Editorial: Coming Legislature likely to favor tax hikes

Ramirez cartoon

“No man’s life, liberty, or property are safe while the legislature is in session,” is often attributed to Mark Twain. Though the quote is most likely apocryphal, its veracity is likely to be affirmed when Nevada’s newly elected lawmakers gather in early 2019 in Carson City.

The voters, primarily in the urban counties of Clark and Washoe, have loaded up the Legislature with Democrats — a two-thirds supermajority in the Assembly and one shy of a supermajority in the state Senate. And that seat could swing to the Democrats if a planned recount in a district in Clark County changes the outcome. The Republican candidate won the seat by a razor-thin 28 votes.

That supermajority is significant because it takes two-thirds of each wing of the legislative building to pass any tax increase. This is due to a constitutional amendment known as the Tax Restraint Initiative pushed by former Republican Gov. Jim Gibbons and approved by voters in 1994 and 1996.

Recent legislative sessions have proven that the Democrats are salivating for higher taxes to satiate their public union enablers in state and local governments and the public education system.

To add to the level of jeopardy, Nevada has elected a Democratic governor, former Clark County Commissioner Steve Sisolak, who is unlikely to wield a veto pen on any tax hikes that reach his desk. 

In an interview shortly after the election, Sisolak said, “I’ve committed, we’re not going to be raising taxes. That’s not my intent,” saying existing funds could be reallocated. But earlier in the campaign he told an interviewer, “One of the ways we’re going to have to pay for it, and people don’t want to hear it, is property taxes.” He also has a track record of backing tax increases. He was a key backer of spending tax money to build a professional football stadium in Las Vegas for a billionaire team owner.

On top of that, the lieutenant governor, who presides over the Senate and can vote in the case of a tie is Democrat Kate Marshall. Additionally, the state treasurer, controller and attorney general are all Democrats. 

One of the more likely targets will be our property taxes. Currently the state imposes a cap on annual property tax increases — 3 percent for homes and 8 percent for businesses. There has been talk of changing that, as well as eliminating or altering the depreciation on property assessments currently allowed by law. Such changes could cause property taxes to double or even triple in some cases.

Sales taxes hikes, adjustments to the Commerce Tax on businesses, as well as various fees are likely to be on the table.

Democrats are also likely to be open to proposals to allow state public employees to unionize just like local government public workers, who currently are paid 46 percent more than those in the private sector in Nevada — 57 percent more when generous retirement benefits and paid leave are accounted for. Guess who would pay for that.

There is also discussion about ending Nevada’s status as a right-to-work state, which would devastate small businesses.

Additionally, Sisolak and many of the incumbent and newly elected Democrats have expressed a desire to increase the minimum wage incrementally toward $15 and hour, which also would cripple many small businesses and drive some from the state. 

Keep your phones and your pens handy in the coming months. You’ll want to use them to let our representatives in Carson City know what we think of these potential legislative efforts.

A version of this editorial appeared this week in some of the Battle Born Media newspapers — The Ely Times, the Mesquite Local News, the Mineral County Independent-News, the Eureka Sentinel,  Sparks Tribune and the Lincoln County Record.

Democrats out to help the fat cats in certain ‘blue’ states

Of course, now that Democrats — who have made a career out of demanding soak-the-rich taxes in order to redistribute it to the poor — are in control of the U.S. House of Representatives one their first priorities will be to provide a tax break for the rich — in certain Democrat-controlled states.

According to Forbes, today’s Review-Journal editorial and others, a top priority will be a repeal of the $10,000 cap on IRS deductions for state and local taxes (SALT).

According to  the Tax Policy Center, three-quarters of the benefit of the SALT deduction goes to households making $153,000 or more. The Tax Foundation says 88 percent of the benefits flow to those making more than $100,000 a year.

So it benefits the rich, but just the rich in certain states.

Nevadans — along with residents of New Hampshire, Florida, Wyoming, Texas, South Dakota and Alaska — get to deduct about 1 percent or less of their adjusted gross income, while those who live in New York, Maryland, D.C. and California deduct more than 5 percent.

Nearly one-third of the dollars generated by the SALT cap is borne by Californians and New Yorkers, both heavily Democratic states.

Using 2010 statistical data from the IRS, you find Californians who filed for state and local income tax deductions claimed deductions of $10,700 per return. Nevadans who filed for the state and local sales tax deduction claimed only $1,430 per return.

Calculated on a per capita basis, Californians claimed $2,116 in federal income tax deductions, while Nevadans claimed only $166 per person for sales tax deductions.

Tax fairness. Not hardly.

Nevada tax burden revisited for third quarter

It turns out Nevada has a strange way of collecting its taxes.

