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June 30, 2015

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Low taxes or better education system? Study of Nevada’s woes doesn’t take a stand

A new report aimed at guiding Nevada out of its economic abyss delivers the bad news first. And it’s nothing state policymakers haven’t heard before:

Nevada suffers from an underperforming education system and an underperforming health care system. Our energy costs are too high and we rely too heavily on consumption-based industries that tank when people stop spending money during slow economic times.

We lack investment in innovation and spent a decade, during which our economy boomed, neglecting our haphazard economic development efforts.

In the 178-page report presented to the Economic Development Board today, researchers with the Brookings Institution and SRI International offer the beginnings of a road map for changing all that.

“A fairly trenchant to-do list emerges from this analysis,” said Brookings fellow Mark Muro, acknowledging the severity of Nevada’s economic challenges. “This is the worst, most prolonged downturn the state has seen in decades and that creates a sense of urgency. I think the chances are quite good that the state is going to make some helpful and overdue changes.”

The study is one of the first steps in the creation of a new economic development system set in motion by Assembly Bill 449, which passed last session with the backing of Gov. Brian Sandoval and legislative leaders from both parties.

It will form the basis of a plan by Sandoval’s new economic development czar Steve Hill and a board of elected officials and industry representatives created by the new legislation.

Much in the Brookings-SRI study is brass tacks:

• Target seven industries with the best potential for building on the state’s existing strengths — a renewed focus on gaming and tourism, for example — a s well as diversifying beyond the heavy reliance on consumer spending — better developing the private aerospace and defense industry.

• A strategy for best deploying the $10 million Catalyst Fund — to help entice businesses to relocate or expand in Nevada — so that the board doesn’t “blow it.”

• Dividing the state into three regions — northern, southern and rural — and playing to industry strengths in those areas.

• Build a “statewide economic development operating system” that replaces the scattershot approach policymakers have taken in the past.

But while the report puts data behind many of the assumptions legislators made about strong economic development efforts — regionalizing the approach, identifying strategic industries and sectors for growth, better cultivating innovation through research and development — the study does little to settle the more fundamental tug-of-war over how to approach economic development that has sharply divided state leaders in the past year.

Senate Majority Leader Steven Horsford, D-North Las Vegas, has argued that touting Nevada’s low taxes is not enough of a selling point when the state’s education system is broken, and could actually exacerbate the problem by drawing businesses unwilling to invest in strengthening schools and universities.

Sandoval, on the other hand, believes that higher taxes would stymie economic growth and has promised to eliminate regulations that would interfere with business.

The report does little to choose between the two schools of thought. Instead, it tries to play both sides of the fence, recommending that the state continue to stress its low-tax environment while also strategically increasing investment in education.

“This assessment confirms that Nevada’s core strength for economic development has been and will remain its overall business-friendly environment, including low taxes, relatively low costs, light regulation, and ease of business start-up,” the report says.

That’s a finding that appealed to Sandoval, who believes Nevada’s low-tax environment continues to be the state’s best selling point. But he argued it’s not an either-or proposition when it comes to investing in education.

“Its emphasis has to be more collaboration and that’s exactly what we are doing,” Sandoval said, listing the strides his administration has taken to bring higher education officials into economic development activities as well as key reforms he’s initiated in the kindergarten through 12th grade system.

But the study doesn’t pull punches in describing the paucity of Nevada’s skilled workforce and the inability of an underfunded education system to address that problem.

“The weaknesses of Nevada’s workforce are closely associated with Nevada’s relatively low — and falling (based on the last budget) — levels of spending on higher education,” the report says. “It is clear that significantly ramped up investments in education will be needed in order to bring Nevada’s workforce skills to the level required by its most strategic future industries and companies.”

And that raises the question of whether Hill and the board can succeed without Sandoval and the Legislature reversing course on their cuts to education.

“The short story is we think the state has got to make some changes,” Muro said. “The state has begun to make a few adjustments, but this is clearly one of the important areas for further action.”

The report calls for better investments in math and science education in kindergarten through 12th grade, better aligning community college programs with the workforce needs of private industry and better investing in universities to attract key researchers who can fuel innovation in the target industries.

“It’s not about broad-based investment across the whole higher education system,” Muro said. “It’s about picking your places and bringing in particular sorts of researchers.”

Sandoval refused to acknowledge or dispute the study’s assertion that “significantly ramped up investments” are necessary in education.

“Funding is always going to be the issue,” Sandoval said. “One of the challenges was during the budget process that money wasn’t there this time. We’ll do the best we can for the university system moving forward, working very closely with the chancellor and the board of regents.”

Assembly Speaker John Oceguera, D-Las Vegas, said he was pleased the study acknowledged the state has work to do on the education front.

“Yes, we do have low taxes. And yes, we do have a business friendly climate. But (the report) then also goes on to say our workforce skill level is low and K-12 education is underperforming,” Oceguera said. “It’s at least recognizing that there are weaknesses there and we need to work on it.”

It’s not a problem that Sandoval is ignoring, Hill said.

“What the governor has said is as we recover getting more money to education is a great thing,” Hill said.

But for now, the regulatory environment and keeping taxes low continue to frame Sandoval’s approach to bringing businesses to the state.

