84°F
weather icon Clear

Deep cuts, possible tax increases on tap for special session

Updated July 7, 2020 - 5:35 am

CARSON CITY — Gov. Steve Sisolak is not ruling out possible tax increases during the upcoming special legislative session as a way to address the current year’s budget hole, which is projected to exceed $1.2 billion.

But such moves, if enacted, would be “short-term, stopgap measures” that would sustain critical public services amid the current financial emergency,” according to a report released by Sisolak’s office Monday that details the dire financial straits the state is facing as well as Sisolak’s proposed moves to balance the budget.

The governor also ruled out any consideration for new taxes or revenue sources for the special session, which is scheduled to begin in Carson City on Wednesday.

Sisolak’s plan includes massively steep cuts to state agencies that total upward of $549 million, cuts of nearly $170 million to the state’s K-12 budget, furloughs for all state and higher education employees and elimination or reduction of one-time infusions of money to several state programs.

“None of us could have predicted a pandemic of this magnitude and the global economic crisis that has followed. The world looks incredibly different since I first approved our state’s biennial budget back in June 2019,” Sisolak said in a statement included in the announcement. “The difficult fiscal decisions for fiscal year 2021 now lay ahead of us. My proposal preserves as much funding as possible for our most essential priorities — health, education and the state workforce — so they are able to continue providing the vital services on which Nevadans rely.”

The plan reiterates some things Sisolak has previously proposed, such as the furloughs for state employees. But it also adds clarity on those state-level cuts, including specific dollar amounts to be cut from some agencies and a mention that Nevada would keep vacant nearly 700 open positions in state government as a way to save money.

Some of those proposed cuts include:

■ $233 million from the Department of Health and Human Services, which would affect services of the divisions of aging and disabilities services, public and behavioral health, and Medicaid.

■ $190.6 million from the Nevada System of Higher Education.

The governor’s plan would cut $156 million from K-12 funding as well as $10 million from the Department of Education’s budget. But the plan would keep whole the state’s Distributive Schools Account, which directly funds school districts and charter schools for public education. That means that the budget cuts would not affect Nevada’s basic per-pupil funding of $6,288.

Republican state Sen. Ben Kieckhefer of Reno said Monday that Sisolak had “presented a plan that on the surface works.”

But Kieckhefer said lawmakers need to sit down during the special session and analyze how the cuts would affect the agencies and their ability to provide services, especially in the public health sector, and to hear from those agencies and the people they serve before making any final decisions.

“I think we need to figure out what it means on the street,” he said.

The report states that while the governor’s proposal balances the budget without any additional revenue, “the necessary reductions are deep and significant and will negatively impact the State and those it serves in this fiscal year, especially in the areas of healthcare and education.”

Sisolak determined that because of time constraints involved with the setup of new taxes, they would not be viable, according to the report. But it states that any increases in existing taxes passed during the special session would be a temporary bandage to keep important services afloat until lawmakers convene for their regular session in February.

“Without confirmation that federal assistance will be provided to states to help address budget shortfalls, the Governor explored and evaluated revenue options that could reduce the need for cuts, understanding that any options during an unplanned special session would be short term, stop-gap measures to help sustain critical public services until the legislature reconvenes in a regular session in 2021,” the report states.

In Nevada, any tax increase requires a two-thirds vote by both houses of the Legislature. Democrats hold a supermajority in the Assembly and could pass tax increases without a single Republican vote. The Senate, however, would be a different question, as Democrats would need at least one Republican vote in order to pass any tax increases.

On potential tax increases, Kieckhefer said it’s too early to discuss because it’s not clear what that extra money would go toward.

“It’s hard to talk about the concept of raising additional revenue until you know what you’re buying,” Kieckhefer said.

Contact Capital Bureau Chief Colton Lochhead at clochhead @reviewjournal.com. Follow @ColtonLochhead on Twitter.

Don't miss the big stories. Like us on Facebook.
Politics Videos
'Evangelicals for Trump' event draws hundreds to Las Vegas hotel - VIDEO
Hundreds of President Donald Trump’s supporters packed the Ahern Hotel in Las Vegas for a faith-based campaign event. (Las Vegas Review-Journal)
Sisolak names new DETR director, head of unemployment task force - VIDEO
Gov. Steve Sisolak named Elisa Cafferata acting director of Nevada’s Department of Training, Employment and Rehabilitation and announced Barbara Buckley as the leader of a rapid response team on unemployment insurance at a press briefing Thursday afternoon. (James Schaeffer / Las Vegas Review-Journal)
Sisolak unveils long-term COVID-19 plan with Nevada Health Response team - VIDEO
Gov. Steve Sisolak announced Monday a long-term strategy for mitigating the spread of COVID-19 in Nevada through a targeted approach. (Las Vegas Review-Journal)
Sisolak: Bars in four counties to stay closed - VIDEO
Gov. Steve Sisolak said bars in four counties, including Clark County, will remain closed to help fight COVID-19. (James Schaeffer / Las Vegas Review-Journal)
COVID-19 case reported at Legislature's special session - Video
A person who was inside the Nevada Legislature Building has tested positive for the COVID-19 virus, Legislative Counsel Bureau Director Brenda Erdoes said Friday, July 10. (Las Vegas Review-Journal)
Trump Pushing for Reopening Schools and In-Person Learning - Video
Donald Trump launched an effort on Wednesday to reopen schools across the United States with in-person learning.
Special session to tackle $1.2B budget deficit in special session Wednesday - VIDEO
Closing the state’s $1.2 billion budget hole will be the prime focus of the upcoming special legislative session that will convene at 9 a.m. Wednesday in Carson City, according to a proclamation issued by Gov. Steve Sisolak. (James Schaeffer / Las Vegas Review-Journal)
Lawmakers to tackle $1.2B budget deficit in special session Wednesday - VIDEO
Closing the state’s $1.2 billion budget hole will be the prime focus of the upcoming special legislative session that will convene at 9 a.m. Wednesday in Carson City, according to a proclamation issued by Gov. Steve Sisolak. (James Schaeffer / Las Vegas Review-Journal)
Clark County Democratic leaders resign
Several key Clark County Democratic Party leaders have resigned as progressive leadership has swelled in recent months.
Dream Big Nevada celebrates DACA ruling - VIDEO
The U.S. Supreme Court on Thursday rejected President Donald Trump’s effort to end legal protections under DACA for 650,000 young immigrants. Astrid Silva, founder of Dream Big Nevada, discusses the temporary victory and the next step for Dreamers.
Councilwoman Michele Fiore walks out of city council meeting - Video
Las Vegas Councilwoman Michele Fiore walks out of a City Council meeting during public comments.
Mitt Romney marches in Washington, D.C., protest - Video
On Sunday, Republican Sen. Mitt Romney of Utah joined a group of protesters marching through Washington, D.C. (Las Vegas Review-Journal)
Nevada gyms, bars that do not serve food can reopen Friday - VIDEO
Nevada Gov. Steve Sisolak on Tuesday evening said Phase 2 of the state’s Nevada United: Roadmap to Recovery will begin on Friday. (James Schaeffer / Las Vegas Review-Journal)
Nevada Rep. Horsford admits to having affair - VIDEO
Nevada Congressman Steven Horsford admitted to having an affair with Gabriela Linder, a former intern for Sen. Harry Reid. Linder detailed her account of the affair in a podcast she called, "Mistress for Congress." (Heidi Fang/Las Vegas Review-Journal)
THE LATEST
Sisolak signs 2 police reform bills into law

Gov. Steve Sisolak on Friday signed two police reform bills from a special legislative session. Lawmakers addressed police reform after a wave of national protests.