Editor’s note: At 5 p.m. Monday the governor’s office released budget cut proposals for legislators to consider at this week’s special session. Cuts include $233 million from health and human services, $190.6 million from higher education, and $166 million from K-12 education. The governor’s office did not identify any specific tax increases except to say if there are any, they should be limited to augmenting existing revenue sources, not creating new ones, and “If the legislature is able to move a revenue package forward, with the two thirds vote required, the Governor is willing to consider the legislation.”
Gov. Steve Sisolak as of Monday morning had not released any details on how he will propose legislators balance the state budget. But community advocates feel confident they already know what’s coming.
Budget cuts. Lots of them.
Thanks to business shutdowns and restrictions precipitated by the coronavirus pandemic, Nevada is facing an estimated $1.3 billion shortfall for Fiscal Year 2021, which began July 1. Approximately $900 million of that is within the General Fund, with the remainder falling to the Distributive Schools Account, which funds K-12 education.
Sisolak has previously suggested it will be nearly impossible to shield any particular agency from the impact of the budget shortfall. State legislators from both sides of the aisles — who are expected to convene Wednesday for a special session to address the budget shortfall — have echoed that sentiment.
“What I wish they would be discussing is revenue,” says Annette Magnus, executive director of Battle Born Progress. “I don’t think they’re willing to deal with the revenue issue. We don’t do our tax structure correctly.”
Magnus points to a recent report from Americans for Tax Fairness that found 11 billionaires in Nevada saw their collective wealth increase by $11.2 billion during the first three months of the pandemic.
“I’m not prescribing one thing over another,” she adds. “Leave no stone unturned. I don’t think a solution should be regressive and hurt people who are already hurting, but there are industries like mining and other things that have needed to be taxed for years. There are places where we could increase revenue that will not hurt the people.”
Laura Martin of the Progressive Leadership Alliance of Nevada agrees.
“The state really has to look at itself and seriously ask why it is so easy for us to build a $750 million stadium but not properly fund education. How can we give Elon (Musk)” public subsidies “but have no mental health system worth being proud of?”
Martin thinks the state should consider its tax abatements and exemptions.
But she doesn’t expect them to.
Neither does Clark County Education Association head John Vellardita, who predicted the special session will be “a flash in the pan.”
“(The special session) will have a shelf life of a few days. It’ll be over and at the end of the day it’ll be one list after another where cuts were made. We’d like to see some discussion about revenue but we’re not seeing a governor who’s interested.”
Even if he were, adds Vellardita, there is still the issue that tax increases must pass by a two-thirds vote of the Legislature — something the Nevada Democrats lack.
“If one party isn’t willing to work with the other, I don’t know how you get to it even if it was introduced.”
Vellardita said his union’s focus remains “the long game.” CCEA is circulating two petitions to raise revenue for education. The first proposal is to raise the gaming tax rate, which is one of the lowest in the country. The second is to raise the sales tax rate, which is one of the highest in the country.
CCEA expects the signatures to be gathered by Labor Day. Those proposals would then go before lawmakers during the 2021 Legislature for possible action.
“We’re trying to force a discussion on how we build a new economy in Nevada,” he says. “The lessons of ‘08 are too fresh in the memories and experiences of Nevada people. The same industries. The same revenue streams. The ones that crashed then.”
What to save from the chopping block
With tapered expectations regarding revenue discussions happening during this month’s special session, advocates are forced to choose which policy priorities to argue are worth saving above all else.
Vellardita says any cuts to education will be significant and set schools back. He points to Clark County School District’s proposed reopening plan, which calls for students at all grade levels to attend physical classes two days a week and then participate in remote learning the remaining three days. Their proposal, which is expected to be voted on by the school board this Thursday, requires an additional $86 million for technology, infrastructure and personal protective equipment.
“They’re banking on federal dollars. At a time when the governor is cutting $271 million out of education. I don’t know how these things add up.”
Martin of PLAN says preserving Victory and Zoom school funding needs to be a priority. Those two programs inject additional money into schools with high percentages of economically disadvantaged students and English Language Learners.
“Those are two examples of the part of education that’s attempting to right wrongs,” she adds. “Those students have already been set back. To take that funding from them would be devastating for generations to come.”
Tiffany Tyler-Garner, the new executive director of Children’s Advocacy Alliance, says her overall hope is that legislators “give attention to the differential impacts between communities.”
She points out that by many measures some communities hadn’t recovered from the Great Recession more than a decade ago.
“We say ‘we’ weathered the recession but it didn’t include all. All means all this time. … Leave no one behind. Our practices over time have left different segments behind and we are at risk of leaving even greater numbers behind if we’re not careful.”
Tyler-Garner also notes that a number of federal grants must be matched by the state in order to be received. This includes community development block grants for childcare assistance, something that threatens to become a crisis given the proposed CCSD reopening plan. Cuts to such programs would be twice as devastating.
She also worries about housing insecurity, an issue expected to reveal itself as the state phases out the existing restrictions on evictions.
“We hope for a strong recovery and rebound but if part of that process is stripping away the floor, the safety net that was already inadequate, then how long will this recovery take?”