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August 21, 2014

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Going after mining tax, despite the Harry Reid factor

Harry Reid

Harry Reid

Beyond the Sun

Maybe all Nevada Democratic politics aren’t about Senate Majority Leader Harry Reid’s re-election after all.

The Progressive Leadership Alliance of Nevada plans to try to amend the Nevada Constitution to force an increase in the tax on mining rather than banking on legislative action in 2011.

Liberals have long complained that Nevada’s mining industry does not pay enough in state taxes. With gold prices soaring while the rest of the economy craters, the calls for mining to pay more have gotten louder.

As PLAN had been gearing up last month to pursue a constitutional change to make that happen, the idea ran into what seemed to be the immovable object of Democratic politics: Reid’s re-election. The concern was that a mining tax initiative on the November ballot would hurt Reid’s chances by drawing anti-tax, rural voters to the polls.

So PLAN’s board of directors decided to seek mining tax changes in the 2011 Legislature, even though that would have left the proposal subject to more than a year of political pressure from the powerful mining industry.

PLAN is to announce Tuesday, however, that it is returning to its effort to collect 97,000 signatures to allow voters to decide in November whether the state should tax “gross” mining revenue instead of just “net” revenue.

So why did PLAN revert to its original plan? Bob Fulkerson, the group’s executive director, said his board held another vote.

“We don’t think it’ll hurt anybody, Democrats or Republicans,” Fulkerson said. “Frankly, we’re just going to do it.”

Some Reid supporters disagree.

“Usually it’s not smart to turn out people who aren’t friendly to your side,” said Billy Vassiliadis, a Democratic kingmaker and adviser to Reid.

Vassiliadis’ advertising and lobbying firm also represents the mining industry.

Asked why he believed PLAN is trying to get on the November ballot, Vassiliadis gave two scenarios: “To give them the best of it, maybe it was triggered by increasingly negative state revenue news. To present the more cynical view, they’re looking for relevance and attention.”

Fulkerson argues that having the measure on the ballot will give the Democratic base another reason to go to the polls, in a cycle that has historically belonged to the opposition party.

He acknowledged that some of the groups that sit on his board, including labor and environmental groups, abstained from voting. But, he said, “We were able to convince them not to block this going forward.”

Liberals have long maintained that the only way to enact lasting change is through the constitution, though such a change would have to be approved in 2010 and 2012 before it could become law in 2013.

To help Reid — or at least in an attempt to anticipate what people thought Reid wanted — many thought PLAN would keep it off November’s ballot. But the news, broken by Las Vegas Sun columnist Jon Ralston on Thursday night, caught many atop Nevada’s Democratic power structure off guard. And they were not pleased.

“Nobody really wants us to do this,” Fulkerson said. “Mining has a lock on the state’s political structure. The power of the mining industry pervades Democrats, Republicans, established organizations. But we think there’s a grass-roots constituency out there that wants to see it happen. We’re going to throw our dice.”

An industry, it seems, has grown around trying to anticipate what Nevada’s most powerful politician wants or feels. But what does Reid himself think?

Reid spokesman Jon Summers had an interesting answer: “Without seeing any proposed language, we can’t give a position. But Sen. Reid believes any effort to increase royalties should be balanced with greater certainty for our mining families and mining towns.”

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