Las Vegas Sun

March 28, 2024

At special session, Democrats work to raise taxes on mining

Assembly

David Calvert / Nevada Independent via AP

The Assembly chamber is seen Friday, July 31, 2020 during the first day of the 32nd Special Session of the Legislature in Carson City. Gov. Steve Sisolak convened the Nevada Legislature on Friday for a special session to address policy issues related to the coronavirus pandemic and Black Lives Matter protests that swept Nevada and the nation in May and June.

CARSON CITY — Democratic lawmakers are making another push at raising mining taxes weeks after two failed attempts on party-line votes in the last special session of the Nevada Legislature.

Senate and Assembly Democrats on Friday during the opening day of a second special session brought forward two joint resolutions — one in each chamber — that would increase the constitutional tax cap on mining from 5% of gross proceeds to 7.75% of gross proceeds.

The difference?

In the Assembly, 25% of the funds would have to go toward education, health care or economic assistance for Nevadans. In the Senate, 50% of the monies would go into a fund in the state treasury to pay directly to eligible Nevadans. The details of that eligibility are not defined in the resolution and would need to be established by the Legislature.

Under both of the resolutions, the remaining money — 75% in the Assembly and 50% in the Senate — would not be constitutionally pledged to any other source and could be used to supplement the state budget.

Direct payments to state residents from an industry is not a new concept. Alaska has the Alaska Permanent Fund, which sends money to citizens annually from a portion of oil industry revenue.

A constitutional amendment is needed to change the tax cap in the state constitution. To accomplish this, the measure would need to pass in consecutive sessions of the Legislature and then go to the people for a vote.

That means lawmakers would need to approve the resolutions in this special session and then again in the 2021 regular session to be placed on the ballot as early as 2022. Cheryl Bruce, the spokesperson for Senate Democrats, said that both options are planned to be on the table for the next session, which will give legislators options.

“Proposing two amendments will give lawmakers time to continue conversations with stakeholders and hear from their constituents,” she said in a text.

In a statement issued by Senate Republicans, Sen. Pete Goicoechea, R-Eureka, said the proposal would “kill small mines throughout Nevada.”

If lawmakers are going to pass either resolution, they’ll need to do so quickly. State statute dictates that amendments to the constitution need to pass no less than 90 days before the next election, meaning action would be required over the weekend.

The next election is Nov. 3, and, if the resolutions pass, lawmakers elected in November will have the ability to take up either resolution for a second passage in the next regular session.

Typically, a resolution involving an amendment would require hearings on three legislative days, although lawmakers are working on a bill that would speed up the process. If passed, the bill would allow the entire process to be done in one day.

“These rule changes cast aside the standards of legislative process that have been in place since statehood because the majority party can’t be bothered to respect the traditions of the Nevada Senate,” Senate Minority Leader James Settelmeyer, R-Gardnerville, said in a statement.

The debate over mining taxes came to a head during the last special session, albeit in a different form.

During the last few days of the session, Democrats brought forward a bill that would have put a 60% cap on deductions for mining taxes. Though it passed the Assembly, Senate Republicans did not back the bill on its first vote, and an attempt by Senate Democrats to revive the bill by earmarking funding for education failed after Republican Sen. Keith Pickard, R-Henderson, backed away from supporting it.