Lawmakers OK $505 million in budget actions to cover most of projected shortfall

The Interim Finance Committee on Friday approved using reserves, agency operating cuts and redirecting other funding to cover most of the projected $812 million budget shortfall for this fiscal year. The actions are expected to cover just over $505 million of that shortfall.

There is another $107 million in “other potential actions” they are expected to take up at their next meeting June 25.

But the vote was along party lines with Republicans led by Sens. Ben Kieckhefer and Pete Goicoechea both saying while they fully agree those cuts and changes must be made, Gov. Steve Sisolak’s administration has not been forthcoming about any of the details including what executive branch agency programs will be cut.

“We’re cutting $66 million out of the state budget but we don’t know what we’re cutting,” said Kieckhefer adding that lawmakers are giving away too much of their authority.

“The notion that this is a step in the process and we’re going to do what the governor tells us to do next is not appropriate,” he said.

Goicoechea said there are 19 days left in this fiscal year and he would like to have more hard details about what’s actually being cut before supporting the motion.

They were joined by the other Senate and Assembly Republicans on the committee.

Assembly Majority Leader Teresa Benitez Thompson, D-Reno, said she was voting for the plan but that she too supports “greater flow of information” from the administration. She said that information should be shared with lawmakers and the public.

IFC Chairman Maggie Carlton, D-Las Vegas, said the full committee will get much more detail in work programs implementing the changes ahead of the June 25 meeting. She said Friday’s vote is just the first step in the process of balancing the fiscal 2020 budget.

Sen. James Settelmeyer of Gardnerville said he believes part of the problem is that the administration didn’t start the process of cutting spending in March when the state’s economy was shut down.

“That emergency could have been made a lot softer had we done these cuts sooner,” he said.

In addition to the $66.9 million in agency spending cuts, the total now approved includes $21.5 million in reserves of one-time appropriations from the 2019 Legislature, the $401 million taken from the Rainy Day Fund, reversions of a half million dollars from money left over from Capital Improvement Projects, taking $10.1 million in federal funds reimbursing the state for construction of the Northern Nevada Veterans Home and a host of smaller adjustments.

Those actions get the total to $505 million. In addition, there is the $107 million in other potential actions, a list that includes taking back the $25 million approved to build the UNLV Medical School.

Added up, all those actions come to $611.9 million of which, $561.8 million is the projected General Fund shortfall. When that projected shortage is added to the $265.3 million the General Fund owes school districts for the 2020 year, the total is $811.9 million.

Of the $66.9 million in executive branch agency cuts proposed by the governor, two-thirds of the total come from just three places — the system of higher education, freezing NSHE the cash to pay state worker salary increases approved in the 2019 session and the Health and Human Services Department. HHS has been asked to cut $19.1 million and NSHE $14.4 million. Freezing salaries will save the state $12.7 million.

Added together, those three pots of money make up 69 percent of total agency reductions.