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November 20, 2014

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Only Nevada to blame for puny share of U.S. money

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Alex Richards

Sun coverage

Nevada is dead last in per-capita federal funding for state programs such as health, education and transportation, according to a new report from the Brookings Institution.

Nevada received $742 per person during fiscal year 2008 from the federal government for these programs, compared with $1,469 for the rest of the nation.

The study includes money for programs based on fixed formulas — including per-capita income and census estimates — that are mostly immune from congressional wrangling. As such, the study isn’t an important measure of the influence of Nevada’s congressional delegation, though it does raise questions about the state’s governance.

In short, Nevada leaves millions, if not billions, of dollars on the table because state agencies are not aggressive in pursuing federal money and because state legislators have created state programs that cut off opportunities for federal matching funding.

The primary reason Nevada receives so little money from the feds is because most federal money comes in the form of matching funding for state programs such as Medicaid, the health insurance program for the poor, blind and disabled.

Nevada received $315 per capita for health programs, or 42.5 percent of the total money the state received, versus $892 per capita for other states, nearly 61 percent of their totals.

Nevada has long had one of the nation’s stingiest Medicaid programs, with restrictive eligibility requirements.

In part because of the tougher eligibility standards, about 6.7 percent of the population was enrolled in Medicaid last year. That enrollment was second lowest in the nation, according to the most recently available data.

Edwin Park, senior fellow at the liberal-leaning Center on Budget and Policy Priorities, told the Sun last year that Nevada has developed one of the widest gaps between what the federal government could give for the State Children’s Health Insurance Program, or SCHIP, and what the state receives.

“It’s an unusual situation,” he said.

For example, in the fiscal year that ended Sept. 30, 2008, Washington allocated $51 million to Nevada Check Up, its version of SCHIP. But the program got only $28.8 million because the state’s contribution — $14.2 million — fell $11 million short. If the state had allocated more money, Nevada Check Up would have had a total of $75 million, instead of $43 million.

But it’s not just health programs.

According to testimony last year to the Assembly Health and Human Services Committee, just 30 neighborhoods in Washoe County were being served by a nutrition assistance program, or about 1 percent of the children eligible. That left $57 million in federal funding on the table.

“To be blunt about it,” said Nicholas Johnson, director of state fiscal policy for the Center on Budget and Policy Priorities, “if Nevada wanted to capture more federal dollars, they should be cutting less and doing more on the revenue side and supporting those programs with a federal match.”

For conservatives, however, our small social and health programs, which lead to fewer federal dollars coming our way, are smart policy because they keep taxes low.

It’s not just our social and health programs that prevent us from collecting more federal dollars, however.

Nevada’s congressional delegation claims that federal programs that dole out money based on census estimates haven’t properly captured our growth.

Also, aid from the federal government often depends on a state’s relative poverty. Nevada, until recently, had incomes that were well above average. The depressed incomes of Nevadans because of the recession may not yet be showing up in the formulas that determine our federal share.

Finally, as UNR economist Elliott Parker pointed out, the Nevada Spending and Government Efficiency Commission recently recommended that the state hire more grant writers as there is currently a “significant number of opportunities for federal funding,” perhaps $93 million per year, “not pursued because of inadequate availability of grant writers.” Doing so, however, would cost the state upfront.

Although the funding referenced in the Brookings report is usually based on fixed formulas that are beyond the influence of Nevada’s congressional delegation, opponents of Sen. Harry Reid and his defenders clearly see the political potential of Nevada’s last-in-the-nation ranking.

Brian Walsh, spokesman for the National Republican Senatorial Committee, said, “Whether it’s unemployment or foreclosures or money from the stimulus, it’s difficult to make the argument that Harry Reid delivers for Nevada.”

He added: “Particularly in his position as Democratic majority leader.”

Reid’s argument for re-election revolves almost entirely around his ability to use his influence in Washington for Nevada’s benefit.

His defenders note that Reid successfully secured extra money for Medicaid during the stimulus debate last year for states like Nevada with high unemployment. They also note that Brookings’ calculations don’t include military spending or the special projects of members of Congress called “earmarks.”

Reid recently secured $3.2 billion for long sought-after transmission lines to expand Nevada’s renewable energy capacity.

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