Agassi school for $900,000, Western Folklife Center in Elko for $200,000, Easter Seals of Southern Nevada for $4 million and Lear Theater in Reno for $394,443.
State Director of Administration and Budget Perry Comeaux said the so-called pork isn’t his main worry. He said his biggest concern is the proposals which aren’t one-time costs but create an ongoing obligation.
Hettrick and Guinn’s chief of staff Mike Hillerby too expressed concern about committing the state to new, ongoing costs.
“There’s lots of money now, but what happens if things turn around again in the future?” asked Hettrick. “We’re priming ourselves for a huge problem.”
Hillerby said many of those with the biggest ongoing price tags are designed to improve public schools or the university system and therefore have strong emotional support.
Arberry said emotions must be put aside as much as possible “because there are always going to be lots of meritorious ideas.”
“It’s not going to be a spending frenzy,” he said. “The worst thing we could do to the public is, now that we have some money, go hog wild.”
Contact reporter Geoff Dornan at email@example.com or 687-8750.