“Yes, we have low and stable taxes and we have a lower regulatory environment that the governor is trying to make even better,” his chief of staff Heidi Gansert said. “We are also a place where you can get things done. We are small and you have access to people who can make the decisions.”

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  1. Something to ponder.....

    Do we really have an under performing education system or do we have under performing families and students?

    50% don't graduate yet 50% do.

    Is it really the schools or is it the lack of personal responsibility and true ambition by the families and students in this valley?

    Instead of looking at what is wrong all the time maybe we should be looking at the 50% that do well and get others to follow in their footsteps.

    The simple things. Showing up everyday and on time for class, paying attention, doing your studies and not disrupting class.

    Funny part is that non of that would take any more money.

    I know these ideas take all the fun away from getting to blame others for the problems but there just might be something to it.

    Just an idea. ;-)

  2. Mr. Reid,

    Can you provide a credible source for your statement of "Nevada high schools have the highest rate of teen prostitution in the country?"

  3. Teachers and Student performance are linked. It's all about quality Teachers graduating from the top third of their High School Class. As in the top systems those individuals get their education paid for by the Government/Taxpayers get a top salary comparable to what they could make as a professional any industry they qualify for, and they must meet national testing. In return they may have 40 or more students per class, the performance of the students is continually monitored and tested. Students that don't meet standards cannot even enter technical schools, so there is pressure on parents and students to perform. This system is in Singapore. Look at HDNET Dan Rather Reports for more information.

  4. Progressive democrats and some progressive republicans have to shoulder the majority of the blame for education in this state. The rest falls onto the unions and the school districts. They need to be held accountable, it was their job ( as they claimed by state law) to educate the kids. To say the schools have failed miserably is putting too nice a face on to the problem. Drastic measures are required but will not happen because the kids are NOT important enough. Democrat/progressives like dependent welfare people. It makes them feel like thy accomplished something, keeping people down.

  5. Let's start with VegasLee's comment, of which I also echo his thoughts. PARENTS are a child's first teacher, and they are also RESPONSIBLE for that child until age 18, high school graduation, or the child's emancipation. When you figure that the current stats reflect Nevada having roughly 50% or more population of ESL/ELL students, predominately "Hispanic/Latino/Mexican" origin, you gain a picture of WHY educators and education has suffered decline. The fact is, the majority of ESL/ELL students are coming from parents/families that DO NOT speak the ENGLISH language, nor read, write, or do math in English!!! And guess what, PreK through Grade 12 in American public schools (which are required to take anyone who walks through their doors) teaches in ENGLISH, has all textbooks and resources in ENGLISH.

    Hence, the poor performance, as a whole, by schools. Educators are helpless to do anything about this, while LAWMAKERS, who could make a difference, have spent their legislative time posturing and bickering, and turning out toothless laws that get ignored. That is a waste of taxpayer money and a shame!

    Most recent examples are the 76th Nevada State Legislative Session, passing AB224 regarding the yearly PARENT/TEACHER/STUDENT INVOLVEMENT COMPACT, which is printed and administered at taxpayer expense. There is NO ENFORCEMENT, NO CONSEQUENCES involved with this law! And the Anti-Bullying Law/Policy,SB275,they also crafted and passed, has basically verbally warnings and threats to take action as consequences, as many teachers in the trenches are now finding out. Passing laws without consequences is a serious failure with our Nevada State LAWMAKERS, and these career politicians should NOT be re-elected!!!!

    Education in the United States of America is under the influence of corporate billionaires. No Child Left Behind and Race to the Top are creations of these corporate billionaires. Feel empowered yet? Now, you should also know this: that the very wealthy, powerful, elite billionaires of the USA, are are unfairly influencing public education, to wit, the United States Department of Education, who sets public policy for education. It's true! I really had NO idea of this until reading this Winter 2011 Dissent article, "Got Dough? How Billionaires Rule Our Schools," by Joanne Barkan.

    And I quote Alexis de Tocqueville saying, "in every democracy, the people get the government they deserve".

  6. It is clear, that PARENTS are responsible for the care, welfare, security,and safety of their children. How many parents are actively engaged with their child?

    Parents should be having conversations with their children about their future and the coursework at school they are engaged in. But nowadays, it seems,both parties are too busy attached to their cell phones texting and communicating other nonessential things, than to be talking with one another.

    One shoe does not fit all. Nor does one path or style in education. It is a profession dealing with professionals servicing individuals and individual needs. Career education is promoted as early as elementary school. The fact is that most parents do not concern themselves with their child's career interests until the later high school years, then it is too little, too late. Careers take detailed planning that is carefully followed over time. It takes caring adults in children's lives to foster a love for learning towards a path of future success. We cannot rely on government to do the work of PARENTS.

    Blessings and Peace,

  7. I would say most of these kids that dropout and under perform more then likely come from a single parent plus dysfunctional family environment. Now in normal circumstances the parent(s) are responsible to get these kids prepared and motivated in class.
    Here's the problems with not making this a societal and state priority.

    1. It is immoral not to help these kids.
    2. We the taxpayers will pay more into these kids in the long Run with jails,public assistance, E.T.C.
    3. You never know in this group of kids are we allowing the next Albert Einstein to fall through the cracks into oblivion instead of being the super positive impact for our country.