As budget clock ticks, easy part still isn’t done

By David McGrath Schwartz

Tuesday, May 12, 2009 | 2 a.m.

This was supposed to be the easy part: figuring out how much the state would spend over the next two years.

Legislators were unable Monday to reach an agreement on funding higher education, even as a deadline fast approached that could see the entire process wrenched from their control.

They still have the harder task in front of them: developing a plan to raise hundreds of millions of dollars in taxes to meet the spending levels they have and are approving.

Speaker Barbara Buckley, D-Las Vegas, acknowledged Monday that negotiations over which taxes to raise “will be even harder” than agreeing on how much to spend.

Only nine days remain until legislators’ self-imposed deadline to pass a budget.

In the past, governors would call special sessions to allow more time to finalize budgets and other legislation after the constitutionally mandated 120-day legislative session ended. This year is different because Gov. Jim Gibbons has no intention of giving the Legislature time beyond the June 1 deadline to do anything other than pass his budget.

He has said he will veto the Legislature’s budget if it includes any tax increases, which the lawmakers’ budget will.

To pass a budget and allow time to override a Gibbons veto, the Legislature must pass a spending and tax plan by May 21, legislative leaders say.

Earlier in the day, Buckley said that if lawmakers don’t soon pass a budget, they will be forced to pass Gibbons’ budget.

Assemblywoman Sheila Leslie, D-Reno, said lawmakers must reach a deal on the spending portion by today, “otherwise it’s 50-50 if we can get the budget done on time,” she said.

Democrats chose early on to set up the budget process like this: First come up with a spending plan. Then talk about which taxes to raise.

But it has taken months of hearings and hours of closed-door negotiations to come close to a consensus on spending. A deal remained elusive late Monday. Standing in the way is $14 million in spending out of a budget of more than $6 billion.

All that is left to decide on the spending side is higher education and a small K-12 fund. Leslie said Assembly Democrats have offered to cut that K-12 fund — used for grants to public schools — to reduce the cuts to higher education.

Gov. Jim Gibbons had proposed a 36 percent cut to higher education from spending levels approved by the 2007 Legislature.

Assembly Democrats and Republicans have both signed off on a 13 percent cut to higher education, according to Leslie. Senate Majority Leader Steven Horsford wants to go to 12 percent, she said.

Horsford wouldn’t confirm any number but said he has drawn a line in the sand.

“It’s such a small difference it’s pretty silly ... At some point you have to draw the line.”

Senate Republicans — two of which are needed to pass a tax increase — have drawn their own line. Republican sources say they are resisting adding money to higher education to avoid increasing the size of a tax increase. The highest tax increase they could support is about $800 million, the sources said.

Senate Minority Leader Bill Raggio, R-Reno, wouldn’t confirm any numbers but said, “There are limits to what caucuses are going to support. I’m not just going to throw that out.”

The failure to reach an agreement has added tension to the atmosphere.

Earlier in the day, Horsford emerged from the closed meeting with a scowl on his face.

“There are at least four or five blowups a session,” said one veteran lobbyist. “I think they’re only on two.”