The expectations for the 2015 session of the Nevada Legislature were exceedingly low, but, by jove, they spectacularly exceeded the lowest expectations and gave a new definition of the word “nadir.”
Not only did they raise taxes and basically create a Nevada version of the IRS with a “commerce tax” that smells suspiciously like a margin tax defeated by the voters just months before, but they threw money at an education bureaucracy without requiring any significant accountability and did almost nothing to rein in the burgeoning costs of government. Reform was a dirty word that none dare spake.
They even had the audacity to take back in the waning minutes of the session one of the few cost-saving measures that had passed early in the session. In March lawmakers, over the objections of union-beholding Democrats, voted to end the requirement that contractors for construction of public schools and university buildings pay workers the so-called prevailing wage.
The prevailing wage is set by the state labor commissioner from a survey of contractors. It is so time consuming that in reality only union shops bother to comply, meaning the prevailing wage is the highest union wage.
Studies of the cost of the prevailing wage law have shown it adds anywhere from 5 to 40 percent to the cost of public works in Nevada.
But, using the base canard that they had to jettison the prevailing wage curtailment in order to get Democrats to vote for Gov. Brian Sandoval’s historic high $1.5 billion in tax hikes — like when could they stop a Democrat from voting for higher taxes? — the Republicans recanted and voted to require school and university projects to pay 90 percent of the prevailing wage.
Adding insult to injury, this same group of 63 lawmakers also extended an estimated $4 billion in public school bonds beyond what voters had approved. Now the voters will be paying for more schools but getting fewer of them for their tax dollars.
When you add the $1.5 billion per biennium general fund spending increase to the school bond rollover over the next decade that taps every household budget in Nevada for more than $1,100 a year to give to government instead of pay the rent. And that assumes no more tax hikes in the next 10 years — a most unlikely assumption. This means the percent of state GDP going to government will increase and money available for business-growing investment will decrease.
The taxes will raise not nearly what is projected and the money will already be spent, so be ready for the upward spiral to continue — or downward spiral in terms of disposable income for private sector workers and retirees on fixed incomes. Businesses don’t pay taxes. Households do. This is pure redistributionism.
Our benevolent lawmakers also doled out 3 percent-plus pay raises to all state workers regardless of merit.
They also repealed a law that would have reduced the state Supreme Court from seven members to five at a cost of $500,000 a year. Saved two jobs, though.
A bill to reform public employee pensions was put off till next session, by when the unfunded liability will have grown even higher. The bill would have maintained a smaller defined benefit along with a defined contribution plan that would be similar to a 401(k) type plan used in the private sector, and would have began trimming the pension plan’s $40 billion unfunded liability.
A bill to allow local governments to drop collective bargaining was starved to death.
Lawmakers couldn’t even pass a campus carry bill.
Among the few collective bargaining changes was to not allow school administrators making more than $120,000 a year to join unions. Another requires unions to reimburse the taxpayers for the time union officials spend on union business, but allows unions to give up something comparable during negotiations. What a loophole — they just say they gave in on even higher raises.
It was all take and no give.
Of course, 10 years from now we will be able to look back and determine finally that all the additional education funding did nothing whatsoever to improve education, any more than the huge increases over the past decades have. What do they call doing the same thing over and over again and expecting a different outcome?
A version of this column appears this week in the Battle Born Media newspapers — The Ely Times, the Mesquite Local News, the Mineral County Independent-News, the Eureka Sentinel, the Lincoln County Record and the Sparks Tribune — and the Elko Daily Free Press.