Legislators say Guinn’s tax urgency is premature

Wednesday, Feb. 20, 2002 | 9:49 a.m.

CARSON CITY -- Gov. Kenny Guinn was premature in ordering no-growth budgets for the next biennium, two key legislators say.

It's too early to talk about flat budgets, because the economy can turn around by the time the 2003 Legislature convenes in February, Assembly Speaker Richard Perkins, D-Henderson, said.

By doing so, Senate Minority Leader Dina Titus, D-Las Vegas, agreed, the governor is taking momentum from his task force on taxes.

Citing the economic downturn since Sept. 11, Guinn last week ordered all state agencies to submit budgets for 2003-05 that match annual funding they will receive in 2002-03.

However, budgets will accommodate growth in enrollment at public schools, community colleges and universities, as well as a higher number of prison inmates and more Medicaid recipients, state Budget Director Perry Comeaux said.

Perkins and Titus both noted that Guinn made his decision before the work of his Tax Task Force is done. The panel is looking at how to stabilize the state's tax structure. That recommendation is due Nov. 15.

"If (Guinn) is going with the same budgets, he's not planning on any innovative tax program to come out of his advisory committee," Titus said.

Titus and Perkins also noted that with a lack of new programs, Nevada will continue to fall behind in national rankings on social services. The state ranks 44th in the nation in per-student spending on public schools and has consistently done poorly in the annual Kids Count study that grades the welfare of children.

"I'm tired of being last in the country," the speaker said. It's time that the state project a vision of where it wants to go, he said, and "flat budgeting doesn't get us there."

But Guinn noted Tuesday one reason he ordered flat budgets was to have enough for a key priority: a pay raise for the teachers. In addition, he said, the no-growth formula "is a better way to plan for the unknown."

Guinn reiterated he will set aside $35 million to $40 million in his next budget to give schoolteachers at least a 2 percent raise starting in July 2003.

The school districts will receive enough money from the state to provide a 2 percent raise this July. There is also a section in the law that if the state's surplus reaches $154 million, there will be extra pay for teachers. Fiscal experts have said the economic downturn has made that unlikely.

The state agencies must present their proposed spending programs to Comeaux by Sept. 1. The election is Nov. 5, and the Economic Forum, which predicts what state revenue will be, reports on Dec. 1.

Guinn, who noted he must present a balanced budget to the Legislature, said he didn't want to bet on lawmakers passing some type of a tax package.

He added he didn't want agencies going to a lot of trouble preparing a wish list of items when there may not be any money to finance them.

Despite the reins on spending, government employees are still planning to ask for pay raises from the 2003 Legislature.