Sandoval and Horsford Clash on Use of Education Funds

(Samantha Stone/The Reasonable Reporter) – Senate Democrats accused Governor Brian Sandoval on Thursday of plugging an “arbitrary and capricious” number into his budget. They further claimed the governor broke faith with voters when he proposed that school district bond reserve accounts be used for operational expenses, rather than building and improvements.

“I think voter intent, and voter understanding, and voter approval is critical in any decision we make,” Senate Majority Leader Steven Horsford said, wielding a 1998 campaign pamphlet advocating passage of Question 2.

The promise to Clark County voters was that they were authorizing school construction bonds only for building, equipment or land.  The brochure spells out prohibited uses as well: “By law, the funds may cannot be used to pay administrators, teachers, or other non-construction related costs.”

“I think the voters of Clark County should be concerned that they approved one thing and they understood it to mean one thing, and that the intent may be changed based on the goveror’s proposal,” Horsford said.

Washoe County voters agreed to similar limitations in a 2002 ballot question authorizing general obligation bonds. The use of proceeds from the bonds issued is limited to  the acquisition, construction, improvement and equipping of school facilities, said Washoe District’s Chief Capital Projects & Facilities Management Officer Mark Stanton.

Sandoval Chief of Staff Heidi Gansert rejected any suggestion that the governor’s budget flouts the will of the voters, citing various sources of money besides bond proceeds that are combined, and placed into the reserve funds. 

Gansert also cited legislative precedent for comparable action. In the 2009 regular session and in the 2010 special session, the legislature swept the Clark County capital fund, which is intended for capital expenditures, and is a feeder fund for the account in question, Gansert said. In those cases money was pulled into the state’s general fund.

Sandoval’s budget would reduce by half the amount in the school district reserve accounts. Those accounts hold excess cash, according to various proposals that would see the money used now, rather than sit fallow. The governor would redirect the money to offset a state obligation to the school districts, allowing each county to use its own money for purposes other than construction.

“Our language is permissive,” Gansert said of the governor’s plan, reiterating in a phone interview that the state is not seizing the money.

Horsford nonetheless calls it a “raid” that will hamper counties from performing basic maintenance, as well as future construction.

Clark County is also the source of the disputed budget figure. Horsford said the governor made a flawed assumption in order to present a balanced budget.

“It’s not balanced,” Steven Horford said, after a day-long round of testimony from school districts throughout the state.  “It could have a hole as high as $420 million.”

Horsford says the governor arbitrarily plugged in $300 million from the Clark school district’s reserve fund without any analysis to determine whether the money was actually available. He criticized what he called arbitrary and capricious methods, as well as a slow reaction on the part of the governor’s office when Clark clarified its status.

Gansert expects to submit numerous revisions to the budget as new information becomes available, she said in a written statement. 

“In a committee hearing today, I committed to reconciling our numbers with the numbers the school districts presented and we are looking forward to working with them and to continued dialogue with the Legislature on budget matters.”