By:  Doug Busselman, Executive Vice President

Those involved in thinking about Nevada public policy seem to spend a lot of time putting our condition in relationship to everybody else. 

Instead of discussing how much money is spent on education in the context of specifics for where more funding is needed and what we’ll get for the increased allocations, the policy debate is focused on where Nevada ranks in per-pupil spending. 

Because not all states have similar components involved in what makes up the state spending comparison, it’s not always very accurate in detailing the true situation.  Then again, the purpose for the comparison isn’t intended to be a complete explanation – it’s suppose to be a public report card to say “give us MORE” cause we aren’t doing too well, compared to every other state.

Nevada Spending Debate:

As we prepare for the 2009 Nevada Legislature, a lot of the policy considerations being kicked around are very slanted in the direction of how the lack of state revenue is the problem. 

On the other hand, Geoffrey Lawrence, a fiscal policy analyst at the Nevada Policy Research Institute, has put together his thoughts on the situation in a commentary, entitled “Legislature Addresses Imaginary Shortfall – Band-aids Are Applied To Prop Up High Spending”, - http://www.npri.org/publications/legislature-addresses-imaginary-shortfall   This evaluation documents the track of how Nevada’s state revenue have progressed since the 2000-2001 biennium.  These numbers reflect the following:

Biennium            Actual General Fund        Percentage of Increase
FY00-FY01           $3,380,939,852
FY02-FY03           $3,577,311,907                       5.8 percent
FY04-FY05           $5,145,670,977                     43.9 percent
FY06-FY07           $6,203,846,095                     20.5 percent
FY08-FY09          ($5,831,546,286)                   - 6.0 percent
FY10-FY11          ($5,565,561,798)                   - 3.0 percent
(projected)

Elliott Parker, a professor of economics and chairman-elect of the Faculty Senate at the University of Nevada, Reno presented his perspective in a December 21st, 2009 Las Vegas Sun Guest Column entitled “Comparisons show spending isn’t Nevada’s problem”
http://www.lasvegassun.com/news/2008/dec/21/does-our-state-government-have-spending-problem/

The crux of Parker’s perspective is that, based on the latest national statistics, “only 5.5 percent of Nevadans work for the state or local government – the lowest share in the 50 states by far”.

Breaking down this information further, Parker reports that of the total, a fourth of the total are state employees, the rest are in local government.  Also, nearly one-half of the total are employed in K-12 education (which has an employment total that is also the lowest in the country).  10 percent of the overall total, work in higher education, according to the information Parker presented in his column.

As a share of total state income, Nevada’s state government spending is the lowest in the nation.  Parker goes on to report that when you add in the spending by local government, Nevada ranks 48th in government spending as a share of income.

All in all we’re not supposed to believe, according to Professor Parker that Nevada is running wild with the checkbook and in summary he’s also concerned that further, significant budget cuts will cause severe damage to our state’s educational system and our economy. 

Others’ have also considered Parker’s perspective to be less than a complete picture http://nevadataxpayer.com/archives/243# and have taken their own approach in questioning the logic of how we’d  be better off with more spending instead of less taxes.

Instead of compared to what all other states might be doing – we need to figure out what Nevada needs to do for itself.  Before we get stampeded into revenue enhancements for the sake of more money – or rampant ax swinging for further budget reductions…let’s have an in-depth public discussion that involves knowing what we get for the funds spent.  From this basis we can move forward and hear proposals in the form of clear details on what (if anything) we actually need more of.

Tomorrow we’ll look at more of the emphasis being placed on increasing taxes instead of cutting spending.