Legislature Approves $5 Billion Nevada Budget

Nevada Budget Crisis
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Bills authorizing a record $5 billion, two-year state budget won final legislative approval after being shuffled between the Senate and Assembly on deadline late Monday and early Tuesday.

The Assembly voted 27-15 Monday for SB504, the budget authorization bill. Early Tuesday - just minutes before the mandatory 1 a.m. adjournment of the 2003 session, the Senate voted 17-3 to give final approval to AB553, the companion measure containing specific state general fund appropriations.

But while the lawmakers sent Gov. Kenny Guinn a budget, they were unable to deliver a tax plan that would fund the budget. The governor was expected to call a special session to deal with the tax issue.

The $4.95 billion spending plan for fast-growing Nevada is nearly 30 percent higher than the current $3.8 billion budget. When federal funds, fees and other revenue are added in, the total is about $13.8 billion compared with $10 billion for the current biennium.

About two-thirds of the budget goes to Medicaid, public schools and the state's university system.

The university system will spend $1.2 billion, with $982 million coming from the state. Nevada would supply $1.7 billion to local K-12 schools over the next two years.

An estimated $633 million in state money goes into Medicaid. Another $1.3 billion will come from the federal government.

Spending contained in the appropriations bill would let Nevada end the 2005 fiscal year with $123 million left over. That amount - 5 percent of the total budget - is required by law and allows cash flow to pay bills. The Republican governor may make spending cuts of up to 15 percent if the reserve falls below $60 million.

Lawmakers also agreed to put aside at least $30 million for the state's "rainy day" fund.

Total spending approved for the Division of Mental Health and Developmental Services is $377 million, of which $245 million comes from the state. The Corrections Department, including the state prisons system - gets $437 million, including $370 million in general fund dollars.

The Department of Transportation has a $1.3 billion budget, while the Department of Motor Vehicles spending includes $34.5 million for field service offices where drivers register vehicles and get drivers' licenses.

State workers' benefits and group insurance costs $500 million over the biennium. Nevada's regulation of casinos costs the state $54.4 million. Federally mandated election reforms are expected to cost $14.3 million.

The Senate voted 19-2 for legislation raising the state property tax by one cent per $100 of assessed value and issuing bonds to pay for a set of construction projects. The "no" votes were Sens. Barbara Cegavske and Ann O'Connell, both Las Vegas Republicans.

SB507, the capital improvement projects bill, includes issuance of $150 million in bonds. It was expected to win Assembly approval within hours of midnight adjournment.

Included in the measure is $32.2 million for a 150-bed psychiatric hospital in Las Vegas. Sen. Mike Schneider, D-Las Vegas, said that building would "actually save the taxpayers millions of dollars over the next few years" by reducing workload for police and other hospitals.

The measure contains money for several major university and college construction projects, including $20.2 million for a new health sciences building at the Community College of Southern Nevada's Charleston campus. There's also $60.3 million for a new science, engineering and technology complex at University of Nevada, Las Vegas.

(Copyright 2003 by The Associated Press. All Rights Reserved.)