Proposal would create ongoing state funding for local public health using insurance premium tax

Amy Heinz Sutherland, health and human services manager for the Nevada Association of Counties, presented Senate Bill 423 to the Senate Committee on Health and Human Services as a follow-up to the 2023 investment in public health (SB 118). The bill would create an account for ongoing, flexible funding dedicated to foundational public health services and proposes a funding allocation model that combines a base amount per county with dedicated tribal and state allocations.

Why it matters: Local public health authorities told NACO that federal categorical grants that funded critical services have been cut or terminated and that Nevada faces a “funding cliff.” Presenters cited an estimated near-$100 million loss in federal grants: approximately $75 million in epidemiology and laboratory capacity (ELC) funds, $11 million in immunization program funds and $10 million in SAMHSA funds. Those cuts, presenters said, have led to staff layoffs and program suspensions.

The amendment presented at the hearing proposes a smaller, phased state investment than earlier interim proposals: $4,925,000 to start with delayed implementation to 2027 to allow planning. Under the proposed allocation model each county would receive a base allocation (the amendment describes a per-county base), with additional pooled funds for tribal authorities and for statewide public-health functions that only the state can deliver. Funding would be restricted to foundational public health services (FPHS) — communicable disease control, chronic disease and injury prevention, environmental public health, maternal/child and family health, and access/linkage to clinical care — and would be administered by the division of public and behavioral health with reporting and oversight.

Local health districts and county public-health leaders described how SB 118 dollars were used: examples included expanded disease surveillance, youth vaping prevention, lab capacity, mosquito abatement, transportation for seniors, and telehealth and IT investments in rural districts. Northern Nevada Public Health, Southern Nevada Health District and smaller rural districts testified about current operational needs and the fragility created by recent federal grant reductions.

Funding source and precedent: The sponsor and presenters proposed the insurance premium tax (IPT) as the revenue source, noting that the IPT is a major and growing revenue source for the state (a 3.5 percent tax on insurance premiums) and has been used for other statutory allocations. Program advocates argued the IPT is a sustainable and logical choice to support public health infrastructure statewide.

Opposition and questions: Testimony in opposition was limited. Representatives of school superintendents later expressed concerns about adding bargaining subjects in another bill (SB 410) and overall district fiscal constraints, but no broad stakeholder opposition to SB 423 was recorded during the hearing.

Closing: Presenters urged the committee to support creating a predictable, flexible funding stream for FPHS to stabilize local public health infrastructure and preserve capacity to draw down federal funds in the future.