Thursday, June 5, 2003 | 11:08 a.m.
CARSON CITY -- The Assembly and Senate are so far apart on a solution to the state budget crisis that observers believe the two houses will be unable to meet tomorrow's deadline.
"This is just a philosophical train wreck," Assembly Minority Leader Lynn Hettrick, R-Gardnerville, said Wednesday, the second day of the special session.
While an Assembly panel was still discussing potential exemptions to the unified business tax, the entire Senate overwhelmingly raised hands in opposition to any idea similar to the UBT that taxes a business's gross receipts.
And as the Senate worked on controls to guarantee school funding is correctly spent, the Assembly tinkered with the federal school accountability act, No Child Left Behind, in ways the upper house leader Bill Raggio, R-Reno, finds untenable.
"I'll see you in August," one veteran lobbyist remarked to another in the hallway as the 19th special session plodded on without consensus.
The Legislature has a Friday deadline to finish a plan to fund the state government.
The differences are so key that it could be disaster and bring about the 20th special session.
"If the Assembly is committed to the UBT, we will remain deadlocked." Senate Minority Leader Dina Titus, D-Las Vegas, said.
Assembly Speaker Richard Perkins, D-Henderson, said "The UBT has broad support and was only one vote short in each house. I think it's irresponsible to take something like that off the table."
This morning the Assembly voted to support the unified business tax.
The only business tax that remains on the table between the two houses is a net profits tax.
The Department of Taxation this morning issued a report on a net profits tax, stating it could not be implemented until Jan. 1, 2005.
"Implementing a business income tax is truly a complex and substantial task that deserves necessary time for developing and providing comprehensive guidance to our taxpayers and to training and preparing the department," Taxation Department Director Chuck Chinook said.
The Senate Committee of the Whole approved further discussion of the tax by a 14-7 vote -- exactly the two-thirds majority required in that house for approval of a tax plan.
A majority of the Assembly Select Committee on Education Funding and State Revenue this morning also approved further discussion of the net profits tax.
The change is dramatic because the Legislature had almost agreed on a plan before the session ended Monday.
When Gov. Kenny Guinn on Tuesday ordered lawmakers back to work it was just hours after they had failed to take a vote on a tax package to provide the $860 million in new revenue needed to balance the nearly $5 billion budget.
At Monday night's adjournment of the 72nd regular session, Senate and Assembly leaders each proclaimed their house was just one vote shy of the two-thirds majority needed for passage of a tax plan that included the UBT.
Guinn set the parameters of the special session as such that lawmakers will not get to reopen the budget as Assembly Republicans want. The only budget available for consideration in the special session is the nearly $2 billion plan to fund K-12 education.
For emphasis, Guinn on Wednesday signed the second of two bills that spend the state's money -- the appropriations and authorizations acts. The move further stresses the call for $860 million in new revenue -- money that lawmakers must approve by the end of the fiscal year June 30.
Assemblyman Rod Sherer, R-Pahrump, is one of three rural freshman Republicans eyed as potential swing votes for taxes. But Sherer, Pete Goicoechea of Eureka and Tom Grady of Yerington, are still not convinced that the state needs $860 million.
"I told the governor and the speaker I'll come to the table if there's a table to come to," Sherer said.
Four Republicans did join the 23 Assembly Democrats in pledging support for the tax plan Monday. Sherer and Goicoechea were each touted as the potential last vote to get the tax plan passed.
But any near vote in the Senate that was reported by legislative leaders and lobbyists appeared nowhere to be found Wednesday.
By a display of hands the Senate showed just how few people wanted to consider the hallmark tax of Senate Bill 509 from Monday night. More than two-thirds of the house raised hands to show they were opposed to continued discussion of a gross receipts tax.
A business tax on net profits got exactly 14 hands -- a two-thirds majority in that house -- in support Wednesday, showing that variation of a broad-based business tax was alive, but barely.
Wednesday's sessions of the 21-member Senate acting as a committee of the whole and a 19-member Assembly select committee, seemed to take lawmakers back to Day 1 of the regular session, not the 122nd legislative day the special session had forced them into.
In the Assembly, lawmakers retraced how schools are funded for the benefit of committee members who don't serve on Ways and Means.
Sharron Angle, R-Reno, asked numerous questions, not just about the funding, but about accountability and seemingly unrelated topics.
"On the English Language Learners, do we still require a birth certificate when they come into school?" Angle asked.
After getting an answer that children can register with a variety of documents, Angle asked, almost stunned: "We don't know about citizenship at all?"
Select Committee co-chair Morse Arberry, D-Las Vegas, stopped her questioning saying: "I've got to reel you in. That's a little much."
Shortly after, the 19-member committee voted 18-1 to pass the nearly $2 billion Distributive School Account budget and class-size reduction measures -- with a $400,000 savings that changed the way the Senate had voted on accountability and class-size reduction.
Hettrick opposed the motion saying that he wasn't against education, but rather was philosophically opposed to the amount of new revenue earmarked for spending.
He also questioned rankings that show Nevada as the 46th state for per-pupil funding saying such statistics don't consider variables that rank the state higher.
Perkins disagreed, saying: "I do think we've done a terrible job in funding education."
Senators spent the afternoon and early evening gauging support for a variety of taxes. The one clear sign to the Assembly meeting four floors above was that any form of gross receipts is off the table, and that alternately payroll taxes and sales taxes are still open for discussion.
Perkins said Tuesday the payroll tax is not broad-based and would not pass his house. Guinn has said he would veto a sales tax on services, unless the tax applied only to services businesses predominantly use.
Raggio began going through a list of potential taxes to determine two-thirds support from his house, he started with reduction of the cigarette stamp fee -- the allowance retailers get for collecting the cigarette taxes for the state. None of the senators were in opposition.
"See how easy this is," Raggio remarked.
archive
