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Stumble$2.5 billion state budget deficit: ‘Best-case scenario’
Friday, April 23, 2010 | 2:01 a.m.
Andrew Clinger
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Sun archives
- Gibbons signs budget bill; state draws M Resort lawsuit (3-12-2010)
- Budget gets OK as session ends; sales tax extended for roads (3-1-2010)
- Bipartisanship emerges in anger at Gibbons over session deadline (2-25-10)
- Democrats: Trim education cuts to 5 percent (2-24-10)
- Gibbons adds to agenda, says session will end by Sunday night (2-24-10)
- Relationship between Gibbons, Raggio shows strain on Day 2 (2-24-10)
- Plan to use cameras to catch uninsured motorists appears dead (2-24-10)
- Gibbons’ budget plan risky in an election year (2-24-2010)
- Proposal to close state prison meets opposition (2-23-2010)
- Budget crunchtime: Lawmakers set to tackle historic deficit (2-23-2010)
- State budget comes up $800 million short (8-22-2010)
- Forecast: Economy will begin to rebound in mid-2011 (1-22-2010)
- Gibbons’ no-talk order further divides branches (1-22-2010)
- Special session may require help of state Supreme Court (1-10-2010)
During Nevada’s last knockdown, drag-out tax fight, in 2003, a key attack on those seeking to raise taxes was that they had inflated the state’s deficit to justify their proposal.
With budget officials estimating the state will face a $2.5 billion to $3 billion shortfall when the 2011 Legislature convenes, some conservatives are casting doubt on those figures — even though the source is the budget office of Gov. Jim Gibbons, hardly a pro-tax source.
Considering the state’s current biennial general fund budget is $6.4 billion, the alarming nature of the estimate comes into sharp relief. It’s also why most veterans of the state budget process think a tax increase is all but inevitable, regardless of ideology or campaign promises from governors and legislators.
So what is the deficit number?
State Budget Director Andrew Clinger is responsible for the $2.5 billion to $3 billion estimate that has been circulating. He said this week, “We’ll be lucky if we’re only at
$2 billion. I think $2.5 billion is the best-case scenario.”
The following are examples of money the state is currently relying on to fund operations that won’t be available as the state builds its next budget:
• $649 million in one-time federal stimulus funding the 2009 Legislature used to balance its budget but won’t be available unless there’s another federal stimulus.
• $939 million in new taxes passed by the 2009 Legislature, which will expire beginning in 2011.
• $220 million in room-tax revenue, which was used for the general fund in 2009 but will now be dedicated to K-12 education.
• $287 million in one-time gimmicks — emptying bank accounts and raiding local government accounts, carried out during this year’s special session.
• $300 million in savings from furloughs passed by the Legislature that are scheduled to expire in 2011.
That totals $2.4 billion — before the recession’s effect on tax revenue is factored in.
Increased costs of state programs, such as more people enrolled in Medicaid or in schools, higher utility bills, building maintenance, health care costs and employee salaries have historically added about another $1 billion in “roll-up costs” to the state’s budget. During the 2009 session, that was reduced to $469 million, according to news reports.
The final projections the governor and Legislature will use to set spending levels won’t be made until December. In those discussions so far, Clinger’s office has been the most pessimistic, and, it has turned out, the most accurate.
Will his predictions be accurate again?
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End recreational drug enforcement and prosecutions, put sales tax on food (exempt if paid for with food stamps),
Also, out of state syndicated talk radio broadcasters like Hannity and Limbaugh should be subject to income tax if they are heard in Nevada.
This article points out the goal of some is simply to raise taxes. Whatever the reason, taking more from some to spend on or give to others is the role. That is the sum of the difference between the progressives and the rest of the country. One side believes people should provide for themselves and the other believes whatever you earn must be shared with those who don't.
Neiman, NICELY PLAYED, you have followed the Gym Gibbons/Tea Party book of B.S. to a TEA!!!
GUESS WHAT!
We either come up with some solid, reliable revenue streams, and make MINING AND GAMING pay their fair share, or we SHUT THE DAMN LIGHTS OFF and close Nevada.
THEN you can have your silly YUCCA MOUNTAIN NUKES NATIONAL PARK.
gmag, you're right. The answer is just to take more money from the people that live here instead of balancing the budget. That's what I do with my finances. I spend all the money I want, rack up a bill on the credit card, take from family and friends, rob the fountains of loose change and then .........At what point does it stop. Cut the programs that aren't necessary and get back to a government that does what it was originally intended to do. Whether you support the Tea Party or not, every American should be clamoring for government to take responsibility instead of passing the buck to the tax payer.
porkulus.
