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October 25, 2014

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Sandoval budget assumes 10 percent cut to state, higher ed and furloughs

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Nevada general fund revenue and appropriations.

Gov.-elect Brian Sandoval is building a budget that assumes a 10 percent cut to state agencies, $175 million reduced from higher education, the extension of furloughs for state workers and rosier-than-expected projections for state spending on unemployment insurance and Medicaid.

That still leaves the state about $1.2 billion short of having a balanced budget, after Wednesday’s projections of the Economic Forum. Sandoval’s transition team, working with state budget director Andrew Clinger, has asked agencies to come up with additional cuts as high as a total of 30 percent.

Earlier this year, the budget office under Gov. Jim Gibbons ordered departments to prepare budget scenarios with a 10 percent cut. Those plans, which would save the state about $820 million over two years, were released in October.

To save an additional $1.2 billion, there would need to be another 15 percent of state spending, though budget director Andrew Clinger said another round of cuts would not be across the board. (Senior state personnel, speaking on the condition of anonymity because they’ve been asked to keep the numbers confidential, have said they’ve been instructed to prepare for additional cuts by the budget office, which is now being run by the Sandoval transition team.)

Heidi Gansert, Sandoval’s future chief of staff, said some of the 10 percent cuts that have been proposed will not happen, including some proposed cuts that have garnered protests from social service advocates.

In particular, she said that a proposed elimination of personal care attendants for the elderly and disabled would be restored.

The Las Vegas Sun highlighted those cuts in October.

Eliminating that program would have saved the state $55 million. And every cut deemed too severe will have to be replaced by a cut somewhere else.

“We’re revising the list to make sure that we’re protecting the most vulnerable people,” Gansert said, declining to be specific.

Sandoval has until Jan. 24 to prepare his budget and state of the state address. He has consistently promised not to raise taxes, despite skepticism from legislative leaders in both parties that he could reasonably balance the budget without additional revenue.

Earlier budget office estimates had put the deficit number closer to $3 billion, which conservatives attacked as being inflated to scare the public into agreeing to new taxes.

Sen. Sheila Leslie, D-Reno, said Sandoval’s administration could not just make assumptions about certain things being passed or cut. She criticized the 10 percent number.

“This is clearly the spin coming from the governor’s office to minimize the budget hole, so he can maintain his no new tax pledge and convince the public that the problem isn’t as big,” Leslie said.

Gansert said simply the $8.3 billion number is wrong.

“The numbers are the numbers,” she said.

Leslie acknowledged that employee furloughs or something similar, saving the state $480 million over two years, would likely be extended though.

Higher education officials, who have so far refused to detail how they would cut their budgets, were not immediately available for comment on Thursday.

Sandoval senior adviser Dale Erquiaga said the administration was looking at all options, but was favoring structural changes.

“We have to put behind us the one-time solutions,” he said.

Sandoval’s senior staff have spent hours meeting with department heads over the past few weeks to find places to cut.

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