State agencies put forward mostly flat budget requests

By David McGrath Schwartz

Published Monday, Oct. 15, 2012 | 10:33 a.m.

Updated Monday, Oct. 15, 2012 | 2:22 p.m.

State spending would bump up slightly to deal with more people seeking government assistance, and state employees would still see their pay cuts and furloughs under agency budgets for the next biennium released this morning.

Total state general fund spending would increase 4.5 percent on operating costs next biennium compared with the current budget.

Agencies asked for $6.4 billion, with health and human services projecting ballooning caseload growth and additional costs because of the Affordable Care Act. Current spending is about $6.2 billion for the two years that began July 1, 2011.

“Agencies did what we intended them to do, and that’s put forth flat budgets,” said Jeff Mohlenkamp, the state’s budget director.

Salary cuts and furloughs for nearly 25,000 state and higher education employees, would stay in place under the agencies' budget.

Gov. Brian Sandoval's administration had instructed agencies to prepare "flat budgets" - asking for spending at 2013 levels, plus the added costs to caseloads as more people sought state services and federal and state mandates. He has indicated he was “hopeful” that some of those pay and salary reductions would be undone after the state makes formal projections about how much money it has to spend in December.

The largest increases came in health and human services, which is projecting significant cost increases as more Nevadans get health insurance through Medicaid.

In the total budget, the agency is requesting an additional $800 million, of which about $100 million is in federal funds, according to Mike Willden, director of Nevada Department of Health and Human Services.

About $88 million in general fund costs is due to the Affordable Care Act - “Obamacare.” The agency is requesting that money to administer the programs and deal with those who are currently eligible for state health insurance but have not enrolled seek services because of the new law.

The state expects an additional 70,000 enrollees to join Medicaid because of the federal mandate that individuals hold health care. They also plan more public outreach campaigns.

The state also has the option to expand Medicaid to cover another 71,000 people on top of those already eligible.

The agency budget released Monday does not include that expansion, but Sandoval has said he still is weighing the decision. He said he has asked the agency to prepare two separate budgets, but the state is not releasing the budgeted costs for expanding Medicaid under the Affordable Care Act.

The state is recieving more money from the federal government to pay for its health and human services costs, largely because its per capita income - calculated on a three year average - has plummeted in the Great Recession.

That has freed up additional money for other programs. The agency’s budget has additional money set aside to provide early intervention services for 1,600 newborns to three-year-olds over the next two years, primarily by contracting with nonprofit community providers.

Additionally, waiting lists for the mentally retarded and those with other developmental disabilities will be reduced, with another $10 million appropriated to the Desert Regional Center in Clark County.

Sandoval said earlier this year he would support retaining tax increases first passed in 2009 that will expire in 2013 without Legislative approval. He has promised not to cut K-12 and higher education budgets further.

The agency budgets, which were released Monday according to state law, will be adjusted by the Sandoval administration. He will submit his final budget to the Legislature in January. The Legislature will then have to pass a budget during the 2013 Legislature.

The state prepares and passes budgets two years at a time.

Total state spending, which includes federal money, under the agency budgets released Monday would be $9.409 billion next fiscal year and $9.541 billion the following fiscal year.