Medicaid, health, education bear brunt of Nevada lawmakers’ cuts

Sun, Jul 19, 2020 (8:25 p.m.)

Nevada lawmakers wrapped up state's longest special legislative session since 2004 Sunday afternoon, after both chambers passed a large-scale budget cut bill meant to fill a portion of the massive $1.2 billion hole caused by the coronavirus pandemic.

The final budget cut bill took over $500 million from the state budget. Lawmakers restored some funding to Medicaid and the Department of Health and Human Services (DHHS), among other areas. However, those areas, along with K-12 and higher education, were still hit the hardest by the budget cuts.

Democrats released numbers on Thursday showing they found around $127.1 million to add back to the budget, and most of that money was funneled to DHHS. That funding included $47.56 million from the governmental services tax, which is calculated based on vehicle valuation by the Department of Motor Vehicles, $46.5 million from surplus Medicaid funding and $25 million from the Nevada System of Higher Education.

Lawmakers also softened the blow to state workers by reducing the amount of monthly furlough days from the initially proposed 12 months down to six months. Further, they returned merit pay increases for state workers, which were originally going to be cut.

Many educators and education activists, who have been speaking against K-12 education cuts throughout the session, spoke against the cuts once more in the Senate on Sunday. The Nevada State Education Association had pushed for $1 of new revenue to be put into K-12 education for each $1 taken out, and reiterated the need for new revenue in a letter filed into public comment.

“We recognize raising revenue hasn’t proven easy, but in not doing so, it will be impossible for schools to reopen following state health and safety guidelines,” the association wrote in a letter filed to public comment. “For example, Nevada has the largest class sizes in the country, and the cuts to class-size reduction would otherwise help schools figure out physical distancing in overcrowded classrooms. Monies cut from school equity programs will erase years of work to meet the needs of the most vulnerable students.”

The Assembly convened late Sunday morning, and quickly rescinded the bill’s passage from Saturday and introduced an amendment that would funnel $50 million in federal coronavirus relief funding into a block grant program for underperforming schools and students.

The addition of the schools block grant program will be administered by the State Superintendent of Public Instruction's office, and is designed to be used to implement programs for distance learning and alternative instruction needed due to the coronavirus pandemic.

The funds earmarked for the grant come from Coronavirus Aid, Relief and Economic Security (CARES) Act, and can only be used for expenses related to the pandemic, meaning they could not be used to backfill budget holes.

The bill passed through the Assembly, 36-6. The night before, without the education funding amendment, the bill passed through the Assembly on party lines, with no Republican in support. On Sunday, every Assembly Democrat voted for the bill, as well as six Republicans, including Assembly Minority Leader Robin Titus, R-Wellington. The Senate passed the bill unanimously.

“These funds are a start, but by no means the end,” Speaker Jason Frierson, D-Las Vegas, said in a statement after the bill passed through the Assembly. “We will continue to prioritize putting any new revenue towards ensuring every student has equal opportunities to education."

Senate Assistant Majority Leader Julia Ratti, D-Sparks, called the session a bridge to the next legislative session where lawmakers will do the “very hard work of reevaluating our budget under likely challenging circumstances.”

Senate Majority Leader Nicole Cannizzaro said that the decisions made by lawmakers were not easy, but stressed she thinks that Nevada "will recover, and come out in a much better spot."

"Hearing the testimony and the folks reaching out about some of these programs was quite heartbreaking and while we have not, again, solved the problem, I think there were some decisions that have eased that pain," Cannizzaro said.

Gov. Steve Sisolak had planned, ahead of the session, to call another special session afterward dealing with issues including social justice and police reform. As the session wound down Sunday, Sisolak announced that, due to rising coronavirus infection rates, he is now planning to call lawmakers back at a later date.

"To be clear: Our state is in a dangerous situation, and it is necessary for my administration to dedicate all of our time and energy toward mitigating the spread and addressing the increases we are currently facing," Sisolak said in a statement.

The forthcoming special session is still planned to address social justice and criminal justice reform issues, as well as electoral and business safety issues caused by the coronavirus pandemic, according to Sisolak’s statement.

After the special session concluded, Sisolak said he appreciated the Legislature’s work and reiterated that the pandemic had devastated the state. Sisolak has signed bills cutting capital improvement projects, changing eligibility requirements for the state’s Millennium Scholarship and giving state government a line of credit. He plans to sign a bill accelerating the collection of some mining taxes, and the budget cut bill.

"While all states are facing devastating impacts to their budgets as a result of the COVID-19 recession, Nevada once again finds itself hit the hardest due to an over-reliance on an unbalanced revenue structure and the continued need to successfully diversify our economy beyond hospitality and tourism,” Sisolak said in a statement.

Nevada, which has no personal or corporate income tax, relies largely on the travel and tourism industry to fund its state budget. But with visitation to the state taking a staggering hit from the pandemic, and with the state struggling with a resurgence of the coronavirus, Nevada lawmakers are facing one of the most dire budget crises of any state.

Multiple lawmakers expressed interest in further tackling education funding in the upcoming regular legislative session, and Sisolak said the parties must work together as the state recovers.

"Going forward, we must not focus on what divides us, but commit ourselves to the overwhelming consensus that was expressed by both parties during this session. That there are longstanding, structural problems that must be addressed to ensure Nevada is no longer the most vulnerable state in the nation every time the economy takes a downturn," Sisoslak said in the statement. "We owe it to our fellow Nevadans, most importantly our children, to seize this opportunity going forward. I look forward to partnering with legislators and community leaders on this great task ahead of us."

Lawmakers originally planned the end the session on Saturday, but a disagreement over a revived mining tax measure between Senate Democrats and Republican Sen. Keith Pickard, R-Henderson, pushed the session into the next day. The mining tax was defeated in the Senate on Saturday evening for the second time in three days, with both votes falling exactly along party lines.

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