This is yet another example of why we MUST change the Constitution and remove the protections that the mining industry has against paying taxes in our state. They remove billions of dollars in precious metals and oil from our state every year without even coming close to paying 1% in taxes. The industry claims they pay other taxes, but then get to write those taxes off what they pay the state. No other individual or business gets to do that! Everyone reading this article pays between 10 and 20 percent of their income in taxes and fees. Those taxes and fees are going to go up next year and we will have even less to show for it.
PLEASE get involved before things get any worse:
www.nevadafairminingtax.org
Michael1971, they should start by enforcing the current tax they have on mining. There are mining companies right now that do not pay taxes.
mred... I'm sorry,,,,but,,,, Taxing radio waves, ending 'Recreational' Drug abuse enforcement and taxing food is just stupid.
ecm,
Agreed. They should crack down on these egregious deductions that they rest of us, including Nevada's small businesses, are not allowed to take. Unfortunately, they still have the advantage of having written the state's Constitution and this has allowed our state to be raped and pillaged by mostly foreign corporations while we are left with nothing to show for it except mercury and cyanide poisons. When Sarah Palin was Governor of Alaska she saw through an increase in oil taxes up to 25% because in addition to drill baby drill, she said once you take the oil out you can never put it back. If the mining petition is successful, they will still pay less in taxes than the gaming industry, but at least we can start by asking them to shoulder some of the responsibility rather than burdening the rest of our citizens.
The state should look at raising the motor vechile yearly registration fee to $1,000. Make sure that the car rental agencies, all commerical and fleet cars/trucks, include post office,non-profits,local police and government owned, apartment dwellers, that's it, everybody pays. It may clean up some of the junkers. I would get rid a one of my 4, but I guess that is good. With the surplus, reduce property taxes.
Mr. Schwartz, why do you keep using the term deficit? (I understand it could just be your editors). As far as I'm aware, deficit and shortfall mean two different things.
A deficit occurs when the state spends more money than it takes in. Nevada is prohibited from running a deficit. This is a shortfall. A shortfall is when you predict you will not have enough money to spend for the next budget.
Of course, the way we calculate shortfalls shows how meaningless the term really is, sine Nevada officials predict spending way above what we know we'll actually take in.
Just ask Clinger or Governor Gibbons how they calculate that number.
If we have to raise any tax, the most equitable is sales tax that includes food and gasoline. Everyone (including illegals and professional welfare people) eats and all that drives (including visitors) will contribute to the repair of roads and any services related to their stay here. We should stop targeting specific (cash cows) companies or businesses because once they go broke, we will be back to the same problems. Those that don't want to contribute by paying sales tax, can move to other states.
I hate to say it: but what is next year going to be likely? Worse?
mawreek,
Conservative AZ has sales tax on food, like other states. Portugal, Holland even Mexico stopped prosecuting recreational drug crimes..saved money and overall crime went down.
Legal gambling and prostitution and you get your back up over pot? Go watch some "Dragnet Reruns"
Also, we need to lay off these over paid cops with their benefits and hire in gun-fighters like Wyatt Earp or Bat Masterson. Railroads have their own cops, cruise ships, private Universities - why can't Nevada neighborhoods and businesses have their own hired guns?
Lay off cops, judges, fireman, stop the war in Afghanistan that supports pedophiles and drug dealers.
mred, you need to stop abusing drugs while posting......
You want anarchy but love Obama..... see the disconnect?
You assume facts not in evidence. Don't even like Obama, medical bill is hand out to insurance companies, and he is an Iraq and Afghanistan war monger. I think for myself. Your views are parroting of talk radio nut job talking points.
You and Obama support the war in Afghanistan which supports drug producers and people who like to have sex with little boys. The US Troops support a government that is involved in organized pedophilia and heroin manufacture.
see the dittohead disconnect?
The Palinites and Paulians are at odds.
And stop texting in your patrol car, wait til you get to the donut shop for your free coffee and donut.
No more tax increases. Let's try this, fire these incompetent representatives this fall. Let's replace them with representatives that are going to cut spending. Throw the bums out! Tax and Spend Liberals are destrying our state.
Michael1971, I'm curious about your petition. It concerns me greatly your proposal says in the Description of Effect that it increases by 300% the tax on oil (to heat my house), gas (to drive my car) and geothermal energy (providing me clean renewable energy and jobs). I notice on your provided website you make no mention of this fact. However, you can read it right here at the unbiased source:
http://www.secretaryofstate.biz/Modules/...
How can this possibly be a tenable solution to a 2.5Billion dollar hole?
