No deal yet on state budget cuts

Gov. Jim Gibbons said Monday he and lawmakers are about $10 million apart in deciding how to make the second round of budget cuts.

He announced a week ago the total shortfall had grown to $898 million. That is $333 million more than the January numbers, which forced 4.5 percent budget cuts totaling $564.7 million.

"We have not yet reached an accord on all of the budget reductions," said Gibbons, adding that they planned to meet again Wednesday since legislative leaders will be in town for the Interim Finance Committee meeting.

One legislator suggested the contract to complete the Carson bypass project from Fairview to the Spooner Summit junction could be delayed, but Gibbons said the state should be able to avoid any further reductions to programs and operating budgets of state agencies. That is a significant difference from a week ago when he and Director of Administration Andrew Clinger said agencies might have to cut more than $52.5 million, another 3 percent, from operational spending. January's cuts took nearly $231 million from operating budgets.

That effort got a boost Friday when State Treasurer Kate Marshall announced she has been able to sweep another $20 million from bond interest, unclaimed property and other accounts in her office. That is in addition to the $40 million in savings she turned over to the governor more than a month ago.

The largest portion of the reductions will come by practically eliminating the state's $192 million general fund Capital Improvement Projects budget. Clinger said plans are still to take $185 million of that money.

Senate Majority Leader Bill Raggio, R-Reno, said the furnishings, Fitting & Equipment money needed to open the new UNR library and other major university projects will not be affected.

Raggio said none of the CIP projects are actually being canceled - just delayed.

"And most of these, realistically, could not have been begun during this biennium," he said.

Raggio said the shifts in funding may push back the contract to complete the Carson bypass project.

Still on the table are several small pots of money, including $1 million in grants to local governments for alternative programs to help the homeless. IFC is scheduled to decide Wednesday whether to award that money or hold it.

Asked whether he would support the possible reduction or elimination of some tax exemptions, which has been suggested by Democrats, Gibbons said that would be something for the Legislature to take up.

He said last week that the reality of the situation facing the state is that it must deal with the economic slump just as the average family is dealing with it, by reducing spending.

"This is not about raising taxes," Gibbons said. "This is about spending."

Contact reporter Geoff Dornan at gdornan@nevadaappeal.com or 687-8750.