Nevada's revenue estimate inches up by about $36 million

CARSON CITY — Nevada lawmakers hoping for some extra money from the Economic Forum to spend on public education and other budget priorities over the next two years learned Wednesday they will have to look elsewhere.

The panel of independent financial experts that sets the revenue estimates for the state budget made only modest changes to its projections for the 2013-15 spending plan.

The panel estimated about $5.85 billion in general fund revenues for the coming two years, $36 million more than its Nov. 30 projection. When a modest increase in revenue from the current year is included, lawmakers will have about $44 million more to spend in the new budget.

The difference is less than 1 percent.

Ken Wiles, chairman of the forum, said the one certainty about the panel’s projections is the uncertainty involved in setting the final numbers.

“We live in a period of tremendous economic uncertainty,” he said. “We’ve seen, even through our discussions, significant components of our estimates today that are subject to a considerable amount of information that we just don’t know.”

Those uncertainties include the economic consequences of the federal sequester to the effects of the implementation of the Patient Protection and Affordable Care Act.

The final revenue projections signal the start of the endgame for the 2013 legislative session, which must conclude by June 3 unless lawmakers or the governor call a special session.

The nearly status quo projection means little new money for public education or mental health programs beyond what has been proposed by Gov. Brian Sandoval for the budget that starts July 1. Even those modest increases in spending on such programs as all-day kindergarten and help for English language learners depend on the Legislature extending a package of taxes that will expire June 30 without action.

The $649 million in “sunset” taxes on business payrolls, retail sales and car registration for the general fund would result in a budget about $335 million, 5.4 percent, higher than the current budget. The bill extending the taxes awaits action in the Senate Finance Committee.

Sandoval has proposed redirecting about $62 million within his proposed budget for spending on public education, health and human services and state employee benefits as a result of savings in other areas, most notably in reduced costs for health insurance for state workers and teachers.

But some Democrats in the Legislature are pushing for a bigger increase in spending, by more than $300 million for public education priorities alone.

A proposed tax package is expected to be unveiled by Democrats this week, but it will face opposition from Republicans.

Sandoval has maintained a firm position against any new taxes beyond the extension of the sunsetting taxes.

Democrats do not have a two-thirds majority in either the Senate or Assembly to take unilateral action on taxes.

A half dozen Senate Republicans have proposed a higher tax on mining that would raise an estimated $300 million a year for public education, but that proposal would not take effect until the 2015 budget. It also has no support from Sandoval or Assembly Republicans, let alone Democrats.

It has been offered as an alternative for voters to a teacher-backed business margins tax that will be on the ballot in 2014.

Sandoval said Wednesday he wants to direct the new money to K-12 education, health and human services, economic development and the rainy day fund.

“Investing in our state’s children and citizens while continuing to diversify and expand our economy remains my highest priority,” he said.

Legislative leaders were not available for comment on the new projections.

Steven Miller, vice president of policy for the libertarian think tank Nevada Policy Research Institute, suggested that the additional revenue be used not to increase spending but instead to offset the effects of extending the sunset taxes.

The money should not to be doled out by lawmakers as “one shots” to their political allies, he said.

Contact Capital Bureau reporter Sean Whaley at swhaley@reviewjournal.com or 775-687-3901.