Special Session Ends In State Capitol

CARSON CITY, Nev. (AP) - More state services would be cut and
students would have fewer new textbooks under a budget deal
approved late Friday in a 12-hour special session of the
Legislature called to solve a $275 million budget deficit.
Both the Democrat-led Assembly and Republican-run Senate voted
to approve the package of spending cuts, one-time expenditures and
budgetary maneuvers. Republican Gov. Jim Gibbons indicated Friday
he was likely to approve the plan.
"They're all terrible choices," said Assembly Speaker Barbara
Buckley, a leading architect of the deal, along with Senate
Majority Leader Bill Raggio, R-Reno. "I believe we should never
have to make these kinds of choices ever again."
Gov. Jim Gibbons on Thursday called the Legislature into the
rare special session to address the state's financial woes. A
housing crisis and slowing tourism industry have left the state
facing a $1.2 billion shortfall in the current two-year budget
cycle. Lawmakers and the governor already have slashed operating
budgets, delayed building projects and drawn down the rainy day
fund to make up $914 million of the gap.
Under legislation approved Friday, the remainder will be closed
by an additional 3.3 percent cut - $106 million - in reductions to
agency's operating budgets. The specific cuts will be proposed by
each agency head and negotiated through the Interim Finance
Committee. Lawmakers also will tap a school textbook fund for $48
million and delay or cancel $50 million in transportation projects.
The school textbooks move caused the most public rancor among
lawmakers and divided Democrats. While all but one of the 27
Democrats in the Assembly approved of the proposal, nine of 10
Democrats in the Senate rejected it.
As he voted against the measure, Minority Leader Steven Horsford
said he wanted to balance the budget but he "could no longer do it
on the backs of children and public education."
The deal was crafted and won tentative approval from Gibbons
early in the day. The governor had sought deeper cuts to agency's
operating budgets and wanted to protect the textbook funding.
However, he was not in a strong bargaining position.
In a televised speech Thursday, he described the budget passed
last session as "excessive." The comment antagonized Raggio, a
crucial ally facing a tough re-election battle and sensitive to
being seen as a tax and spender.
"My recollection is the governor proposes a spending level in
the budget," Raggio told reporters. "The governor did not
recommend in his budget any reduction in spending levels."
The governor struck a conciliatory tone late Friday, saying he
did not intend to lay blame on the Legislature. Of the budget deal
he said: "I think basically we don't know of any problems at this
He will begin reviewed the final bills Monday, he said.
Despite talk of preserving education funding, it was gambling
industry that faired better than schools.
The casino lobby successful killed a bill aimed at guarding more
than $100 million in tax revenues already collected by the state.
The issue arose out of a March Supreme Court decision ruling the
state had wrongly been collecting taxes on complimentary meals
provided to employees at casinos.
The legislation, which passed the Assembly, would have clarified
the intent of the tax law with an eye toward bolstering the state's
case when the court reconsiders the ruling.
Faced with stiff opposition from the gambling lobby, Republicans
in the Senate killed the vote in committee.
Sen. Randolph Townsend, R-Reno, said he believe the court will
side with the state without the clarification.
"I would recommend that we really give no further consider to
this, because there is a process in place," Townsend said.
The food tax bill would have had no affect on the $275 million
deal. Several other proposals pitched and debated by the Senate on
Friday were not directly tied to budget-balancing deal.
Sen. Steven Horsford, D-North Las Vegas, proposed a commission
to oversee spending on education. It died in committee.
Sen. Dina Titus, D-Las Vegas, suggested lawmakers ought to amend
state fuel tax law so that Nevadans could benefit from a "gas tax
holiday" being discussed in Congress.
Nevada is among a handful of states where such a law would have
no affect on the price of gas.
"This is most unfortunate because Nevadans are being squeezed a
the pump like never before," said Titus, a Democratic candidate
for Congress.
The measure was rejected and dismissed by Raggio, who asked if
there were "any other campaign speeches to be made."