Submitted by Jim Richardson, NFA Lobbyist

Yesterday was very busy with public and some private sessions of import. Chancellor Klaich did an admirable job late yesterday of testifying on behalf of NSHE institutions, and their students, staff, and faculty before a committee of the whole in the Assembly (see story below). He also made a brief appearance before the committee of the whole in the Senate, but will return this morning to finish testifying about the impact of the large cuts that are being considered for NSHE. There was also quite effective testimony offered to both committee of the whole by students from NSHE institutions, including a large contingent from southern Nevada who had ridden buses all night to get to the special session.

 There were a number of statements made to the press and in private by the Majority Leader of the Senate, Steven Horsford, and the Speaker of the Assembly, Barbara Buckley, that the 10% operating cuts for both K-12 and higher education were too high, and must be reduced. We were heartened by those comments, and by other comments made to me privately by leaders of both parties. We were also pleased to hear Majority Leader Horsford talk about the need to achieve proportional cuts (see RJ stories here), because the latest plan from the Governor continues the pattern of deeper cuts to higher ed than to K-12. (That new plan deleted the proposed 1.75% cut to salaries in K-12, but left then in the list of proposed cuts for NSHE professionals.) K-12 certainly needs adequate funding, but so do NSHE institutions.

It should be noted, as I reported last week, that the total cuts for NSHE are actually significantly above 10% when all the various cuts are added up, so, we are working hard to at least achieve parity in whatever cuts are made. (Those proposed NSHE cuts include an additional salary cut of 1.75% for professional employees, major cuts in funding for Millennium scholarships, cuts in funding usually used for buildings and servicing bonds, and some other cuts.)

There is a dispute over the size of the additional salary cut for professional employees in NSHE. The 1.75% figure being used in the budget proposals from the governor is supposed to be based on the additional required furlough or salary cut for classified employees f the state, but if so the figure should be much closer to 1%. Chancellor’s staff, especially Mark Stevens, are trying to call attention to this apparent mistake, which does amount to a difference of several million dollars system-wide.

 Other issues being dealt with include the governor’s proposal to draw down the reserves for PEBP (the  health plan for all state employees including NSHE employees) significantly, which would jeopardize the fiscal health of the plan. This proposal is being re-examined because some legislative leaders do not like the plan, but alternative sources to replace the funding that would accrue from the proposal are scarce.

 Also, there has been some discussion of the very bad idea floated last week at an IFC hearing to defer retirement contributions for state employees for a year, and this is being addressed as well, working with the Benefits Coalition, particularly Marty Bibb, who is head of Retired Public Employees of Nevada. He has gathered important information indicating that such as idea is illegal on constitutional grounds, and demonstrating that our benefits package is already below that of most other states. We hope this idea will not be taken seriously, but are not taking any chances.

 The Benefits collation is meeting today at noon to discuss the PEBP and PERS issues, as well as other matters that affect state and other public employees. Anyone is welcome to attend this meeting if they are in Carson City.

 Prognosis: This special session will last several days, I think. And, given the animus that is being displayed, particularly between the governor and the legislative leaders, solving the crisis will not be easy. Some suggest that the Legislature will develop its own solution (which must be one that would survive a veto, which means a two-thirds vote), pass that solution, and then recess for the five days that the Governor has to sign or not sign the bills. If he signs or lets the bills become law without his signature, then the legislatively crafted solution will prevail. If he vetoes, then the legislature would have to reconvene to attempt an over-ride of the veto.

 I will be in Carson City again today, and will report afterward. Let’s keep working hard on saving higher ed opportunities for Nevada.

College of Southern Nevada economics professor and NFA-CSN chapter president Dr. Shari Lyman explains in a panel discussion aired on KNPR’s “State of Nevada” radio show.  If you missed this Monday broadcast (8 Feb. 2010), hear it here (the first half-hour of a two-segment program).

For example: Our beloved gaming corporations pay far higher tax rates in other states, and they happily compete for gaming market share in states with gaming tax assessments as high as 20% (Colorado, Iowa, Louisiana, Missouri), 35% (Indiana), and 50% (Indiana and Pennsylvania).  Nevada asks for a measly 6.75. By not increasing our gaming tax rate and collecting more revenue from these corporations to support our public schools, colleges, and universities, we are helping to fund these other states’ public schools, colleges, and universities.

Let’s put Nevada public education first!  Please, Mr. Wynn, may we have the 8% you pay in New Jersey and Mississippi?

If you missed Governor Gibbons’ broadcast last night, you can read the text of the 2010 “State of the State” message here (.pdf) or here (website).

NFA Advisor draws your attention to the Gibbons plan for protecting teachers’ salaries: the Education Gift certificate.

“You can use the gift certificate to donate money to a non-profit organization that will make sure your money is spent ONLY on teachers’ salaries. For those of you who can afford to help our teachers, I encourage you do it.”

Dear Governor, with 140,000 Nevadans already out of work and 90,000 more (including teachers and other public servants) projected to join them over the next 18 months, with a 4.6 percent decline in personal income and a massive decrease in home values, just whom do you suppose can still afford to give charity to teachers?

Well, the Nevada mining industry continues to earn record-breaking high profits. Maybe these multi-national companies will donate money to keep our public education afloat.

The bigger issue here is ideology. Do we believe that funding public education is the privilege of the wealthy who can afford to make charitable donations (and receive federal income tax credits/subsidies) for doing so? Or do we accept that, because we give every citizen the right to vote, funding public education is the obligation of every citizen and that fair taxation, including taxation of multi-state corporations who bring business here with the expectation that we will provide them an educated workforce, represents the cost of providing this public service to ourselves and our posterity?

Clearly, our governor believes that Nevada public education, like playwright Tennessee Williams’ Blanche DuBois, should depend on the kindness of strangers. What a helluva way to raise our children and to make our state more attractive to new businesses.

CNBC’s third annual survey of “America’s Top States for Business ’09″ ranks our state 47th in overall business competitiveness and 49th in education spending and achievement.  In commitment to and success in educating youth and adults, only Mississippi does a poorer job than we do.  Have we become the “Mississippi of the West” again?

Why is higher education so essential to the creation of a strong pro-business climate in any state?  As the authors of CNBC’s survey report explain, “Not only do companies want to draw from an educated pool of workers, they want to offer their employees a great place to raise a family. Higher education institutions offer companies a source to recruit new talent, as well as a partner in research and development.”

How are we going to diversify our economy, bringing new, skilled, and highly paid jobs to Nevada, if we’re about to maim and cripple our higher education institutions with deep and severe state funding budget cuts?