Most of budget’s 30 percent hike to go toward Medicaid, education

Monday, June 2, 2003 | 11:22 a.m.

CARSON CITY -- The state's budget for the coming two years will grow by nearly 30 percent, with most of the money being spent on education and Medicaid, the program for medical care of the poor.

The Senate Finance Committee and the Assembly Ways and Means Committee have fashioned a spending program estimated to reach $4.9 billion, compared with the present biennial budget of $3.8 billion.

And the total state budget, when federal funds, fees and other revenue are calculated, should be around $12 billion compared with $10 billion for the current biennium.

Exact final figures are not available, but based on preliminary estimates about 67 percent of the budget will go to the public schools, the University and Community College System of Nevada and Medicaid.

The Senate Finance Committee on Sunday introduced Senate Bill 504, the bill that allows state agencies to accept federal money, fees, fines and other collections. The bill was passed 21-0 and sent to the Assembly.

SB504 includes two unusual items. It orders the state Tourism Commission to send $250,000 to the state Arts Council for allocation for design of the Las Vegas Performing Arts Center Foundation.

A second section transfers the state Printing Office, which has been in the executive branch since 1865, to the legislative branch. The office would print bills and documents for the Legislature and the Nevada Supreme Court. Other state agencies would be allowed to seek their printing needs from private companies but could seek bids from the printing office.

The Assembly Ways and Means sponsored Assembly Bill 553, which allocates state money for operations of agencies and programs.

It projects there will be an estimated $118 million ending fund balance on June 30, 2004, and $123.1 million on June 30, 2005. That represents the 5 percent of the total required by law and is needed for cash flow to pay bills.

AB553 states if this falls below $60 million, the governor has the power to make cuts of up to 15 percent in state spending.

There is $30 million put aside in the state's "rainy day" fund. And if tax collections come in faster than expected, $20 million would be added to the emergency fund.

The bill also allocates $32.5 million to the Legislative Interim Finance Committee to be used by the Taxation Department during the next two years to start collections on a new tax plan.

Both bills are ready for final passage today, but so far there is not a tax plan to supply $859 million to balance the budget.

As the budget stands now, the state would supply $1.7 billion to local school districts over the next two years. An estimated $982 million is ticketed for the university system and $633 million in state money will go into Medicaid.

Traditionally the public schools and the university have received about 55 percent of the state's general fund budget. And that's what they would receive this year under the final agreement between the two committees.

Included in the education package is a 2 percent raise each year for schoolteachers and a 2 percent raise the second year for university faculty. The state will also chip in an extra three-quarters of a percent contribution for teachers to cover the higher premiums being charged by the State Public Employees Retirement System.

State workers are scheduled for a 2 percent pay raise in July 2004. And it will cost nearly $500 million to cover premiums for the state employees and retirees during the next two years. This $500 million comes from the budgets of the agencies that pay the cost of the premiums for workers and retirees.

The budget for the legislative branch for the next two years would be $47.2 million, of which $45.8 million would come from the general fund.

Total authorized spending for the university system is $1.2 billion, of which the $982.1 million could come from the state.

Medicaid's total budget for the coming two years is $2 billion, with $1.3 billion coming from the federal government.

The state Division of Child and Family Services is approved for a $102.6 million budget, of which $61.5 million comes from the state. It includes $8.4 million for the reopening of the Summit View Juvenile Correctional Center in North Las Vegas.

Total spending approved for the state Division of Mental Health and Developmental Services is $376.6 million, of which $244.8 million comes from the state.

The two budget committees approved $437.1 million in spending for the next two years for the Corrections Department, with $370.1 million coming from the state.