Governor preparing recommendations for stimulus spending

Gov. Jim Gibbons is preparing a "budget supplement" with his recommendations for how to use the money the state is getting from the federal stimulus bill, he said in a podcast posted to his Web site Wednesday.

"It's important to know what the stimulus dollars will and will not do," Gibbons said. "The stimulus money will not erase the multibillion-dollar budget deficit facing the state, and it will not alleviate the need for elected officials in Carson City to make tough decisions to balance the budget. Stimulus dollars will, however, allow the state to offset some budget reductions."

Some, but not all. As Gibbons notes, even with the $1.5 billion shot in the arm from the federal government, cuts will still have to be made.

"Legislators have been having hearings on this for weeks," said Assembly Speaker Barbara Buckley, D-Las Vegas. "We welcome any input the governor has, but we're already doing this."

Gibbons stressed in his video statement that since the stimulus money is a one-time thing, it shouldn't create obligations that the state will have to meet down the road.

"I will not support any use of stimulus dollars to create new or expanded government programs that will require continued funding from the estate," he said. "The stimulus dollars are meant to slow down the economic downturn and preserve core government services. These dollars should not be seen as an opportunity to fund pet projects."

Nevada's rising unemployment has increased the state's Medicaid caseload, Gibbons noted, and "we have a social and moral responsibility to ensure that Nevadans who lose their jobs through no fault of their own are not left in the cold when it comes to health care."

The stimulus bill gives the state $450 million in Medicaid funds. By offsetting money the state otherwise would have devoted to that purpose, that money will free up funding that the state can then devote to other areas, such as education, Gibbons said.

Buckley said she agrees with Gibbons that stimulus funds mustn't create ongoing government commitments and that cuts will still have to be made. "We appreciate him stating the obvious," she said.

"It's very important that everybody realize that this is one-shot money," she said. Preliminary staff analyses indicate that only $500 million of the stimulus dollars can go into the state general fund for education and Medicaid, while the state budget shortfall has been pegged at $2.4 billion. "It certainly is not the answer to all our state's budget woes," Buckley said.

Gibbons' statements about the government's responsibility to fund health care struck Buckley as disingenuous, however, considering that his proposed budget would cap the number of needy children who could participate in a state health insurance program, possibly reducing the program's existing enrollment.

Contact reporter Molly Ball at mball @reviewjournal.com or 702-387-2919.