Gov. Joe Lombardo released his budget to state legislators before his state of the state address last week, and almost immediately Democrats began raising concerns, saying they believed it contained “fuzzy math.” (Photo by Richard Bednarski for Nevada Current)
Gov. Joe Lombardo may have struck a conciliatory tone toward legislative Democrats in his state of the state speech last week, but errors made by his office are bringing early acrimony to the state budgeting process.
Senate Majority Leader Nicole Cannizzaro, a Democrat from Las Vegas, said the first-term Republican governor’s proposed budget has “major structural issues” that make it unworkable and unsustainable. The proposed executive budget includes spending $335 million more than projected revenue.
“We are facing an unprecedented situation with the budget proposal,” Cannizzaro said Tuesday during a legislative budget subcommittee. “I cannot recall a time when the governor sent the Legislature a budget that simply didn’t add up.”
Cannizzaro said Lombardo’s budget cannot simply be tweaked through the normal budgeting process that occurs every legislative session and “needs to be significantly rewritten” and will require “major amendments” from the governor.
Staff from the governor’s office acknowledged that budgeting errors were made. They placed the proposed budget’s structural deficit at $335 million–about 2.6% of the $12.7 billion budget, which would cover state spending from July 2025 through June 2027.
They said they had already worked out a series of changes to reduce that deficit to $85 million and were working around the clock on additional amendments.
Ryan Cherry, Lombardo’s chief of staff, told lawmakers he took full responsibility for the budget issues because they happened underneath his watch: “I have to own it. We are moving forward to correct it. I just want to say to all of you I understand the frustration, I hear the frustration.”
Lombardo on Friday fired the director of his governor’s finance office, according to The Nevada Independent. Amy Stephenson had been in the role since July 2022. Minutes before Tuesday’s subcommittee was set to begin, Lombardo announced a replacement: Tiffany Greenameyer, who had been the deputy director for fiscal services at the Nevada Department of Health and Human Services.
Debi Reynolds, Lombardo’s deputy chief of staff, told lawmakers she started her job two weeks ago and has been “working furiously” with the budget office since then “to identify all the errors that have occurred in the budget.”
The Nevada Current asked the governor’s office when the $334 million budget issue was first identified but received no direct response.
Lombardo spokesperson Elizabeth Ray in an emailed statement said “the executive budget remains balanced through one-time funding” and said it appeared Democrats’ concerns were related to a specific line item about making K-12 teacher and staff raises permanent.
Ray did not respond to a request to clarify whether that means the governor disagrees that a structural deficit exists, or to elaborate on any specific budget issues mentioned during Tuesday’s meeting.
The governor’s executive budget anticipated around $120 million of funding allocated during the 2023 legislative session being reverted back to the state general fund for uses approved in this year’s session. But many of those reversions are not allowed.
That pool of money included tens of millions earmarked for the Campus of Hope, a regional homeless campus backed by the gaming industry and public dollars.
Assembly Speaker Steve Yeager, a Democrat from Las Vegas and the sponsor of the bill enabling the creation of Campus for Hope, suggested the governor’s expected revisions seem high even beyond that high-profile project.
“Obviously, that one really caught our attention when we looked at this budget of things that weren’t supposed to be in there,” he said. “Unfortunately, we’re in the situation where we just need to know every dollar that’s been accounted for on that reversion amount so that we can ensure those amounts will actually be available for the next biennium.”
Cannizaro told the governor’s office that amendments to the executive budget must be given to the Legislature by Jan. 29.
Lombardo released his budget to state legislators before his state of the state address last week, and almost immediately Democrats began raising concerns, saying they believed it contained “fuzzy math.”
In his address, Lombardo called for bipartisanship and praised fiscal responsibility, saying “now is exactly the wrong time to strap more burden on the backs of hardworking Nevada families.”
He said he declined “millions of dollars in state agency requests for more funding.”
It was unclear at Tuesday’s meetings what adjustments are being made by the governor’s office to eliminate the structural deficit in his recommended budget. Several lawmakers pointed out this could lead to confusion as agencies give their own scheduled presentations to lawmakers about the budgets they’re expecting to receive based on the governor’s proposals.
“Is it going to fall on us as the Legislature to inform somebody who believes they’re getting $85 million plus out of this budget that there’s not money there for them?” asked Yeager.
“No,” responded Greenameyer, the brand new director of the governor’s finance office. “I will continue to review the budget and see if we can provide more amendments to reduce that $85 million. I only had three days, so I’m still reviewing.”
Cannizzaro thanked the new director and deputy chief of staff for their efforts but pointed out the drafting of an executive budget isn’t a three-day or two-week process.
“I am at a loss for how it is that, despite all of these conversations happening, despite this entire process that has existed, that does exist, that existed last time, this is the budget that was presented to us,” she said.
The 2025 Nevada Legislature convenes for its once-every-two-years general session on Feb. 3.