Governor's Budget Increases by $300 Million - KTVN Channel 2 - Reno Tahoe Sparks News, Weather, Video

Governor's Budget Increases by $300 Million

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Last night, Governor Brian Sandoval delivered his State of the State Address and laid out the challenges Nevada faces, heading into the legislative session.

His purposed budget is $300 million more than the current biennium.

"We must only allow for growth that our fragile economic recovery can bear," Sandoval said.

Elliott Parker is a Professor of Economics at the University of Nevada.

He says that while the budget reflects economic growth, it's still more cautious than it is ambitious.

"It's a relief that we're not going to be continuing at this, next biennium, with more severe cuts like we've gone through before," Parker said.

But Parker says the budget is also disappointing because it doesn't make an effort to restructure our tax system.

Right now, our revenue relies on gaming and sales tax.

He says that simply won't work anymore.

"Our tax structure should reflect our economy," Parker said. "We're not really dealing with that, one more time. So, once again, we are going to be punting that down the road."

Parker says the reason for the budget increase is because of creative financing by the state government, combined with residents spending more money again.

Sandoval credits that spending to economic growth.

"State revenues are growing again because our economy is growing again," Sandoval said. "In the last 24 months, Nevada businesses have created almost 30,000 new jobs."

The Governor's general fund spending is up to $6.5 billion but that's still $400 million less than it was four years ago.

Parker says the modest growth also comes with a growing population and rising costs.

"We have increasing costs for unemployment," Parker said. "We have rising social service costs because we have a lot more people unemployed. So, these costs have put a lot of strain on the social service system in this state."

Nevada has had to borrow money from the federal government for the past few years.

The Silver State owes more than $700 million just for unemployment benefits.

Sandoval says his plan will pay that back by 2016.

Written by Paul Nelson

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