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March 28, 2015

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Is Sandoval more likely to address tax reform in a second term?

A sense is developing in Carson City that lawmakers will hold the line on the budget this session, opting for a tax reform discussion now but delaying any real action for two years.

What’s so special about 2015?

Gov. Brian Sandoval, a moderate governor who has extended but not raised taxes, would be in his second and final term — assuming he wins re-election in a year that is unlikely to bring him a significant opponent.

Indeed, many have likened Sandoval to former Gov. Kenny Guinn, a moderate Republican who cared deeply about education and pursued the most ambitious tax increase in decades in his second term.

Like Guinn, Sandoval is a moderate Republican. He cares deeply about education. And, as some are quick to point out, he has the same team of close advisers as Guinn, including Reno politicos Pete Ernaut and Greg Ferraro, who have helped Sandoval cultivate an image as a pragmatist rather than an ideologue.

“Some think (it) would be more likely with a Republican governor, hopefully, in his second session,” Assemblyman Pat Hickey, R-Reno, said recently about a potential discussion on taxes. “He might be more likely in his second term than he would in his first. I don’t think historically any governor, much less a Republican, supported a significant tax increase in his first term.”

Sen. Debbie Smith, D-Sparks, said she also has encountered the comparison of Sandoval to Guinn.

One former state official said he would expect the governor to attack the issue of tax reform — though maybe not a tax increase — in a second term.

“He knows the tax structure doesn’t work,” the former official said.

But in a recent editorial board meeting with the Sun, Sandoval expressed surprise at the question.

“Who’s saying that?” he asked. “I have not (heard it.)”

Sandoval refused to say equivocally whether it’s a misperception.

“I am going to continue doing what I’m doing right now,” Sandoval said. “I’ve been an opponent of increasing taxes in the state. I don’t think it’s good for business and I think as time moves on, you will continue to see our state grow out of this.”

Others point out important differences between Guinn and Sandoval. Guinn was in his late 60s in his second term as governor — his first and only elected position — with no designs on higher office.

Sandoval is 49. This is his third elected office and many consider him a possible U.S. Senate contender. A tax increase could make a run for higher office more difficult.

Also, Sandoval hasn’t exactly primed the discussion for a debate on the tax structure.

Quite the opposite, in fact.

“Our tax system is working,” Sandoval said in explaining his belief that increased economic growth and diversification will take care of the state’s budget problems.

Pressed on that point, Sandoval deflected to what others have proposed so far.

“I believe it’s working right now,” Sandoval said. “Can it be improved? Let’s see it. I’m just as interested as anybody else. But when you get down to it, it comes down to some type of corporate income tax or services tax. I haven’t heard of anything other than that.”

And instead of proposing his own tax reform approach, Sandoval said he is focused on economic development.

“That is part of this economic diversification so that we’re not so reliant on gaming and tourism,” Sandoval said.

Sandoval also said he will ask lawmakers this session to lower the payroll tax rate on all Nevada businesses.

With that kind of rhetoric from Sandoval, Democrats don’t seem content to simply push the debate to a potential second term.

“He’s talking about lowering taxes this session,” Smith said. “That doesn’t make me think that (tax reform) would be on the agenda next time. I just hope we can all make decisions based on what’s right for the state, not the next election.”

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  1. Sadly as it seems, all career politicians base their agendas on re-election. This is a BAD way to run government, a state, a country.

    During this holiday season, many of the party conversations are turning to Nevada tax reform/restructuring. The Citizens of this state realize the need, but it is too inconvenient for our Lawmakers.

    Not lost on the People of Nevada, is the disparity of being on the losing end when the mining wealth of Nevada is extracted and taken from the state and mining pays a pittance for it. Lawmakers need to close exemption loopholes and equalize the taxing of mining to at least the financial average of what they are paying in the rest of the 49 states of this country. This can only be done by our Lawmakers, and by changing the Nevada Constitution (which mining interests had a hand in writing over a century ago).

    Before imposing higher taxes on Citizens and small businesses, our Lawmakers really need to take a historic look at the Mining and Gaming/Resort industries, who have had record profits year after year. That is pretty telling.

    Blessings and Peace,

  2. Sandoval is a career politician shooting for higher office. In his entire time in office he has done exactly, to the letter, what every other politician, except for the late governor Guinn, has done. Sandoval is NO Guinn.
    The status quo: no tax reform, no diversification.

  3. Anjeanette: could you consider doing some research for a somewhat-related story? We have so many more people, Nevada population has increased in the last 20 years or so--since the last lasting tax legislation. Now we seem to have a much larger percentage of the population in K-12 age range (due in large part from large illegal families) and we seem to have much larger portions of the local populations on various forms of local, state, federal, non-profit assistance programs. Certainly an economy, a state-wide economy, cannot maintain funding levels when the number of beneficiaries explodes. This doesn't mean we've had any real economic growth. But, it certainly doesn't leave funding available to increase the compensation of higher-ed where Profs keep claiming they are improving things for all of us.

  4. In response to Commenter SmartOne618 who stated, ""Timing" is important in all of our lives... why would we think it should be any different for our representatives? The divisiveness that exists in our state, and our country for that matter, makes timing all the more relevant.

    This is a solid administration led by Governor Sandoval and these issues ultimately will be tackled, but as in life, "timing" is everything."

    When is the "right time"??? When the soil of Nevada has been depleted of every valuable mineral and there is NO MORE? When the price of precious metals drop, so Lawmakers need not bother with addressing the laws? When all the stars and constellations are in alignment and are favorable?

    Nevada has been EXPLOITED and has suffered enough. The infrastructure requires appropriate funding, and our state needs to enact a near zero growth policy until we have the water, power, jobs, and education to meet the needs of the current and future population. We simply cannot wait for the perfect "timing" any longer.

    Blessings and Peace,

  5. Smartone: You MISS the point. We have too many per capitas and too few PRODUCTIVE workers. We keep importing illegals, large families, indigents without the economy to support it. And, you'd attack the economy even more with tax increases?