Nevada Governor Gibbons to Outline Budget, Goals

By: Brendan Riley, Associated Press
By: Brendan Riley, Associated Press

CARSON CITY, Nev. (AP) - Nevada Gov. Jim Gibbons is expected Monday to detail what he terms significant policy changes in the way taxpayer dollars are spent, and to unveil a record $7 billion state budget for the coming two years that depends on no tax increases.

The proposed state general fund spending, up nearly 20 percent over the amount approved by state lawmakers in 2005 for the current two-year budget cycle, will more than double when funds from other sources, mainly the federal government, are added in.

The newly elected Republican governor is expected to stress a "one Nevada" theme in his planned 35-to-40-minute State of the State address, which he is practicing over the weekend behind closed doors in the Assembly chambers. That's where he'll deliver his address on Monday.

The unity theme would echo his promise, when he was sworn into office on New Year's Day, to seek common ground with Democrats and to avoid conflicts that might pit one part of the state against another.

More than half of the proposed $7 billion in general fund spending is for the state's K-12 schools and the university and community college system; and more than a quarter of the funds are for human services programs, including Medicaid and mental health services.

About 10 percent of the state general fund revenues would be used for public safety, including the state's prison system. The balance of the spending in the governor's tentative budget would go to commerce and industry-related agencies, constitutional offices and other special-service government operations.

A third of the projected revenue that would support the spending comes from sales and use taxes, and another third comes from fees and taxes paid mainly by casinos. The balance comes from various insurance and business levies, real estate transfer taxes, secretary of state fees and from taxes on liquor and cigarettes.

Gibbons had provided a few details about his spending plan in advance of his speech, including his opposition to any new or increased taxes.

The governor also wants to start reducing a looming $10 billion liability to cover future pension and health care costs for the state's retired public employees.

Gibbons also has proposed selling water rights beneath Nevada state highways as a way to help cut into a $3.8 billion road construction funding shortfall. However, state transportation and local and private water company officials have said that wouldn't make much of a dent in the shortfall.

The governor also may endorse public-private road projects in which private investors would recoup their money through tolls paid by motorists. A state task force seeking ways to reduce the shortfall discussed the concept last year.

Gibbons' 2007-09 budget plan also won't back the expansion of all-day kindergarten that was proposed in former Gov. Kenny Guinn's draft budget. Currently, all-day kindergarten exists only as a pilot program in schools considered at-risk.

Also, Gibbons wants to give state workers raises of 2 percent in the first year and 4 percent in the second year of the two-year budget cycle that starts next July.

Guinn's budget recommendation was that state employees and school teachers be given 3 percent salary increases in each of the next two years. But Gibbons said his change will save the state $30 million to use to reduce the unfunded liability.

Under new federal accounting rules, state and local governments must begin reporting on their books the unfunded liabilities they face. They aren't required to reduce the liabilities, but failing to do so could affect their bond ratings.

Gibbons' budget also provides for $268 million in spending for prison expansion projects, including 400 more beds at the state prison for women and two more housing units at the High Desert prison for men.

The governor's recent comment that his speech would focus in part on a significant departure in government spending caught lawmakers off guard, prompting one legislator to note that the Legislature determines the final amount of the budget - and the final figure isn't likely to exactly match what Gibbons will propose.

Gibbons' promise of big changes departed from an earlier statement that he planned to leave only "some small fingerprints" on state spending but didn't have time since the Nov. 7 elections to make too many changes to former Gov. Guinn's draft budget.

Besides government spending, Gibbons, a former fighter pilot, plans to include a tribute to the military in his State of the State speech. He has described the speech as one of the most important of his political career, which has included stints in the state Assembly and Congress.


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