Sandoval reflects on budget deal, legislative session

By Anjeanette Damon

Friday, July 15, 2011 | 2 a.m.

In his first legislative session as governor, Brian Sandoval ushered through a spending plan that fixed a historic revenue deficit. But to accomplish that he had to reverse himself on his promise not to extend tax increases passed in 2009 and scheduled to expire last month.

In one of his first extended interviews since the end of the combative session, Sandoval reflected on the fallout from that decision, explained his veto of a controversial energy bill that was the top priority of his political advisers — who also lobby for NV Energy — and hinted at plans to endorse a candidate in the upcoming Republican presidential primary.

What follows are excerpts from the interview — edited for space and clarity — which will air in its entirety Saturday at 6:30 p.m. on KSNV Channel 3 in Las Vegas and on KRNV Channel 4 in Reno.

You said in countless voter forums that raising taxes — and in that you included in that extending the 2009 tax increases — would be the worst thing you could do in this economy. Were you right? Have you crippled the economic recovery in this state?

Well, that’s an interesting way to put it. You’ve left a big piece of it out and that is the Nevada Supreme Court decision on the Clean Water Coalition case, which in my mind called into question over $600 million in budgeting decisions that had been made in the previous administration. So, I didn’t want to leave the state of Nevada exposed to perhaps a $600 million issue in the near future and, in fact, that’s what’s happening now. Clark and Washoe counties are seeking a refund in taxes from this state.

What is the impact on the economy? You said time and again this would halt the economic recovery … Is that going to come to pass?

We provided a tax cut for 70 percent of Nevada’s businesses. Small business is the heart and soul of our economy and I thought that was a tremendous achievement to cut taxes for those businesses.

When you go before voters who believed you, took you at your word you would not extend those taxes … Are they accepting that argument from you? Some of them are still saying you broke your promise.

Some of them are. But they all understand what is in the best interest of the state. Most of the feedback I’ve gotten has been extremely positive and they admired what we were able to achieve in a short period of time.

I want to turn to one of the more surprising vetoes — a bill that was NV Energy’s top priority that would have allowed them to go to ratepayers to recoup the costs for a transmission line to export renewable energy from Nevada to California. It was a surprising veto in many ways, not the least of which is that their top two lobbyists are two of your closest political advisers. Why did you veto that bill?

I was a federal judge. So what I did was look at all the facts. So the personalities really weren’t relevant when I made a decision to veto that bill. There was a lot of information, a lot of people lobbying for and against the bill. There are pieces of that bill that were extremely important with respect to renewable energy. But at the end of the day, I didn’t believe it was good public policy.

This bill was introduced at 12:30 at night, the last day of the session. It was passed without a hearing. If this bill had gone through committee hearings, would the outcome have been different on your end?

It could have been. We’re going into hypotheticals. As governor, I deal with the realities of the situation. What I was presented with was that amendment that occurred at the very end of session. I reviewed the bill and the law and decided it wasn’t good public policy.

How did that conversation go when you sat down with your top advisers, the lobbyist for NV Energy, and said “Hey, I’m going to veto your top priority here.”

It was respectful. I’ve known them since college. And they understand at the end of the day, I’m going to make decisions that are in the best interest of people of Nevada.

Was this veto a message that you’re not going to do what your old college pals say?

No. It should be a message to the people of Nevada that I treat every piece of legislation the same.

On redistricting, you and the Legislature were unable to reach an agreement. A lot of people didn’t expect you to come to an agreement on the budget and taxes either, but you did. Why didn’t you do more to come to a resolution on redistricting?

I think we did. I remember this moment very clearly: We were sitting at my conference table in my office, again, it was a good thing to resolve the budget, and I said, “Well, we have this one other outstanding issue out there.” And I encouraged the Legislature to meet again, to consider all the maps, to consider all the issues, to see if we could get it done before the end of the session. There was a very brief meeting, I wasn’t in attendance, and it’s my understanding nobody could agree to consider some of the other proposals.

There is a group of business and union leaders and liberal activists who are talking about going to the ballot for a broad-based tax increase. Is that an effort you would support?

No. I’m aware of it and I’ll be having conversations with them, I’m sure. When you talk about a broad-based business tax, that’s a pretty broad term. I don’t know what that means. But it’s not something I would be supportive of.

You’re a sought after commodity in the presidential primary. Who’s your favorite so far?

I’ve had the opportunity to speak with Ambassador (Jon) Huntsmen. I’ve met with Mitt Romney. I’ve met with Gov. (Tim) Pawlenty. They’re all great candidates. I’m not going to be making any decisions in the near future. There’s going to be a debate in Nevada in October that’s sponsored by CNN with all the Republican candidates here. I think that is a great opportunity for our state. I think it’s important for me to do my due diligence and see what each of the candidates have to say.