Las Vegas Sun

February 11, 2012

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The Economy:

Numbers show Nevada is most ‘distressed’ state

Service providers caught between growing need, shrinking revenue

By David McGrath Schwartz (contact)

Monday, July 20, 2009 | 2 a.m.

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Nevada’s misery could be conveyed in thousands of individual stories — of layoffs, lost homes and vanishing customers.

In the aggregate, the toll of the region’s economic turmoil can be measured in a series of staggering numbers.

Consider that 42 percent more state residents are on food stamps than a year ago and 30 percent more reached out to the county for housing vouchers and other social services over the past 12 months than a year earlier. Forty percent more Nevada children are on Medicaid than last year.

By summer 2011, an estimated 300,000 Nevadans — about 11 percent of the state’s population — will be on food stamps and another 300,000 will qualify but never apply, according to the state Health and Human Services Department.

Suffering Nevadans are increasingly turning to the government for help, as the state’s economy continues to struggle.

The numbers of people seeking government assistance “are a fair reflection of pain Nevadans are experiencing,” said Jon Sasser, a statewide advocacy coordinator for legal service agencies. “I don’t think they’re surprising. We know how bad the economy is, how high unemployment is. A lot of bad things are happening.”

Not surprising perhaps, but still hard to bear.

Nevada’s economy has been spiraling downward for more than 18 months, according to economists. On Friday, the state announced that unemployment had jumped to 12 percent statewide and 12.3 percent in Clark County, the highest levels since the state began paying unemployment benefits.

According to one index, Nevada has the most “distressed economy” in the nation. The measure, done by the Kaiser Family Foundation, combines the number of foreclosures per housing unit (one in 64), the increase in unemployment and the growth in numbers of people on food stamps. In the last measure, Nevada was the second fastest-growing.

David Rousseau, director of statehealthfacts.org, said Nevada has topped the list since January, when it bumped Florida from the No. 1 position.

Service providers, meanwhile, are being stretched between falling tax revenues and budget cuts on one side and the increase in demand on the other. They worry how governments will pay for these services if the numbers needing them continue to grow.

Those seeking services are increasing faster than the recent grim projections made during the legislative session, according to Mike Willden, director of the state Health and Human Services Department.

About 209,000 Nevadans were on Medicaid in May, almost 5,000 more than the Legislature had approved funding for.

“If our assumptions all remain the same, and the caseloads are running higher, we’re obviously in extreme trouble,” Willden said.

At Clark County Social Service, which mostly serves childless adults under 65, the department is facing layoffs and program cuts, according to Nancy McLane, the county’s director. At the current rate of spending, the department will run out of money by November.

The Legislature redirected property tax money from the county during the last session. A portion of that was designated to fund social services, she said.

Last fiscal year, the department spent $16.6 million. To keep up with the increased demand, the department would need $20 million, but she said it will instead have $11 million to $12 million under the best-case scenario, or $9 million to $10 million.

“We are going to have both staff reductions and program cuts,” she said.

McLane said the increase in people turning to the county for help began in July 2007. It spiked in July 2008, followed by another surge over the past three months.

“I’m not sure what we should see,” she said. “There are a lot of issues that people are facing.”

Guy Hobbs, a fiscal analyst and president of the consulting firm Hobbs, Ong & Associates, said the only bit of hope he has found is “some people say that the level of drops we’re seeing month over month seem to be decreasing. “We’re bouncing on the bottom right now, instead of searching for the bottom.”

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