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August 31, 2015

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Nevada Democrats still afraid of the ‘T-word’

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Sam Morris / Las Vegas Sun

Assemblywoman Debbie Smith asks a question during a meeting of the Assembly Ways and Means Committee on the second day of the 2011 legislative session Tuesday, February 8, 2011 in Carson City. Smith is the incoming chairwoman of the Senate Finance Committee for the 2013 legislative session.

Nothing trips up Nevada’s Democratic lawmakers more than asking the simple question of whether they support raising taxes.

“My bottom-line goal on the revenue portion is to have a full discussion about it,” said Senate Majority Leader Mo Denis, D-Las Vegas.

“There’s not an easy answer,” said Assembly Speaker-elect Marilyn Kirkpatrick, D-North Las Vegas. “There’s not a yes-or-no answer to that question.”

“I can’t answer that,” said Sen. Debbie Smith, D-Sparks, the incoming chairwoman of the Senate Finance Committee. “I think we need to have a tax discussion. I think there’s common agreement we need to look at our tax structure.”

Less than a month before the Legislature meets, Democratic leaders are once again approaching the tax issue cautiously, creating a mushy contour for a tax debate that has stretched more than a decade. It also suggests the 2013 legislative session on taxes will be dictated largely by the policies set by Republican Gov. Brian Sandoval.

Sandoval has been clear on taxes. He will extend some or all of the 2009 temporary tax increase — worth about $620 million for the state. But he won’t support any further tax increase. It’s a position echoed by many Republican lawmakers.

Democrats, meanwhile, say they want to extend the full 2009 tax increase. But in interviews with the Sun, they hedged on whether they would seek to increase taxes beyond that, even as they suggested the state wasn't spending enough on education.

But they do promise a “frank discussion” about taxes, spending and the direction of the state.

Click to enlarge photo

Sen. Mo Denis asks a question during a meeting of the Senate Finance Committee on the second day of the 2011 legislative session Tuesday, Feb. 8, 2011, in Carson City.

“Everything is on the table,” Denis said. “I’m not going into session thinking we need to raise taxes this session, especially with the economy the way it is. Going into the session, we’re going to discuss revenue, to see if it’s adequate for Nevada.”

Kirkpatrick said the state first needs to “clean up” its tax structure — weeding out exemptions and possibly broadening the structure.

She said there would be no last-minute tax plans without time for proper vetting — a characteristic of Democratic proposals in 2009 and 2011.

But she wouldn’t directly answer the question: “Do you support a tax increase?”

“We’ll be having the discussion early,” she said in response.

But talk is just that: talk.

“There’s no leadership of an effort to raise taxes this session,” said Mike Sloan, a gaming lobbyist and veteran of the 2003 tax fight with late former Gov. Kenny Guinn. “I do think there’s a recognition that we have unmet needs.”

But the left wing of the Democratic coalition is frustrated.

“They’re saying, ‘Why fall on our swords if it won’t go anywhere anyway?’” said Bob Fulkerson, executive director of the Progressive Leadership Alliance of Nevada. “The problem with that is you don’t move the ball further ahead. We have these dysfunctional discussions.”

In 2009 and 2011, Democratic leaders hid their tax proposals until the final days of the legislative sessions. In 2009, the tax plan wasn’t introduced until the final weeks of session, when one Senate tax hearing was held at midnight. In 2011, Democratic leadership waited until about a month before session ended to reveal a gross business tax.

In 2009, lawmakers succeeded in passing an increase of existing taxes over the veto of Gov. Jim Gibbons. In 2011, though, the Democrats’ new tax proposal went nowhere.

Instead, that tax plan, known as the margin tax, was taken up as an initiative petition by the state teachers union, the Nevada State Education Association. If the teachers win a challenge now before the Nevada Supreme Court, lawmakers will have to consider the tax within the first 40 days of the 2013 session.

That, Fulkerson said, could force the discussion about higher taxes.

“The margin tax will be like a nuclear bomb dropped on the front step of the Legislature,” he said.

After all, if a tax is up for a vote before the Legislature, lawmakers have to push a red or green button. And that’s as clear an answer as they can give.

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