Members of the Senate Finance Committee voted Saturday to advance a bill that would replace Nevada’s half century-old education funding formula.
The vote on an amended version of SB543 comes five days after a marathon joint budget committee hearing on the bill, which is among the most consequential measures before the Legislature this session even though the bill itself does not add or subtract money from schools. The measure had substantial testimony this week both in support and opposition, with much of it boiling down to there not being enough funds to fulfill the vision of the formula and soften the blow of any money-shifting between districts.
“I think at the end of the day, we do have to have faith that we’re doing the right thing, that this is good for kids,” said Democratic Sen. Mo Denis, one of the chief architects of the bill. He noted that the bill should be a bit easier to implement because lawmakers voted earlier in the day to add $62 million to basic education funding.
Committee chairwoman Joyce Woodhouse noted that a commission would study the formula’s effect on schools for two years while still using the old system.
“The switch does not get flipped on this until two years. And so the next legislative session, we’ll have the opportunity to make those changes that we find,” she said.
Lawmakers reviewed numerous technical amendments to the bill on Saturday, including changes to the makeup of the Commission on School Funding. The amendment bars people who have been lobbyists within the previous two years from joining the panel, and requires members to have a background in school finance, taxation or economics.
Committee members also discussed concerns raised Tuesday about whether the formula’s plan to sweep up some 80 local and state revenue sources into a single state education pot was compatible with constitutional provisions governing the net proceeds of minerals (mining) tax.
Brenda Erdoes, head of the Legislative Counsel Bureau’s legal division, assured lawmakers that the bill was within the boundaries of the Constitution, which requires net proceeds to go back to the local government entities that impose it.
“And so that is what happens here — it goes into the formula and then it comes back out exactly to the way that it was put in,” she said. “Part of the overall picture of this bill is to have … all the money into one place, so you have that full fund to look at as you’re deciding what money will be used to fund education. And then the net proceeds of mines — that money will come back.”
The three Republican members of the committee raised several concerns with the bill before two of them voted no. Sen. Pete Goicoechea echoed criticisms of superintendents from rural counties he represents, saying he believes the mechanism mean to “hold harmless” rural districts that would lose money under the formula is simply freezing them at the same funding level for several years.
“I realize we’re taking the first step,” he said. “I just want to make sure when you take that second step we don’t fall.”
Sen. Ben Kieckhefer said he was wary of the broad powers of the Commission on School Funding, which would track the progress of the funding formula in the interim and set levels for “weights” that apply more funding to students with greater needs. Those assumptions would inform the governor’s recommended budget.
“It was suggested that it functions, or should function, like the Economic Forum,” Kieckhefer said, referring to the panel of economic experts who makes projections about tax revenue that form the basis of the state budget. “And I thought about that, and I think Economic Forum works really well. And I also think that probably when it came up to be created I may have voted against it based on a lot of what I just said.”
In the end, he voted in favor of the bill.
“I think at some point you just need to sort of walk off the plank and take a leap of faith that we as a legislative body are going to be able to address any inequities that are created,” he said.
The bill now heads toward its next step — a vote of the full Senate.