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July 25, 2014

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Lawsuit seeks to stop circulation of margins tax initiative petition

CARSON CITY – An organization supported by banks, car dealers, farmers, truckers and a Las Vegas Strip casino has filed suit to block circulation of an initiative petition to impose a 2 percent margins tax on Nevada businesses.

But a spokesman for the petition says the suit was no surprise “and we are confident they will not be successful.”

The suit by the Committee to Protect Nevada Jobs said the petition was “materially misleading” and “fails to inform the voters of the effects and consequences.”

The Nevada State Education Association, an organization of teachers, and the Nevada State AFL-CIO are behind the effort to raise more money for Nevada’s public schools.

Dan Hart, a spokesman for the education association, said the lawsuit was just another tactic to delay circulation of the petition “as much as possible.”

“We expect the court will validate our petition and we can go forward,” said Hart.

Backers of the tax initiative need to gather 72,352 signatures of registered voters to present it to the 2013 Legislature. If the Legislature rejects the initiatve, it would go on the election ballot in 2014.

Josh Hicks, attorney for Committee to Protect Nevada Jobs, said the petition mentions education once in its 26 pages and makes no provision for raising public school support “by even one penny.”

He said the petition even allowed for a decrease in classroom funding and that would be an “unpleasant surprise to those who sign it.”

According to the suit, the petition does not tell the voters the required details in the required 200 words. And, the suit contends, the petition illegally contains more than one subject.

The suit has the support of the Las Vegas Sands Corp., Las Vegas Chamber of Commerce, Retail Association of Nevada, Nevada Bankers Association, Nevada Franchised Auto Dealers Association and Nevada Trucking Association.

Supporters of the initiative say it would exempt those businesses that earn less than $1 million a year – protecting small companies. Opponents said the provisions of the tax would hit most independently owned gas stations, medical clinics, ranches and farms. And, they say, it would hurt businesses struggling to make a profit.

The 2 percent modified business tax now paid by financial institutions would temporarily be raised to 2.24 percent to support the state Taxation Department in collecting the tax.

The suit says the initiative petition is unconstitutional and invalid and it asks the First District Court in Carson City to stop the petition’s circulation.

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  1. Classroom funding and the quality of education received by students are not one in the same and are not directly proportional.

  2. This only makes it more difficult to do business in Nevada and increases the advantage to the-out-of state cheaters who pay no sales or use tax now.
    Enforce the existing laws first!

  3. They should have honestly named their organization "Committee to Protect Nevada's Corporate Elite Bonuses"

    Dear Joan Respondi,
    You are WRONG!! Education funding and quality of education ARE linked.

    In "When money matters: How educational expenditures improve student performance and how they don't."
    (an actual statistical analysis, rather than just an uninformed opinion)
    *Funding allocations to create/preserve a lower teacher-student ratio was found to affect student performance.
    *The benefit of a low ratio promotes social cohesion, teachers can be more attentive, higher morale, maintain order and discipline, and forge better relationships with students.

    Further, in
    "Resources allocation practices and student achievement: An examination of district expenditures by performance level with interviews from twenty-one districts."
    *Top performing schools consistently spent more per-pupil than intermediate or low performing school on instruction, instructional resources, school leadership, general administration, co-curricular activities, and total operating expenditures.
    *Top performing schools consistently spend significantly more per-pupil than intermediate or low performing school in regular education and career & technology education.

    To summarize: Hire/retain teachers with experience. Hire/retain good district level administrators and strong, committed finance directors (foster a team approach). Create/preserve low teacher to student ratios (for various reasons). CCSD doesn't focus on any of these and can't because they don't have the resources. Why? Politics and uninformed voters.
    ALL of these cost money and directly correlate to spending.