Nevada Treasurer Zach Conine intends to use funds from the state treasury to sustain services the state is at risk of losing in the event of a government shutdown, which he says is a common fiscal practice. But Conine says he’s concerned about Nevada being paid back by President Donald Trump’s administration.
Conine, a Democrat who is running for Attorney General, said he’s speaking out to “just let Nevada know it’s going to get weird before it gets unweird,” should Congress allow the government to shut down. “We’re doing what we can to understand what’s going on and preparing the state treasury to front these dollars.”
In the past, the state has provided funding to keep programs such as school lunches served during government shutdowns, and “historically, that has gotten cleared up when a continuing resolution gets passed,” Conine said during a phone interview Thursday.
Fronting state money poses “an opportunity cost issue,” Conine says, but allows vital services to continue, based in the past on the federal government’s pledge to reimburse the state.
“I don’t have a ton of comfort that they’re actually going to make good on the promise. We don’t know that they’re actually going to pay us back. The government has not released guidance on whether or not we will get paid back. If they did make a promise that they were going to pay us back, would they actually do it?”
If the feds don’t settle up, Conine says, “the state will be out tens —maybe more — millions of dollars, depending how long we front for them.”
The state receives, on average, $5 million to $30 million a day from the federal government for programs at risk of shutting down, including Temporary Assistance for Needy Families (TANF), which provides assistance to families for essentials such as rent and childcare. Funding expires Sept. 30.
Conine says the Federal Office of Management and Budget (OMB) generally sends information to federal agencies who communicate details to states, such as what employees are deemed essential, who can be furloughed, and how agencies are to handle payments.
This time, the only memo Conine said he’s “seen to date” from OMB suggested the federal government “fire a bunch of people if given the opportunity to do so. Use this shutdown in order to do dramatic reductions in force.” The OMB, he says, wants agencies to fire employees who are not currently funded through a budget, and those with jobs outside the administration’s priorities.
What that probably means, Conine says, “is you’re going to have a bunch of federal employees laid off. Even when the funding gets restored for some of these programs, there won’t be anyone on the other side to do the work.”
An existing example, he says, are student loan forgiveness programs, which “still exist but the people we need to make those programs work aren’t there anymore.”
Medicaid and Medicare will not be affected, Conine says, because they are already funded. However, “peripheral” programs, such as substance abuse programs, or services to sign up for Medicaid, could be curtailed.
Gov. Joe Lombardo is aware of Conine’s plans, and has voiced no objections or input on which programs to sustain, the treasurer says.