CARSON CITY, Nev. (AP) - Lawmakers will have slightly more room to expand their general fund spending under current law after a state panel on Wednesday came up with a revised forecast of revenue.
The state's Economic Forum, a panel that provides forecasts for the state's general fund revenue, met Wednesday and approved a forecast that increased a December projection of theirs by an extra $42.8 million for fiscal years 2019 through 2021.
Lawmakers could use those funds in building the next two-year budget, said Russell Guindon with the Legislative Counsel Bureau.
The Economic Forum, a panel of five economic and taxation experts from the private sector, was created during the 1993 Legislature. All state agencies, including the governor and the legislature, are required to use the forum's forecasts.
A budget from Democratic Gov. Steve Sisolak states that 35 percent of revenue sources for the 2019-2021 budget come from the general fund.
Sisolak's budget outlines a 3 percent cost of living pay increase for public school employees and a 2 percent merit pay raise.
But The Kenny Guinn Center for Policy Priorities estimates that budget is short $107.5 million in providing those increases while keeping per-pupil funding the same.
Kenneth Retzl, director of education policy at the center, said the figure is a base estimate for the shortfall because it does not include other factors like inflation.
Sisolak said in a statement that the Economic Forum report Wednesday shows the state "has the fastest growing economy in the country and continues to outpace the rest of the nation in terms of job growth."
"For the remainder of this session, the legislature and I will work together to build a structure upon which we can transform the way we fund our schools in the years ahead," his statement said.
Dan White, director of government consulting and fiscal policy research at Moody's Analytics, told the Economic Forum that Nevada is seeing exceptional rates of job growth.
"Nevada is the fastest-growing economy in the country right now, in terms of just the overall number of jobs that are coming online," he said.
He described the U.S. economy as strong and told the panel that the country has one of the tightest labor markets it has ever seen. Yet he also predicted a recession or an economic slowdown by the end of 2020.
A tight labor market is generally when recruitment for open jobs becomes more difficult for businesses.
Republican Assemblyman Jim Wheeler issued a statement saying Sisolak and other Democrats are "trying to spend more money than is available."
"Governor Sisolak's promise of no new taxes is going to be put to the test based on today's report," Wheeler said in the statement.
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Statement from Governor Sisolak:
“Today’s Economic Forum report shows that Nevada has the fastest growing economy in the country and continues to outpace the rest of the nation in terms of job growth. We've also made significant progress in diversifying our economy over the last decade, and I am committed to ensuring economic development is a priority for Nevada in the years ahead so our economy can keep pace with our robust population growth.
“In addition to the Economic Forum reporting increased stability in our state's employment and economy, it also showed we will receive an additional $42.8 million in projected revenue for Fiscal Years 19-21. While the first Economic Forum report of my administration is positive overall, we must do more to ensure our economic success reaches every Nevadan across the state – and that starts with our educators and working families.
“For the remainder of this session, the legislature and I will work together to build a structure upon which we can transform the way we fund our schools in the years ahead. Over the next biennium, my focus will be on determining how best to strengthen our public education system, which is the foundation of any long-term economic development and diversification."
Assembly Republican Caucus Statement:
“Today’s projections show that there are going to be some very difficult decisions made between now and the end of session. Simply put, there is not enough money to go around. Many of the recommendations to expand government by the governor and the bills in Assembly Ways and Means and Senate Finance are not conducive to our current economic environment. I hope we see fiscal responsibility and not the easy path of dipping into Rainy Day Funds, which truly should be used during economic declines,” says Assemblywoman Dr. Robin Titus.
“I am concerned about much of the proposed legislation that has yet to reach the governor’s desk. The Economic Forum showed us that we are facing an imminent slowing of growth in Nevada’s economy,” says Assemblyman Al Kramer. "From rolling back measures that will cost the state millions to pushing legislation that will increase the cost of doing business in Nevada, we will accelerate and compound the effects resulting in a longer and deeper economic downturn."
“Governor Sisolak’s promise of no new taxes is going to be put to the test based on today’s report. In its simplest terms, the Governor and the Democrats are trying to spend more money than is available. How will Democrats keep their promise to teachers and unions while still balancing the state budget? Nevada's booming economy is benefiting from the reforms and policies under Republican leadership. Now is not the time for budget experiments that will constrict our economic growth," says Assembly Republican Leader Jim Wheeler.