Teachers win round for business tax petition

Wednesday, Dec. 6, 2000 | 11:16 a.m.

CARSON CITY -- The schoolteachers' union has won the opening round in the legal battle over its plan to impose a 4 percent business profits tax to raise anywhere from $200 million to $270 million a year for education.

But the issue is going to the Nevada Supreme Court.

District Judge Mike Griffin of Carson City on Tuesday dismissed the suit by chambers of commerce and some businesses that challenged the constitutionality of the initiative petition of the Nevada State Education Association.

Ken Lange, executive director of the education association, said, "This is the strongest ruling the judge could have made, given the hearing. We're very confident this allows us to go forward into the Legislature with our best foot forward."

But Kami Dempsey, the executive director of a coalition of chambers to defeat the tax, said the Griffin decision would be appealed to the Supreme Court. She said she was "somewhat surprised" that Griffin failed to find the tax unconstitutional because it could be levied against individuals, which is barred by the Nevada Constitution.

The union gathered more than 60,000 signatures of registered voters on a petition to amend the law to impose the tax on profits above $50,000 earned by businesses.

Judge Griffin, in his 24-page decision, said he had "serious reservations about some of the provisions of this petition passing constitutional muster." He referred to a section in the initiative petition that required the state to allocate at least 50 percent of its budget to kindergarten through high school.

At present the state appropriates anywhere from 35 to 41 percent to the public schools. The chambers of commerce say the petition would require the state to boost that to 50 percent, and then the new tax dollars would be added to that.

That would require millions of extra dollars going into education and leave a huge gap in the state's finances, critics say.