Summary
Currently, the Nevada Constitution provides for a Board of Regents to govern the Nevada System of Higher Education (NSHE). Nevada Question 1 is a constitutional amendment that would remove the Board of Regents from the state constitution and allow the legislature to change the governance structure of the NSHE and could make the Board of Regents answer to the legislature not directly to voters. It also would require the legislature to direct an external financial audit of NSHE once every two years, which would be a reduction in frequency from the existing practice of annual financial audits.
Fiscal Impact
It is unclear whether direct control by the legislature of the NSHE budget would affect total outlays.
Proponents’ Arguments
Carol Lucey and John Gwaltney, president emeriti of two different Nevada community colleges, argued to the legislature that the Board of Regents, as a single governing board, does not consider the unique needs of each of the colleges and universities it oversees. They argued that the existing governing structure is antiquated and that the amendment will “assure that precious state resources will actually go toward serving students.”
Representatives for the Las Vegas Chamber of Commerce testified in support of the amendment, claiming that the change would make higher education more responsive to the needs of students and the state’s goals for higher education and would better align “the needs of today’s students with the needs of employers.” Maureen Schafer of the Council for a Better Nevada also argued that the NSHE administration is too small for the number of institutions it governs and that change is needed because Nevada higher education must “scramble and compete for students across the U.S. and worldwide.”
Opponents’ Arguments
The Nevada State Education Association, a union representing teachers in K-12 schools in Nevada, has opposed the initiative on the grounds that independently elected boards are more directly accountable to the public than appointed boards. “Elected boards are in place to ensure schools and colleges reflect the values of the people, providing direct lines of accountability to the community,” the union argued. It continued: “This is the main reason elected boards are preferable to appointed or hybrid models. Appointed officials are shielded by an appointing authority who typically has significant other responsibilities in addition to board appointments.”
Dale Erquiaga, the acting chancellor of NSHE, testified in opposition to the measure and indicated he was doing so at the direction of the Board of Regents, who wished their positions to remain elected. A representative from the Nevada Republican Party also testified in opposition, claiming, “The sponsors point out the resolution makes no changes to the Board of Regents beyond removing its constitutional protection. We submit that when there is a move to remove protection, it is because someone feels those protections are in the way.”
Discussion
NSHE includes eight member institutions:
- 2 four-year universities;
- 4 community colleges;
- 1 state college offering some four-year degrees; and
- 1 public research institute.
Removing the Board of Regents as an independently elected governing body for NSHE would empower the Nevada Legislature to take greater control over the policies and budget decisions for NSHE and its member institutions.
Prior to its appearance on the ballot, the constitutional amendment was proposed in the legislature, where it was approved in both the 2021 and 2023 regular sessions. The state senate approved it unanimously in 2021, and the assembly approved it with a vote of 30 to 11. In 2023, the Senate again approved the proposed amendment by a vote of 19-2, while the assembly did so by a vote of 34-7. All legislative Democrats supported the amendment each time, while legislative Republicans were split on the issue.
Alterations to the governance structure of NSHE have been debated frequently in the Nevada Legislature. A prior proposal to remove the constitutional status of the Board of Regents was referred to the ballot in 2020 after it passed the legislature in 2017 and 2019. Voters narrowly rejected that proposal by a margin of 50.15% to 49.85%. Supporters of the 2020 initiative included a wide array of organizations and a committee in support of the measure raised and spent $1.36 million. By comparison, no known ballot measure committees have formed in support or opposition of the 2024 initiative, and no campaign contributions or expenses have been reported.
In 2021, lawmakers directed legislative auditors to review certain NSHE accounts. The auditors reported “insufficient oversight” of budgets and “inappropriate or questionable” uses of student fees and tuition. Two institutions spent a combined $6.7 million on athletic and band programs that should have been used for counseling services, while the four-year universities used nearly $5 million in operating funds to pay for capital projects. In many cases, funds were not disbursed with proper approval or were manipulated to avoid reversions of these funds to the state.
NSHE maintains its own independent financial records, but its assets are ultimately owned by state taxpayers, and its financial reporting is included as a separate column within the state of Nevada’s Annual Comprehensive Financial Report. It is unclear how the state would reconcile its annual financial reporting if audited statements from NSHE only become available biennially. The lack of availability of audited financial statements from NSHE could result in a qualified audit opinion for the state of Nevada and hamper the state’s creditworthiness.
In addition to financial reporting, the shift in management contemplated by Ballot Question 1 would ultimately require the Nevada Legislature to review and approve the NSHE budget on a line-item basis. Currently, the legislature only approves an annual state support amount that is transferred to NSHE from the state’s general fund, while NSHE derives additional revenues from grants, endowment returns, and student fees and determines its own spending budget with these revenues.
It is unclear how removing the constitutional status of the Board of Regents would affect these or other outcomes. The change could allow lawmakers to appoint the Regents or to manage NSHE finances directly. The position of both a Nevada legislator and a Nevada regent is part-time, and there is no clear indication that legislators are better positioned to manage NSHE and its various member institutions.