By Ray Hagar, Nevada Newsmakers
Nevada is expected to receive about $4 billion in federal money with Congress approving a national $1.9 trillion coronavirus rescue package last week.
Although the state may soon be flush with federal cash, State Sen. Heidi Gansert, R-Reno, warned her fellow lawmakers not to grow government or use it to boost funding for short-term projects, especially if the state is going to have to find new money in the next budget cycle to sustain that growth or those projects.
“Our budget is not nearly as bad of shape that people may suggest,” Gansert told host Sam Shad. “And already, when you look at education, there might be some slight cuts to k-12, but there’s twice as much money, probably three to four times as much money, that is coming into from from the federal government. And the reason it is not on our books, the state’s books, is that it is going directly to the school districts. So while at the state level there is a cut, there’s far more money to cover that and plug that multiple times coming from the feds. And that is even before this $1.9 trillion package.
“I think we just have to be wary about the money, Gansert said.
“I’m concerned about so much money coming in that we will end up growing government to the point where we just can’t support it,” she said. “We need to make sure that we help those who need help but not expand government because there is an opportunity to do so, just because there is money.
“We need to be very disciplined about how we spend the money and use it in (areas) to train and retrain our workforce.” she said.
The pandemic helped collapse Nevada’s top industry — tourism and hospitality — and resulted in thousands of layoffs across the state, especially in the large cities of Las Vegas and Reno.
Nevada, however, remains a state with one of the nation’s worst unemployment crises, according to federal statistics. At the end of December, Nevada’s unemployment rate remained at 9.2 percent, according to the U.S. Bureau of Labor Statistics.
Only Hawaii, also with a tourist-based economy, was worse off than Nevada in the federal report. Nevada unemployment peaked in April at 30.1 percent.
“I agree that we needed an economic bridge,” Gansert said. “We were falling off a cliff. We had to shut down our major industry for over two months. We had lots of closures or partial openings, so we needed an economic bridge.”
In January, Gov. Steve Gov. Steve Sisolak released a $8.7 billion two-year state general-fund budget projection, proposing cuts to k-12 and higher education but increases for health care because on the Covid pandemic and more laid-off workers joining Medicaid.
“We need to make sure that we don’t put that (new money) in our current budget, so we do not face major challenges in two years (when the next biennium budget process begins),” she said.”We need to use it as an opportunity to turn some things around.”
Total education spending is projected to be about $7 billion in Nevada over the next two years, when considering local, state and federal funds. Sisolak’s budget would decrease higher education money by $80 million but he plans to shore that up with the expected federal spending, according to various reports.
Although both houses of Congress have passed the bill, the Senate’s changes to the bill must still be approved by the U.S. House.
President Biden wants to final bill to be signed by March 14, when current unemployment benefits expire. While the minimum-wage increase failed to pass, citizens who earn less than about $70,000 annually ,should receives checks of $1,400.
Nevada’s economy would bounce back more quickly if its citizens are widely vaccinated, Gansert said. Two states, Texas and Mississippi, have removed statewide mask mandates to block the spread of the virus and will allow businesses to open 100 percent.
Nevada, however, is not ready for that, Gansert said.
“I think it will depend on our vaccination rate and Covid testing rates,” she said. “So we seemed to be behind on testing originally and we’ve had a slow start for vaccines. But I think we are really starting to turn that around. So I am excited about that and I’m very hopeful that individuals go get a vaccine. So I want to send that out. The message is not partisan. Get your vaccine because that is going to help our community get safer and open up (the economy) faster.”