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At a little after 2 am on Monday March 1st, the Nevada legislature completed a special session to get our state’s budget back into balance in light of a newly projected shortfall of more than $800 million, a figure that represented a staggering 22% decline in state revenue.

Because of this shortfall, difficult and painful budget cuts simply could not be avoided. We worked hard, however, to minimize the cuts to education and to protect our most vulnerable citizens: our children and seniors.

Here’s a summary of legislation the legislature passed during the special session. If you have questions or would like more information, please contact me.

The Budget Problem

In January 2010, the state’s appointed group of economic experts, the Economic Forum, revised its earlier projections and forecast a budget shortfall of over $880 million, shortfall of 22%.

The Legislature’s goal was to minimize cuts to:

• K-12 education to avoid massive layoffs and even larger class sizes;
• Higher education to protect students and our colleges and universities, the very engines of our economic recovery; and
• Health and human service programs serving our most vulnerable citizens.

The Assembly and Senate heard hours of testimony from State agencies, school districts, union representatives, businesses, local governments, and the public. I heard from lots of concerned constituents who contacted me and participated in a Saturday legislative hearing at the Reno City Hall prior to the session.

Strategies

The budget gap has been bridged using three strategies: (1) minimizing or avoiding cuts to K-12 and higher education, health and human services, and public safety; (2) implementing government efficiencies; and (3) increasing certain fees. To mitigate the effects of the economic downturn, creating jobs was also a priority.

Minimizing Cuts

• Instead of proposed cuts of $211 million in State funding for K-12 education, the final cut in State funding will be $116.8 million.

• The school districts have been given flexibility that will help them maximize the use of their funding.

• Instead of proposed cuts of $76 million for our colleges and universities, the final cut will be approximately $46 million.

• Cuts to a wide variety of critical services for children, the disabled, elderly, and the mentally ill, as well as cuts to hospitals, have been avoided.

• The Nevada State Prison will remain open.

Implementing Efficiencies

• Approximately $10 million will be saved by cutting certain State contracts with outside consultants.

• No further cuts to the pay and benefits for State workers will be made since they took an 11% cut in the 2009 Session.

• Approximately $197 million in unspent State funds will be redirected to the priority areas of health, education, and public safety.

• By authorizing the Department of Taxation to hire new auditors and implement a tax amnesty program, the State will collect $20 million in owed, but unpaid, taxes.

Fee Increases

• Mining fees and fees on new gaming licenses have been increased.

• The fee paid by banks when filing a Notice of Default and Election to Sell has been increased from $50 to $200 and the Nevada Supreme Court will be allowed to expand the foreclosure mediation program enacted last session to include commercial foreclosures affecting small businesses.

Jobs Creation

• Using a modest amount of State and local revenues to bond for road construction and repair, an estimated 8,000 jobs will be created. In addition to providing badly needed construction jobs, this money will also make a long overdue investment in the State’s transportation infrastructure.

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