Nevada dents welfare surplus, advocates say state should spend more

Brendan Riley

Sunday, Nov. 14, 1999 | 10:54 a.m.

CARSON CITY - Nevada is piling up such a big surplus in federal welfare funds - nearly $18 million by next June - that advocates say it can easily give the state's poorest people their first grant increase in nearly a decade.

The surplus developed because the number of Nevadans getting assistance has dropped dramatically since 1996 congressional reforms - from a high of more than 42,000 to less than 17,000.

Nevada used to spend $50 million a year on welfare grants - and now it's just $27.6 million. The surplus is now about $10 million, and that figure should climb to nearly $18 million by June and $25 million by mid-2002.

Advocates for low-income Nevadans are proposing a raise in the basic welfare grant to just under $500 a month, using up about $9 million of the surplus.

Nevada's current grant, averaging $348 for a family of three, is so low it's "inhumane," says Marci Wehry of the Nevada Empowered Women's Project.

"It's now apparent that there will be a bigger surplus in the future, and it should be funneled back into a program that is giving people barely enough to survive," adds Jan Gilbert of the Progressive Leadership Alliance of Nevada.

Poor unemployed people now have to make an extensive job search to get welfare money, "so it's not like they're on the rolls forever. At least we could give them a decent grant while they're on assistance," Gilbert said.

The push for a grant increase follows an Oct. 1 cutoff date for spending federal money left over from previous years on ancillary services - anything other than cash grants and other basic needs.

The advocates suggest basing grants on 60 percent of the basic need level in 1999. The state now uses 1991 - the last year basic grant levels were raised in Nevada - as the "need" year.

The idea already has been presented to Gov. Kenny Guinn's administration, and will be reviewed at a state Welfare Board meeting in Reno on Monday.

Mike Willden, deputy chief of the state Welfare Division, says his agency isn't considering raising the grants at this point. But he says Nevada has come a long way in using extra welfare funds to expand various ancillary services, such as teen pregnancy and domestic violence prevention programs, transportation and child care assistance for the working poor, job training, and bonuses for staying on the job.

A few states have gone farther, spending down their entire surpluses. But others have hoarded most of their money.

Nevada is somewhere in the middle, hanging onto enough money to provide basic grants to more people if there's an economic downturn that could boost the welfare rolls again.

"We want to set enough aside in case the economy turns bad at some point," says Willden. "But we're continuing to look for services that families need."

If the new services that exist now hadn't been funded, Willden adds that the surplus would probably be double its projected level.

Nevada raised child care program payments from $3.3 million to $18.7 million; welfare-to-work program spending went from nothing to $1.1 million; and contracts with various non-profits went from zero to nearly $2 million between fiscal 1996 and 1999.

By June, Nevada's surplus will represent about 10 percent of federal welfare money received since 1996. Almost two-thirds of the states are holding onto much more - 15 percent of the funds they got in that period.

Only Illinois, Delaware and Maine have spent their entire share of federal dollars, according to the Center for Budget and Policy Priorities in Washington, D.C.