Sam Morris / Las Vegas Sun
Sunday, Aug. 7, 2011 | 2 a.m.
Business and labor leaders are talking about forming a pro-tax coalition, saying they are frustrated by lawmakers’ inability to change the state’s revenue structure during its biennial 120-day effort at policymaking.
Nevada Resort Association lobbyist and Democratic power broker Billy Vassiliadis said “some semblance of a broad coalition” will come together in the next 60 days. Its goals will “depend on what the broadest number of people want to do. Poll after poll show the public doesn’t want to see more cuts in education,” he said. The coalition will have to figure out what people will support.
In the post-session disappointment of 2011, labor unions and many large-business leaders, particularly from gaming and mining, declared Nevada’s legislative system broken. Getting two-thirds of lawmakers in both the Assembly and Senate, as required under the state’s constitution, to raise taxes was simply too high a hurdle given Nevada’s fractious politics.
Gaming and mining have long advocated for a broad-based business tax, prompting some segments of the larger business community to push back.
“There’s been no decision made by the NRA if and what (it would) support,” Vassiliadis said. “I think there are discussions happening in board rooms and union halls all over the state.”
Leaders from the AFL-CIO, the state’s largest union; the Nevada State Education Association, which represents teachers; and gaming and other industries have been meeting to discuss what would work, according to sources. Discussions have focused on a “margins tax” on businesses — a tax on adjusted gross business revenue — similar to what was proposed in 2011 by Democrats to replace the tax based on payroll.
It is unclear how much money the coalition would hope to raise through new taxes, or what type of ballot measure would be used. Experts say there are a number of paths to raise taxes, none of which would spare lawmakers in 2013 from making some kind of decision.
• Change the constitution: It would take two consecutive votes of the people, in 2012 and 2014. It would not be implemented until 2015.
• A statutory initiative: This would require supporters to collect signatures for a proposed law. If successful, the 2013 Legislature would have 40 days to pass the bill, or decide on an alternative. If they didn’t, it would go to a vote in 2014.
• An advisory question, which would not be binding.
That means the next time lawmakers meet to pass a budget, they will once again face the loss of hundreds of millions of dollars in revenue because of taxes that will expire if they don’t take action, likely resulting in a giant deficit.
Democrats were unable to do more than extend existing taxes for another two years. When that became clear, Danny Thompson, head of the AFL-CIO, said during the session that he felt a tax written into the constitution would be necessary. He declined to comment for this story, saying the timing wasn’t right.
Officials close to the Las Vegas Chamber of Commerce and Nevada Retail Association, a more conservative business lobby, said they had not been approached about a potential ballot measure, even though they expected one to come.
A possible fracture in the business community might be the biggest hurdle.
One lobbyist associated with business said if business leaders can’t agree on the coalition’s tax initiative, there could be competing measures to try to defeat it.
“The best way to kill that would be an initiative specifically targeting gaming and mining,” the lobbyist noted, speaking frankly in exchange for anonymity.
Attacking the state’s two largest and best-funded industries? That would be a fight reminiscent of the 2003 tax battle, but this time fought at the ballot box.