News Carson City

State lawmakers adjourned their special legislative session just before 6pm this evening, re-balancing a badly bleeding state budget and dreading what lies ahead when the next regular session begins in early February. It’s likely to be akin to a showdown at the OK Corral with conservatives who want no new or higher taxes versus those who fear Nevada could become a failed state unless it does raise taxes.

This evening, lawmakers cut another $73 million, mostly in the last remaining vestiges of reserve funds, no cuts that directly affect service levels (or what little remains of them). The state also borrowed $160 million from a government investment fund. The state will pay back the loan at an interest rate of just over 2%. Lawmakers also effectively levied a $2 million dollar tax hike on taxi cab businesses in the state. Businesses across the board that collect sales taxes will get to keep a little less of a “fee for collecting” them for the state. Mining companies will pay a $28 million tax ahead of schedule. The advance pay arrangement stops in two years. The state is withholding $25 million normally paid to hospitals for medical services given to those in accidents that are under or non-insured. Local counties will have to make up the difference with their county hospitals, IF they can. Cuts to state disability services will force longer waits for treatment for autism therapy, personal assistants, independent living programs and traumatic brain injury. Families with autistic children say delays in therapy can doom a child to a lifetime of disability and then become a burden on taxpayers. They say it makes no human or fiscal sense to delay services. There will also be cuts in the state tourism budget of $2.8 million, and a cut of $75,000 to efforts to establish a Nevada economic development office in China. The State Office of Economic Development will turn back over to the state budget $1.3 million, amounting to a nearly half million dollar hit to the Nevada Development Authority that serves southern Nevada.

Budget analysts remind everyone that these are one-time cuts involving one-time money. When the state enters next fiscal year in July, many of those funds must be already back in place for state departments to function. Its a battle between those who prefer low tax, low service level government versus those who see government as offering more of a consistent level of service regardless of economic conditions. In fact, they say, it’s precisely in bad times that the need for government services goes up, not down.

The four bills that contain all this are expected to be signed by Governor Gibbons this week.