Lawmakers consider 'rainy day' schools funding bill

Nevada schools need a "rainy day" fund that would enable them to keep higher-than-expected tax revenues rather than see the money revert to state government coffers, Senate Finance Committee members were told Monday.

Panel members also considered a variety of other funding requests, including Gov. Jim Gibbons' proposal to start funding the state's $3.9 billion unfunded liability for retiree health care, and a proposal to create a state paleontologist.

Sen. John Lee, D-North Las Vegas, asked committee members to support SB416, which would create a K-12 "schools stabilization fund."

Under current law, school funding formulas are based on estimations of sales and other tax revenues. When those revenue sources exceed expectations, some money heads back to the state's general fund.

Legislative staffers estimate that at the end of this year, $186 million of such money will revert to the state's general fund, said Lee.

Lobbyists representing Nevada school superintendents and teachers said at least part of that money should stay in the schools.

Under SB416, 20 percent of the returning funds would go to the "rainy day fund."

The fund would give schools somewhere to turn in case of an economic downturn, said Lee, adding that schools would be able to apply to the fund for expensive deferred maintenance projects.

"We're trying to keep that money within the confines of education," said Lee.

Finance Committee members also heard testimony on SB547, which would create a trust fund for the governor's proposal to pay $50 million over two years toward the state's $3.9 billion unfunded liability for retired state employees' health care.

The state faces new requirements that require it to acknowledge the unfunded liability in its accounting. But Leslie Johnstone, executive director of the Public Employees Benefits Program, said that the proposal to pay $50 million toward the liability actually puts Nevada ahead of other states.

Senate Minority Leader Dina Titus, D-Las Vegas, said that with so many other budgets facing cuts, the state might be able to put a smaller amount toward the unfunded liability in this session.

"It's not as big of a threat" as some other shortfalls the state is facing, said Titus. "We're way out in front of most other states."

But Senate Majority Leader Bill Raggio, R-Reno, said it would be ill advised to spend anything less than $50 million on the problem.

"I'd rather be ahead of the curve on this situation," said Raggio. "If you put it off another two years it becomes a bigger problem."

UNLV geology professor Stephen Rowland held up a volleyball-size molar from a Columbian mammoth as he asked committee members to pass SB136, which would create a state paleontologist at an annual cost of $45,000 for a summer salary and an office assistant. The state paleontologist would issue permits for fossil collectors on state land.

"We should pay more attention to our fossils," said Rowland. "If we don't, we'll lose them."