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Report outlining tax and spending decisions by 2011 legislature now available


By Sean Whaley, Nevada News Bureau: A report outlining the actions taken by the 2011 Legislature to finalize Nevada’s two-year, $6.2 billion general fund operating budget that took effect July 1, including approval of $1.1 billion in additional revenues, has been published by the Legislative Counsel Bureau.

The Nevada state Senate in session, 2011. / Nevada News Bureau file photo.

Gov. Brian Sandoval initially proposed a $5.84 billion general fund budget that relied heavily on local government revenues to balance out, a decision that was later called into question in a Nevada Supreme Court decision.

The $6.2 billion general fund budget is actually less – but only by about $100 million – than the 2009-11 spending plan.

When all revenues are counted, including federal funding, the current two-year state budget totals $15.9 billion, down from $16.5 billion in the 2009-2011 budget.

The Nevada Legislative Appropriations Report for the 2012 and 2013 fiscal years summarizes the actions of the Legislature in funding public education, corrections and other agency budgets. Prepared by the Fiscal Analysis Division, it also contains sections on tax revenues.

The final spending plan was augmented by revenue increases totaling nearly $1.1 billion over the 2009-11 budget, with $513 million of the total going to the general fund and $556 million to public education.

Sandoval’s original budget did not propose to continue a number of tax increases approved by the 2009 Legislature that were to sunset on June 30, 2011. But in an agreement with lawmakers late in the session, the tax sunsets were removed for two more years to help balance the budget.

The agreement came after the Nevada Supreme Court ruled that $62 million taken from a Clark County water fund in the 2010 special session to help balance the previous budget was unconstitutional. This ruling raised doubts about the legality of a number of proposals in Sandoval’s budget to use local tax revenues to help balance the state budget.

The bipartisan agreement to extend the taxes for two more years came as part of an overall deal to approve major reforms to public education and public employee benefits.

One of the major pieces of the tax agreement was to keep the tax rate for the modified business levy at 1.17 percent of wages, bringing in $237 million over two years. The first $250,000 in wages was completely exempted from the tax, however, as a break to Nevada small businesses.

Another $283 million is being generated by maintaining a 0.35 percent sales tax increase for the current two-year budget to help support public education.

The report shows that 37.5 percent of the general fund budget is directed to public education, down from 39.9 percent in the previous budget. Higher education is receiving 15.3 percent of the total, up from 15.2 percent in the previous budget. Human resources spending totals 31.2 percent, up from 29.1 percent in 2009-2011. The remaining 16 percent is divided among other agencies, including corrections, public safety and the constitutional offices.

The report also shows a reduction in the number of state positions. In fiscal year 2011, which ended June 30, there were 18,431 approved positions in state government, not including the higher education system. For the current year, the number of approved positions is 17,856, a reduction of 575 jobs.

The Nevada System of Higher Education saw a bigger percentage decline, from 7,166 professional and classified jobs in 2011 to 6,789 positions this year, a reduction of 377 jobs.

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