Gov. Brian Sandoval's office Monday announced a budget amendment designed to repair a $120 million hole in his budget.
But, while Sandoval touted the amendment as pumping the majority of the new money into K-12 education, it simply fixes the hole in that budget caused primarily by his administration's original error in calculating how much could be taken from the school district bond reserves.
The original budget projected $425 million could be taken from those reserves. After reviewing complaints from the school districts who argued that amount wasn't available, Sandoval's administration agreed and lowered that amount to $319 million - creating a $106 million hole in the budget.
That and other changes in projections raised the total budget gap to just more than $123 million.
The amended budget is pumped up by a $25.77 million boost the state will get from a better than expected federal contribution to Medicaid costs during the next two years. That increase was actually the result of a decline in the per capita income Nevadans made this year. Under the federal formula, the lower the per capita income in a state, the higher percentage the federal government contributes to Medicaid costs.
Another $41.4 million in added revenue will come from higher than expected property tax collections for the net proceeds of mines forecast for the coming two-year budget cycle. The net proceeds of mine tax itself is also expected to come in higher, adding $17.86 million to the equation.
Likewise, the portion of the Governmental Services tax going to the K-12 budgets is now expected to come in above original estimates - adding another $6.87 million to the pot.
The 12-page amendment also lists several dozen other changes to the original budget which director of Administration Andrew Clinger said net out to zero dollars difference in the total General Fund budget.
He confirmed that the money added to the education budget doesn't actually increase the per pupil amount in Sandoval's budget plan, but closes the shortfall and, once again, balances the budget.
One major change announced as part of the amendment is to delay plans to release school districts from mandatory spending levels for specific K-12 education programs such as class size reduction and all day kindergarten. Putting the money from a half-dozen such mandated programs into a block grant fund was designed to give school districts more flexibility. The new proposal delays that move until the second year of the biennium. Sandoval staffers said that will give school districts time to plan what they want to do and how to do it.
Another part of the amendment fixes an issue raised during the budget overview hearings when director of Public Safety Chris Perry questioned the wisdom of eliminating 77 positions responsible for preparing pre-sentence investigation reports and turning those responsibilities over to the counties. He argued the vast differences between resources available to different counties would make it difficult to standardize those reports.
The new plan keeps the state system, but requires county district court assessment fees to pay the tab. That eliminates $2.5 million worth of retirement and leave buyouts for those employees.
Lawmakers have asked fiscal staff to review the budget amendment plan before commenting on it in detail.