Nevada Legislature approves 5 spending bills to fund state government

CARSON CITY — The five bills making up the state’s two-year $6.6 billion general fund budget were passed by the Legislature on the last day of the session Monday with plenty of time to spare.

The measures sent to Gov. Brian Sandoval will ensure funding for public education and state programs for the fiscal year starting July 1.

Sandoval wasted no time with the public education funding bill, signing it into law Monday.

Lawmakers were also approving a package of taxes to help fund a big portion of the budget. The taxes were scheduled to sunset on June 30 but Sandoval sought to continue them for two more years to avoid cuts to the public education budget.

The sunset tax extension was not contentious as it was at the close of the 2011 session.

Finalizing the 2013-15 budget was the culmination of 120 days of review by the Senate Finance and Assembly Ways and Means committees.

THERE WERE SOME BUMPS

It didn’t come without a bump or two along the way, however.

The Assembly attempted to vote out Senate Bill 521, the authorizations act, before realizing the move was a violation of the state constitution.

Nevada law requires that the education funding bill be voted out of the Legislature first, and the Assembly had not done so. The vote was halted so Senate Bill 522, funding public education, could be processed first.

It passed on a 38-4 vote in the Assembly after getting a unanimous vote in the Senate.

Education representatives testified in support of the school funding bill, noting particularly the emphasis on early childhood education with an expansion of all-day kindergarten and funding for English Language Learners.

The budget has $40 million for an expansion of all-day kindergarten to 201 schools from the current 128 schools and $50 million for ELL.

Per pupil spending will rise from $5,374 now to $5,590 in the first year of the budget and to $5,676 in the second year.

Ways and Means Chairwoman Maggie Carlton, D-Las Vegas, said the increase in per pupil expenditures is a notable achievement.

“We’re on our way back up,” she said.

In all, public education funding from all sources will increase by $489 million in the new budget, a 7.8 percent increase.

MORE HEALTH FUNDING

The budget also includes $13 million in new funding for mental health programs, including an expansion of 10 beds at the Rawson-Neal Psychiatric Hospital in Las Vegas, where a political firestorm has erupted over the transfer of patients out of state, including at least a couple of cases of alleged patient dumping.

There is also an expansion of the Medicaid program to newly eligible Nevadans under the federal health care law. About 78,000 Nevadans are expected to be added to the program beginning Jan. 1, 2014.

Sandoval opposed the Patient Protection and Affordable Care Act and even joined in a multi-state legal challenge, but opted to expand Medicaid when the law was upheld by the U.S. Supreme Court.

Federal funding will pay for 100 percent of the Medicaid expansion for the first three calendar years beginning in 2014, with the state required to pick up a percentage of the cost starting in 2017.

During a short debate on the $4 billion bill funding state government, Sen. Mark Hutchison, R-Las Vegas, warned that in the future, the state might not be able to support schools and other programs because of the costs associated with the act.

“We don’t have major problems now, but in the future we will,” said Hutchison, who represented the state in the losing lawsuit against the act.

COLLEGE FUNDING FORMULA

The budget also includes a new formula for funding higher education that will send about $13 million to colleges in Southern Nevada.

Under the new formula previously adopted by the Board Regents, funding will be based on how many class credits students complete. Additionally, upper level courses will be given more weight in the funding balance because they cost more to offer.

The budget also eliminates a 2.5 percent pay cut to state employees, but will require them to take six unpaid furlough days each year.

It also includes $4 million to allow Nevada to compete with other states for a research center on the use of drones, $1 million less than requested by Sandoval. If successful, the drone project could be worth $2.5 billion to Nevada’s economy.

Lawmakers also approved the extension of a package of expiring taxes sought by Sandoval to help pay for the budget.

The main piece of the tax package, Senate Bill 475, keeps the 1.17 percent tax on business payrolls, a $200 a year business license fee and a 0.35 percentage point tax to support schools. Portions of these taxes would have expired after June 30, but the Legislature is moving to extend them to June 30, 2015.

A plus in the bill, however, is the first $340,000 in payroll paid by a company will be exempt from the tax. Now the exemption is on the first $250,000. With the exemption, many small companies will pay no payroll taxes.

Sen. James Settelmeyer, R-Minden, voted against the extension.

“Once again we are extending them when they are supposed to sunset,” he said.

But Sen. Pete Goicoechea, R-Eureka, said the taxes are necessary to balance the budget.

Contact Capital Bureau Chief Ed Vogel at evogel@reviewjournal.com or 775-687-3901. Contact Capital Bureau reporter Sean Whaley at swhaley@reviewjournal.com or 775-687-3900.