Published Tuesday, March 13, 2012 | 12:39 p.m.
Updated Tuesday, March 13, 2012 | 5:01 p.m.
Gov. Brian Sandoval said today he will propose continuing the 2009 tax increase to avoid further cutting education and other services when he builds his budget for the next biennium.
Sandoval’s stance is in sharp contrast to his budget approach two years ago, when he vowed he would allow the 2009 tax increase to expire as planned.
Sandoval ultimately included that revenue when a Nevada Supreme Court decision threw into question more than $600 million in local government funds he had planned to use to plug the budget hole.
But Sandoval said he doesn’t view the extension of the sunsets as a tax increase.
“Let me be clear, as I’ve said before, the economy is improving, but I believe we must begin this budgeting process with all the information available,” Sandoval said in a written statement. “In addition to avoiding further cuts to education, this decision means there will be no need for tax increases in the next session. Nevadans will pay no more than they are in the current biennium.”
Sandoval said the revenue, from increased payroll, sales and car registration taxes, as well as an increased business license fee will be needed to meet increasing budget demands, blaming federal mandates the state must meet.
“While taking into account mandatory caseload growth, primarily in Health and Human Services, federal mandates such as the Affordable Care Act, and critical infrastructure needs, my budget instructions will call for “flat” budgets which will rely on some or all of the revenue from the sun setting taxes,” he said.
State Sen. Michael Roberson, R-Henderson, who is in angling to be the party's leader in the state Senate, said he supports Sandoval's plan. He issued a statement saying he was "grateful for his (Sandoval's) tremendous leadership. I will stand with him and support him."
It's a reversal from December, when Roberson said he did not favor extending the taxes. "We need to find to figure out a way to do that (let the taxes expire) while preserving funding for K-12, higher education, health and human services, all important public services that the government provides," he said at the time.
Sandoval said he will ask the Legislature to allow state agencies to have more flexibility in how to spend appropriated money. He said didn't know what the response from legislators would be.
Senate Democrats attempted to answer that question, issuing a statement saying Sandoval would be "clinging to stagnant levels of education funding" while failing to work on the long-term problems of school funding and tax reform.
"In order to diversify our economy and attract new businesses and industry to Nevada, we must show them we are serious about investing in a well-educated work force," said state Sen. Mo Denis, D-Las Vegas, who is in line to lead the Senate Democrats. "We can't do that if education funding remains stagnant. We must address tax fairness for middle-class families, cut wasteful spending in our government, and provide Nevada business with an educated workforce that can help compete in the national and global marketplace."
Sun writer Cy Ryan contributed to this story.