Researchers feel squeeze: Funding for higher education in jeopardy

Jennifer Knight

Friday, April 27, 2001 | 11:16 a.m.

Lambus Papelis, sitting in his Las Vegas laboratory, searches for clues that will tell him more about how water and different elements interact with environmental contaminants.

In Reno, Craig Beattie researches how communicable diseases and cancer invade the human body.

And, when the Earth rumbled throughout Seattle on Feb. 28, seismologists at the University of Nevada, Reno, sprung into action to assess the damage.

All of these labs were set up with ESPCoR funds, money derived from estate taxes. The Experimental Program to Stimulate Competitive Research helps smaller states such as Nevada compete against larger institutions for research funding. In the research world, it acts as the great equalizer.

"These dollars are critical for this state's ability to train students in science and technology," said Jim Coleman, vice president for research and business development at Desert Research Institute and director of Nevada's National Science Foundation and ESPCoR.

Coleman said Nevada's portion of estate money has been used to attract bigger donors. This year alone the institute is expecting to receive $3 million in grants, which will be parlayed into $15 million more in federal matching funds.

Funding that helped put Nevada on the map in areas of climatology, seismology and genomics could be eliminated by Congress this session if the Death Tax Elimination Act of 2001 is approved.

"This area could become a new tech center, and without ESPCoR, it's not going to happen," said Beattie, a professor of genomics at UNR and chairman of the Animal Biotechnology Department. "This is an investment in Nevada's future. I'm tired of seeing other kids coming out of school and going to other states."

Although the bill affects only 0.7 percent of taxpayers, estate taxes can be expensive. Any estate worth $675,000 or more can be taxed up to 55 percent upon the death of the estate owner.

Republicans tried to stop that tax last year when a similar bill was approved by Congress. It was quickly vetoed by former President Bill Clinton. President Bush, however, has promised to sign this year's bill, which has already been approved by the House.

The issue has crossed party lines. Although Sen. Harry Reid, D-Nev., does not support the bill -- he backs an amendment to the estate tax bill that would raise the income cap instead -- fellow Nevada Democrat Rep. Shelley Berkley is co-sponsoring the repeal.

"Any shortfall due to a repeal of the estate tax, the congresswoman would fight for educational funding for Nevada in order to offset that amount," Michael O'Donovan, Berkley's spokesman, said.

"That's a really dangerous pot of money to take away," Coleman said. "The last thing you want to do is take away the money that gets you money."

The local scientific community and the larger academic community have opposed the bill. Unlike most states, Nevada put all of its estate tax revenue into education -- half to higher education, the other to primary education.

"As the budgets go down further and further, I think you have a lot of governors concerned with the tax going away," Nathan Naylor, press secretary for Reid, said.

The university and community college system is expecting some hard hits to the system already. Although the death of estate taxes is a long-range problem for the state -- if approved it will be phased out over several years -- this biennium is expected to be particularly tough.

Aside from the threat of vanishing research dollars the state is expecting serious budget cuts.

Early guesses of state revenue indicate the budget will be short by 15 percent. Some legislators are predicting that when the Economic Forum issues the estimates used for the final budget, the shortfall may be three times that.

"It's sounding very bleak about the Economic Forum. I've had people tell me it is up to $150 million," Assemblywoman Barbara Cegavke, R-Las Vegas, said.

Requests for things such as matching funds for ESPCoR grants, as well as funds to build new infrastructures throughout the university and college system, could be cut.

The system faces further problems with its operating budget. Just last week higher education officials announced a $6 million deficit in an account used to supplement several faculty positions and fund student scholarships. More money is being paid out than the account earns.

In addition, the endowment money that the system relies on has taken a $15 million dive because of the stock market's poor performance.

According to many higher education officials, it doesn't appear it will be good year for higher education.

"We are going to get squeezed depending on what (lawmakers) approve," said Dan Miles, vice chancellor of finance for the University and Community College System of Nevada. "Generally, it's been my experience that when times get tough, higher education is one of the programs that suffers the most, because it is not theoretically a mandatory program."