Just pay all the vendors and State workers with chickens.
mred, I have no clue what your talk radio heroes discuss nor do I care.
FYI, I listen to XM 54 or an audio book, I am currently listening to "The last season" a great book about a US Park Ranger.
I digress, reread your earlier posts concerning your worship of the UN.... interesting....
You do have a great idea about Wild West justice, too bad Vegas is already inundated with gunslingers.
anthonyezra,
It ain't about coming up with more money from joe taxpayer to fund out of control spending anymore, can't you righties comprehend that?
We need to fund the basic services.
We don't have the money.
We can't cut EVERYTHING, for God's sake.
We have to force those that fleece this state and use it's resources to PAY THEIR FREIGHT!
I cannot, will not EVER understand why Nevada allows MINING to strip the state of Gold & Silver and PAY NOTHING FOR IT.
I love the gaming industry.
They have a license to Steal & Plunder, literally to legally FLEECE people out of their dough, but Nevada is again afraid to ask the legal thieves to PAY A FAIR TAX.
In the entire world, to my knowledge, Nevada collects THE LOWEST PERCENT of gaming revenues in taxes.
The only thing I can figure is that they still have the mentality that the MOB is involved, and
we do not ASK the MOB for A DIME, lest we invite "serious consequences" to visit our doorsteps.
Those of you that think allowing Gaming & Mining to skate off scott-free without chipping in a little sumpin' sumpin' is "A-OK!", while the state sinks like the titanic confound me greatly.
Drug enforcement costs millions, and up til 1911 there were really no drug laws in the United States (other than the failed attempts to ban opium in the 1880's in a few localities.)
Therefore, by your thinking,the founding fathers, Abraham Lincoln ET AL were all anarchists. In fact after the Civil War, many soldiers became addicted to Opium, they called its "Soldier's Disease," and yet they didn't even think of banning opium.
Your hero George Bush, went to war against Iraq because "they didn't comply with UN resolutions."
I don't think the UN is a topic of the Sun normally, but how come your heroes: Nixon, Reagon, Bushs, didn't pull out of the UN? The UN says that your troops are facilitating drugs and pedophilia in Afghanistan by the way.
As far as "Frontier Justice" I trust the average Joe with a gun more than someone like the Nevada Highway Patrol Man hold up in his Anthem Home with a Gun yesterday or the 118 mph NHP "going home to take an internet test" guy... Or the Metro doing 100s of miles per hour in 45mph neighborhoods, or the Sheriff who said 4 times to the media that: "the lights and siren were on." .....or the Metro guy that held a gun to the Doctors head wanting him to "write another prescription" ...and so on...and on and on ..
A gunslinger would be better by far...
savelvpropertytax
"The state should look at raising the motor vechile yearly registration fee to $1,000."
Why stop there, lets ask them to charge $10,000 each! You sir, are a dope, people are already paying 10 times over the amount of normal registration fees!!! BTW it's vehicle not vechile.
I am saying again, I'm tired of subsidizing people that don't pay any income tax at all and it's time to stop targeting already overtaxed group of people and businesses. Most of the leeches that are totally dependent on government subsidy don't even pay income tax so it's time that we get everyone contribute through sales tax. It won't hurt as much if all of us help out instead of just a group of hardworking people shouldering most of these taxes.
gmag, just what do you define as "essential services"?
It seems MrTeatime2 is disagreeable this evening.
boftx...
I'm thinking you are setting a "trap" with your question.
My answer & yours would be similar yet different.
Essentially, we're talking about the usual functions of government; roads, schools, police, fire, and yes, even certain social services are essential for a properly functioning city the size of Las Vegas, Nevada. I'm sure therein lies where you & I would start a conversation about what is and is not "essential."
I'm not sure what good cussing out the Sun is gonna do a guy.
Seems silly to rile yourself up over a rag.
Yes, gmag, it is most likely in the realm of social services where you and I would have a discussion of what is "essential".
Sell off the state parks and build condos. Give all inmates guns and lock the doors. Privatize all schools, colleges and universities. Send all senior citizens that require gov't services to Florida. Discontinue speed limits. Sell all artifacts in museums on ebay. Can everyone at the AG's office (who needs lawyers anyway), decriminalize poaching, turn the Gov's mansion into a B&B, let the range burn, and let the casinos regulate themselves. Home means Nevada.........
Tax increase ? on whom ?....those that are left and haven't run out of the state? GIVE ME A BREAK !! Hell give the police and fire department a raise....after all they're only sucking the life out of the state with their ENORMOUS salaries. They only need to look at those two areas for ALL their money problems.Problem solved............
NOPE! But I was... :)