Nevada lawmakers have approved a package of about $88.5 million in spending cuts that will wrap up the state’s plan to balance the current fiscal year budget, but more cuts are likely on the way next month as the economy continues to recover from the COVID-19 pandemic.
Legislators on the Interim Finance Committee, a 20-member board that oversees spending between legislative sessions, voted unanimously on Thursday to approve the proposed budget cuts, which included $21.5 million in reversed one-shot appropriations and another $66.9 million cut from state agencies and departments.
Lawmakers on the committee had earlier this month approved a general outline of Gov. Steve Sisolak’s plan to address an estimated $812 million shortfall in the state’s 2020 fiscal year budget, which ends on June 30. That plan included tapping into $401 million from the state’s “Rainy Day” budget reserve fund, federal reimbursement through the CARES Act and a host of other transfers.
The meeting on Thursday delved more into the specifics of what kinds of cuts that state agencies will be required to make to close out the budget for the fiscal year that ends Tuesday. Many of the “cuts” are a combination of budget reserves and dollars that agencies would have reverted back to the state budget because of either internal savings or a decreased demand for services caused by the COVID-19 pandemic.
But the cuts approved on Thursday were the easy part. With Gov. Steve Sisolak’s announcement that the state is estimating a $1.27 billion shortfall for the fiscal year beginning Wednesday — about 25 percent of the year’s operating budget — lawmakers will have to make even tougher decisions during the looming special session set for early July.
"A number of these are going to hurt,” Interim Finance Committee Chair and Assemblywoman Maggie Carlton said. “We'll just have to find other ways to support the things that we're passionate about."
Lawmakers did not delve deeply into the cuts, but the initial round of reductions appeared to not have a drastic effect on state-provided direct services.
Department of Health and Human Services Director Richard Whitley, asked about a proposed $4.8 million reversion from the state budget account for childhood autism services, said the sticker price of the “cuts” did not reflect the reality of the situation.
The state’s Autism Treatment Assistance Program is currently serving 890 individuals with a wait list of 31, thanks to a combination of enhanced federal matches in funding for the program, as well as lowered demand because of hesitation of families to invite specialists into their homes during the pandemic.
Still, Whitley said cuts were likely to come for the department’s budget for the next fiscal year, and that he hoped to take steps to minimize any reductions in state-offered services for vulnerable populations.
“We have not deliberately cut services for this (budget) closing,” he said. “I think you'll see when we come before you during the special session that we've tried to be deliberate in focusing on how to do the least amount of harm.”
Sisolak said during a press conference on Wednesday that his office would reveal more details as to how it planned to deal with the 2021 fiscal year shortfall — $1.27 billion — after tax revenue numbers for the month of April were published. The governor previously said he’ll propose one day a month furloughs for state employees and roughly 50 layoffs to help address the expected shortfall.
Although past votes on the committee related to the budget have split on party lines, all lawmakers voted to approve the recommended agency cuts during Thursday’s meeting.
Republican Sen. Ben Kieckhefer said the recommended budget plan was “absolutely necessary to keep up in fiscal health,” but added that he hoped for a more collaborative process on determining budget cuts moving forward.
“As we move into the next fiscal year, I sure hope that the Legislature gets much more of a say,” he said.