Nevada governor urges end to spending trend

Monday, March 13, 2000 | 3:07 a.m.

Tax collections have gone up an average 8 percent a year in each of the last 10 years, unemployment is at one of its lowest levels in state history, and the state's surplus could hit $155 million by next June.

But the first-term Republican governor says state support for public schools could eat up nearly all of the budget in the next eight years if there's no change in tax receipts.

Guinn also wonders whether the strong gains in tax collections can continue. He says Indian gambling in California could cut into Nevada's tax revenue, and a southern Nevada construction boom which helped the sales tax growth is tapering off.

"It's not looking good," says Guinn, who has scheduled his first economic summit for May 4-5 in Las Vegas to outline projections on Nevada's long-range financial future.

"It's pretty evident we're going to have some shortfalls if we don't maintain that 8-plus percent growth rate," Guinn said. "And no one that I have talked to yet feels that will take place."

He also says many people don't understand state government finances, and don't realize that there's little room for maneuvering after basic programs are covered.

"A lot of people will say, 'Oh, your budget is $14 billion for two years.' That's right, but $11 billion is federal funds and that leaves you with about $3 billion or $3.2 billion in your general fund budget," Guinn said.

And to get the $11 billion in federal dollars, Guinn said the state must put up matching funds.

A governor's task force looking at ways to streamline state government is getting some good recommendations, Guinn said. But it may take several years to weave them into the fabric of government.

The administration also is looking at moving some state programs to the counties - which say they're in a financial bind.

Guinn wants to continue to strengthen education, which would require higher salaries for teachers. Without that, recruiting will suffer and teachers will remain in short supply.

The same holds true for state workers. "I'm told we have 54 positions in technology that we can't fill" because of lagging salaries, he said. "How do we move into the technological world when we can't fill the positions?"

Lagging salaries aren't the main reason for vacant state positions, however. More than 700 jobs have been held open to save money.