(Sean Whaley/Nevada News Bureau) – The Nevada Economic Forum will meet Jan. 22 to provide its analysis of state general fund revenue collections for the remainder of the two-year budget to Gov. Jim Gibbons and the Legislature.
Gibbons asked the panel, made up of five private citizens with fiscal expertise charged with projecting tax revenues during legislative sessions, to meet initially by Jan. 19 to update its state tax revenue projections. That deadline was extended to Jan. 22. The panel will make projections for the major revenue sources, from sales and gaming to the insurance premium tax.
Gibbons has said he wants input from the panel before deciding when and if to call a special session to deal with a state general fund budget shortfall that is currently $67 million.
Tomorrow is the deadline for state agency chiefs to submit budget cutting scenarios reflecting what reductions of 6 percent, 8 percent and 10 percent would mean to the programs and services they provide.
Budget reduction plans reflecting cuts of 1.4 percent and 3 percent were already provided to Gibbons last month. The newer, higher level of cuts reflect concerns that the state’s general fund revenue collections will not recover as expected when the Legislature approved a balanced budget in June.
In addition to the lower than projected tax revenue collections, the state Medicaid budget is expected to see a deficit of $55 million by the end of the two-year budget on June 30, 2011, due to unexpected caseload growth.
Gibbons said the purpose of providing him with the different budget cutting scenarios is to begin to develop a proposed list of cuts that would do the least harm to essential programs and services.
“What I’m asking them to do is prioritize everything so we can look at the least important, the least impactful thing that each agency does, and we’ll start looking at the bottom and working our way up,” he said.
Any cuts required as part of a plan to balance the state budget could be implemented as soon as March 1 for this fiscal year, and for the entirety of the 2010-2011 fiscal year that begins July 1.
Gibbons has asked state employees for their advice on budget cuts, and he has had one meeting with lawmakers to seek their input as well. More meetings with lawmakers are expected before a decision to call a special session is made.
Gibbons has said everything is on the table for discussion, including the potential of state employee layoffs.
Only the governor can call the Legislature into special session.
Whether the budget shortfall will require a special session has not been determined. But lawmakers are expected to be called to the capital by June to take action on a separate issue, a provision in state law that is keeping the state from applying for federal “Race to the Top” funds to improve schools.
Gibbons said he will seek a special session to repeal the law, which prohibits the use of student achievement data from being used to evaluate teachers.
The law must be changed or repealed by the end of May so the state can apply for as much as $175 million in funding.
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