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.

Jim Richardson, NFA lobbyist and UNR professor, educates CSN faculty on impending state budget cuts.

Contributed by Adrian Havas, NFA-CSN secretary.

UNR professor and NFA lobbyist James Richardson met on 5 Feb 2010 with the chapter at West Charleston campus of CSN to discuss pending budget cuts and their effects on faculty and programs.

He began on a positive note. “We have good relationships with people in the governor’s office and the budget office of the state,” he said. “We defeated a $100 million cut in our budget during the last Legislative session.”

It is at the upcoming Special Session called for Feb. 23 by Gov. Gibbons that Richardson said that NFA members could “do some good.” He noted a meeting held just days earlier in which the Interim Finance Committee of the Legislature “was educated” about what effect cuts of the magnitude being discussed will have on the NSHE system.

“Our Health Care plan is, regrettably, on the table,” Richardson said. “Senate Majority Leader Steven Horsford said it’s on the list.”

Richardson urged NFA members to send emails to Senate Finance Committee members to urge them not to reduce this.

Asked about what tone to take in these email communications, Richardson said that should try “not to sound arrogant, or uncivil, or self-serving.” He added that anecdotes of how our classroom experience, and the students’ educational needs, would be helpful.

He said the NSHE system is lucky to have Dan Klaich as its current chancellor. “He’s articulate, intelligent, and people believe him,” Richardson said.

“Klaich is emphasizing that we need to get the autonomy to determine the cut,” he added. “And we will be cut. Anyone who doubts that is not facing facts.”

Richardson then went forward with an outline of where the cuts would likely happen. He later noted that this was not the complete list, but only the most likely targets.

First, he said that student fees for tuition, etc., are likely to rise. “That’s very regrettable, since over the past three years they have gone up 28 percent.”

Second, academic program reorganization is likely, Richardson said. There are basically two ways that the Regents can fire professors: declare “Financial Exigency” which is akin to bankruptcy (the state of Hawaii has recently done this.) The next way is “program reorganization.”

“There is some bumping (seniority) rights, but they aren’t written down,” Richardson said. “This is a more subtle way of making staff reductions, and it offers fewer protections, frankly.”

Richardson said that 40 faculty members have been terminated at UNR under this strategy over the past year, “and then the economy collapsed.”

The third and last major way the budget cuts will be enacted is through pay cuts, he said. “This will happen,” Richardson said. “We will fight to make them temporary.

“You can help by lobbying the Regents. Any code changes should be temporary.”

Senate Chair N. Mark Rauls said that the faculty need to debate any changes to the Regents Code, as well as Financial Exigency. It was pointed out that Regent Chair James Dean Leavitt has reportedly already directed his staff to begin filing papers for Exigency.

The talk turned to the subject of the state’s boom-and-bust cycles, and how the state needs a more stable tax base to support its existing infrastructure, including the colleges and universities.

We have the most screwed up tax structure in the United States, no doubt about it,” Richardson said. “No sales tax on services, no extraction taxes on mining. The governor vetoed Sen. Horsford’s proposal for a broad-based business tax and 40 other ones.”

Other possible taxes Nevada could adopt: a tax on Internet sales generated here, and a tax on services.

Executive Board member Steve Konowalow said that the gaming industry does not pay enough tax, compared with other states with legal gaming. One of the CSN staff present, who said she had moved in the last several years to Nevada from Kentucky, suggested a state lottery, but it was pointed out that the gaming industry has jealously protected its turf in this regard and has rebuffed any legislative proposals to enact a lottery.

Richardson brought the discussion back to the topic of budget cuts.

“The coming Legislative session will be horrendous in terms of revenue coming in,” Richardson said. “We need to do something in this state to improve this.”

One faculty member who identified herself as being in International Languages also a recent transplant to Nevada said that we should “look beyond taxes” for the solution to NSHE’s financial problems.

Richardson replied, “We need to look everywhere.”