Most state agencies deliver slimmed-down budgets

By Cy Ryan

Thursday, Sept. 2, 2010 | 2:05 a.m.

CARSON CITY — Michael Willden succinctly summed up the proposed budget for his state Department of Health and Welfare.

“It’s ugly,” he said.

Wednesday was the deadline for agencies to submit their proposed spending program for the next two fiscal years to the state Budget Office.

And they were under order from Budget Director Andrew Clinger to reduce spending by 10 percent from the current biennium in recognition of an expected $3 billion deficit in the next two fiscal years in tax collections.

Cutting his budget, says Willden, the director of the department, will mean layoffs, downsizing and the elimination of some programs.

At the other end, Howard Skolnik, who is director of the state Department of Corrections, said that “after extensive discussions with the budget office,” he will not have to lower prison budgets by 10 percent.

Skolnik said no programs are being eliminated, but he declined to say if any correctional officers would be laid off. “The department feels it will still be operating at a safe level,” he said.

Keith Rheault, state superintendent of public instruction, said the 10 percent reduction is being applied to the average $5,395 per student state support approved by the 2009 Legislature.

How much that will mean won’t be known until all the school enrollment figures are compiled and submitted to the state.

But Rheault said he has been told by school superintendents in some rural counties that a 10 percent cut would cripple their districts. The superintendents complain they have been hit with prior reductions and if there is an additional reduction, “the state can take over because we will be bankrupt,” Rheault said, quoting local officials.

He declined to say what districts feel they won’t be able to make it if the cuts go into effect.

Education, health and welfare, and the prisons make up the lion’s share of the state budget.

The independently elected regents of the Nevada System of Higher Education have already ignored the directions of the Gibbons administration to cut spending. Instead, the regents approved a $1.19 billion budget, up 4.5 percent.

Willden said he isn’t happy about chopping spending at a time when the number of people applying for aid is increasing. Federal support of the expensive Medicaid program also will be diminishing.

The department’s budget is about $1 billion a year in general state revenues. But the number of people seeking welfare, food stamps and health care from Medicaid is rising.

The law, as it stands now, calls for federal support of the Medicaid program to be reduced in steps from 64 percent to 52 percent by June 30. “This is a huge impact,” Willden said.

The 2009 Legislature approved spending $935.2 million more than the present biennium in the Medicaid program.

Several hours before submitting his budget, Willden said he was still short about $300,000 in a $2 billion biennial budget of reaching the 10 percent cut. But he said his staff is still analyzing what other areas can be reduced.

State directors have been reluctant to detail specific reductions until cleared by the budget office.

Skolnik said the prisons have about 2,600 employees and he is hoping to fill vacant positions. So it doesn’t appear he will have to cut staff. The 2009 Legislature approved a two-year spending program of $446.5 million for the corrections department.

In his budget, Skolnik is recommending closing the ancient Nevada State Prison in Carson City. Gov. Jim Gibbons favors the closure, but the 2009 Legislature rejected the idea. The state Prison Board also turned down the proposal.

Rheault said the state Department of Education will be able to absorb the 10 percent cut without any layoffs. He said some federal funds and fees have been moved around to prevent anybody from losing their job.