Lawmakers slice $75 million from budget

Lawmakers approved more than $75 million in budget cuts on Thursday " enough to get the state through the rest of this fiscal year " even though they fretted over the damage it will cause to Health and Human Services programs.

"We've had to make some cuts some of us couldn't live with but have to live with," said Assembly Ways and Means Chairman Morse Arberry, D-Las Vegas.

"This is making us look like the grim reaper," he said. "I'm not happy with what we are voting for."

Assembly Speaker Barbara Buckley, D-Las Vegas, said she too was unhappy with the cuts to services, reduction in hospital and other provider rates and other cuts.

"But we have to balance the budget," she said. "We have to make these tough cuts."

Sen. Bob Coffin, D-Las Vegas, said he would refuse to go along with reductions to the agency budgets approved by the 2007 Legislature.

"They were built with a lot of thought. They are being taken down without thought," he said. "We seem to just be going along with the governor. The governor has no agenda other than to reduce."

He called instead for temporary tax increases to cover agency needs until the 2009 Legislature can change the state's tax structure.

They were joined by a variety of advocates for seniors, the poor, the disabled and others who all expressed concern unless the 2009 Legislature does something to raise more revenue, programs and services for those most in need will be irreparably damaged. Several of those advocates said tax and fee increases are the only answer.

Jan Gilbert of the Progressive Leadership Alliance of Nevada said that group will bring a tax proposal to the Legislature designed to more fairly distribute the tax burden. She said under Nevada's current tax structure, the poorest residents pay a much larger percentage of the income in taxes than the richest and argued that must change.

Most of the cuts on the list are the result of holding positions throughout the executive branch vacant. Every state agency is losing positions from human services to forest rangers, public safety to cultural affairs.

Many more cuts, especially within Health and Human Services, will result in reduced services to everyone from the disabled to the poor and the mentally ill. In addition, nearly all of the rate increases granted providers of medical, social and other services by the 2007 Legislature will also be taken back.

After reviewing the proposals presented by the agencies, budget office and legislative fiscal staff, the panel approved them with only a couple of changes.

The first followed a plea by Sunrise Children's Hospital, which said without some help, a 5 percent reduction might force them to refuse Medicaid patients in dire need of expensive, complex medical procedures. CEO Todd Sklamberg said that even before the 5 percent rate reduction ordered in the list of cuts, they were receiving just $1.447 for procedures costing upwards of $67,000.

He said Sunrise is the only Nevada hospital capable of performing certain complex medical procedures on children and infants.

"We're talking about actual costs, not billed charges." he said. "If we cannot obtain relief, we're going to have to consider no longer performing procedures for Medicaid patients."

At HHS Director Mike Willden's suggestion, the Interim Finance Committee agreed he and his staff should negotiate a reimbursement price with Sunrise on a case-by-case basis.

Sunrise officials said that would permit them to continue providing services to all who need them whether they have insurance or not.

The second change was agreeing not to close the Owens District welfare office in one of the poorer areas of Las Vegas. The committee agreed not to close it down after Las Vegas officials said they would pay the $147,000 it will cost to keep the office, described as one of the state's busiest welfare centers, in business through June 2009.

But Willden said it is still on the "chopping block" for the 2010-2011 budget cycle.

Las Vegas City Councilman Ricky Barlow said that still gives the city, advocates and Willden's office time to work on a way to keep it open.

The approval is contingent on action by the Las Vegas City Council to make that payment.

The cuts implement the 3.42 percent reduction in the current budget needed to bring general fund spending down to projected actual revenues.

The easiest to approve was the Public Employee Benefits Program premium holiday that freed the state from having to pay $25.4 million in July premiums for state worker benefits. The premiums were paid, instead, out of excess reserves in the program.

The reductions to 132 other state agency programs approved Thursday total $52.2 million, the majority of which " $31.5 million " comes out of Health and Human Services. And that damage, Assemblywoman Sheila Leslie, D-Reno, pointed out, is nearly doubled because state cutbacks loses a roughly equal amount of federal matching funds for programs including Medicaid and welfare. More than $9 million more comes from the Department of Corrections.

Reductions approved Thursday total $77.6 million. But lawmakers aren't finished with this fiscal year's cuts yet. They have another $55.2 million to cut from budgets including education, the university system, Supreme Court, legislative branch and the constitutional offices of the treasurer, attorney general, controller and secretary of state.

The majority of those reductions are $22.2 million from the system of higher education and $28.7 million from public education spending.

Those and the other budgets on the list will be discussed at IFC's Sept. 9 meeting. When those decisions are made, it will complete the $275 million in cuts ordered by the June 27 special session of the Legislature.

Altogether, that brings the total general fund reductions made since the budget crisis reared its head last October to just under $1.2 billion. the vast majority of that total came from one-time spending " including nearly everything in the state's capital improvements and infrastructure construction budget.

The big challenge, however, will be putting together a 2010-2011 biennial budget which makes those spending reductions permanent in the face of inflation and growing needs in the state.

Gov. Jim Gibbons has ordered agencies to submit tentative budgets which are 14 percent smaller than the budgets approved by the 2007 Legislature to balance revenues against expenditures.

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