Regents approve increased state higher education budget

Pretty much everyone in the room Friday morning knew what they were doing was futile, but they did it anyway.

It was the law.

So the state higher education system's Board of Regents passed a budget request for 2011-2013. They are required to submit a budget to the governor's office by Sept. 1.

But the budget request -- for a 3.2 percent increase -- will never become reality.

No one knows yet how much the state will be short in tax revenue next year, but the estimates are that the shortfall could be 40 percent or more.

The governor's office asked state agencies to submit budgets with 10 percent cuts. Most regents saw that as a waste of time.

So, they asked instead for the small overall increase to cover state mandated pay cuts that will go away.

The budget request has been called outrageous and irresponsible because it seeks a 25 percent increase in state funding. Chancellor Dan Klaich said that increase is largely because of the loss of nearly $200 million in federal stimulus money that was used to plug a state budget hole last year.

He said the request is flat -- just about the same amount the system got last time.

"I've never thought flat was outrageous," Klaich said.

Overall, the budget would fund the higher education system -- two universities, a research institute, a state college and four community colleges -- at $1.65 billion for 2011-2013, an increase from $1.6 billion this budget cycle.

About 72 percent of that money would come from the state and 27 percent from students.

The request passed with just one "no" vote, from Regent Ron Knecht, an economist from Northern Nevada.

Knecht pointed out that, despite the drum beat of budget cuts that the system has taken repeatedly since 2007, the actual spending decreased only 2 percent from 2007 to 2010.

That does not take inflation or enrollment growth of 7 or 8 percent into account. He said the "cuts" have been to what the system planned to spend compared to what it actually has on hand.

But real cuts could come next year. The state will have a new governor. The Legislature will have to deal with the revenue decline.

More than half of all state spending goes to education.

Regents said they have always complied with budget cuts when they had to.

"Every time we get a number and a dollar amount, we do our duty," said Regent Jason Geddes.

And, he said, they will do it again next year if they have to. But not until they know how much to cut.

"I don't like dealing in hypotheticals," said Regent Michael Wixom.

"Give us a number," Wixom said. "We'll deal with the number at that point in time."

Regent Mark Alden, who is often an outspoken champion of the system, said his primary job as a regent is to act as a trustee for higher education. He said the Board should not "retreat" from its support for higher ed, which he characterized as a solution to the state's economic troubles.

"Why in the -- excuse my language -- hell would you cut an education budget when we are the ones who can get this state out of this fix?" he said.

Regent Kevin Page, a financial manager, said he believes Nevada is in a depression, not a recession. He said it will take a solid education system to help pull it out. An educated work force is vital to attracting new business, he said.

"We keep talking about diversifying the economy," he said. "We never do."

Contact reporter Richard Lake at rlake@reviewjournal .com or 702-383-0307.