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July 25, 2016

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SIX QUESTIONS:

Regent says it’s time that K-12 shares in budget sacrifice

Ron Knecht

Ron Knecht

Last August, when he excoriated the university system’s Board of Regents for refusing to cut spending by 10 percent, as then-Gov. Jim Gibbons had asked, Regent Ron Knecht was blunt.

The regents were disconnected from reality, he said. Knecht was the only regent to vote for budget cuts in higher education.

That was then and this is now.

Knecht has changed his position, saying now that the higher education cuts proposed by Gov. Brian Sandoval are too much.

His solution is equally blunt: Take the money from K-12 and give it to higher education.

The Nevada System of Higher Education has nearly 100,000 students spread over eight institutions, including UNLV, UNR, and the College of Southern Nevada.

In current spending, higher education is the third-largest slice of the state pie at about 15 cents of every dollar. K-12 is almost 40 cents, health and human services more than 29 cents.

In a 13-member board, Knecht, from Carson City, stands out.

A former Democrat and fan of Saul Alinsky, the radical community organizer, he is now a libertarian Republican.

As an economist and former state assemblyman, he brings an intense regard for data to his role as the regents’ finance chairman.

Knecht, 61, spoke just before the start of the regents’ budget-review meeting last week. The board voted unanimously to oppose the cuts proposed by Sandoval.

Why were you the only regent to vote for Gibbons’ 10 percent budget cuts in August?

The we-won’t-do-it response (to Gov. Gibbons) seemed to me a triumph of symbolism over substance. Nobody was deluded that the regents were going to get what they were asking for.

Is the Sandoval budget sound?

He put together something that is credible, given the revenue constraint. But it could be improved. K-12 and health and human services have made out like bandits. The average annual growth rate compounded for K-12 is about 8.58 percent over the last 10 years. Health and human services is 8.12 percent. But Nevada’s economy grew by only 5.13 percent.

How could the Sandoval budget be improved?

Maybe it’s time for health and human services and especially K-12 to take their proportionate hits, which they’ve never taken. For the first time, higher ed had spending cuts from fiscal year 2009 to fiscal year 2010. K-12 continued to grow, even as the economy was going down.

Is the Sandoval budget fair to Nevada?

It’s a fair budget for Nevada because in this decade we have had two big tax increases, approximately $1 billion each, and public-sector spending has grown 31 percent faster than one of the fastest-growing economies in the country. It’s fair in the sense that, wait a minute, we can’t take ever more money from the businesses and families of Nevada. We’ve got to stop somewhere.

Is the budget fair to higher education?

It would be a whole lot more fair if K-12 and HHS were finally required to carry the burden. That would free up revenues for higher ed. If 10 is the most fair, this (Sandoval proposal) is about a 4 and I’d like to get to about an 8. There is a real fairness problem that we have to deal with.

How should higher education cope with the cuts?

Believe me, if I had the exact answer, I would tell you. It’s a process now. Now that we’ve experienced year-over-year spending cuts and now looking at an additional $162 million, we have to do something. Before, there was a lot of hype and overstatement. Before I could see how we could get through this. Now, I’m saying: How are we going to get through this?

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