Earlier we looked at the second quarter state and local tax collections per capita for Nevada compared to other states, and Nevada was 12th highest.

Today the third quarter state and local tax collections were reported by the Census Bureau and Nevada ranks dead last in collections on a per capita basis.

For some reason, since 2005, Nevada tax collections take a huge jump in the second quarter and nose dive in the third, as this chart demonstrates:

 

 

Newspaper column: Nevada collects more per capita in taxes than 38 states, but spends less per pupil on education than 44 states

Cowboy humorist, philosopher and rope-twirling raconteur Will Rogers once said, “It isn’t what we don’t know that gives us trouble, it’s what we know that ain’t so.”

Well, everybody knows Nevada is a low-tax state. Ask anyone. Why our very state Constitution prohibits an income tax. Sure our sales tax is pretty high but tourists contribute more to the state coffers because of it. And this is the topic of this week’s newspaper column, available online at The Ely Times, Mesquite Local News and Elko Daily Free Press.

So surely it is understandable why the state agencies are poor-mouthing as the next session of the Legislature approaches, crying that the state needs to spend $1 billion more in the next biennium to just keep up current inadequate service levels. And that doesn’t take into account the $1.2 billion in temporary taxes that are scheduled to sunset next June, leaving the shortfall at a jaw-dropping, wallet-sucking $2.2 billion.

The big fear is that new Republican majorities in both the state Senate and Assembly will balk at raising or extending taxes.

For his part, Gov. Brian Sandoval has been coy on the topic of taxation.

Asked point blank by newspaper reporters about whether his budget might include new taxes, he replied, “You’ll find out.”

He told the editorial boards of the Reno and Las Vegas newspapers, “I have a unique opportunity, I feel, hopefully as second-term governor, going into the session and having the relationships I have with the Legislature to lead this effort in terms of looking at how we fund the state.”

As for the taxes set for sunset in June, Sandoval in both 2011 and 2013 agreed to extend them.

The state’s new Republican Senate Majority Leader Michael Roberson was quoted as saying at an education forum in Las Vegas recently, “We have really two choices. We can either reform our tax structure in a broad-based, fair way in collaboration with the community … in a way that generates more revenue. Or we’re going to be in a situation where we’re going to have to cut education significantly.”

Everybody knows Nevada already is a piker when it comes to spending on education and has the results to show for it with poor test scores and graduation rates. In fact, according to the latest Census Bureau data from 2012, Nevada ranked a pathetic 45^th in the nation in K-12 education spending.

Since we’re perusing Census data already, how does Nevada stack up in that taxation department?

The most recent Census report on this is the “Quarterly Summary of State and Local Government Tax Revenue” from the second quarter of this calendar year, when Nevadans paid nearly $2.9 billion in taxes to the state, cities, counties and other taxing districts. Divide that by a population of nearly 2.8 million from the 2013 Census estimate and you find the per capita state and local taxation for the quarter was a little more than $1,000.

That was the 13^th highest per capita tax revenue in the nation — 12^th if you exclude the District of Columbia. Nevada collected more per resident than the presumptive high-tax state of New York. Thus, low-tax Nevada governments collect more per capita in taxes than 38 other states, but can’t seem to find as much to spend per pupil on education as 44 other states.

According to the Tax Foundation, Nevada’s average sales tax — state and local — is the 13^th highest in the nation.

Nevada’s property tax rate is the 28^th highest in the nation, according to Tax-Rates.org.

When you break down the revenue sources for Nevada elementary and secondary education as reported by the Census Bureau, you find Nevada ranked 47^th in federal revenue. (Tell me again about how the U.S. Senate majority leader from Nevada is bringing home the bacon.) When it came to funding levels from the state, Nevada ranked 25^th, but only 45^th for local level funding.

Nevada ranked in the mid-40s in most education spending categories, but 22^nd highest in spending on school administration.

The money is there, but apparently it is being spent on other things.

When it comes to government salaries, Nevada’s state and local governments have been able to keep up with others in the same taxation neighborhood. Admittedly, the most recent figures available from the Census Bureau are for 2009, but in that year the state of Nevada ranked 12^th in the nation with an average monthly salary level of just more than $5,000. Local governments paid a similar salary level, and ranked sixth in the nation compared to local governments in other states.

The problem isn’t that Nevada collects too little in taxes. It is how it spends it.

Members of the Economic Forum on Wednesday release revenue forecast. (R-J photo)

But don’t expect any of this to be heard in the halls of the Legislature or inside the Capitol building.

They will just be talking about how the Economic Forum predicts the state will have “only” $6.3 billion to spend on the general fund in the coming biennium, if you discount those sunsetting taxes.

“Today’s Economic Forum report reminds us yet again that our revenue structure is not built to meet the demands of our changing economy nor our continued increase in statewide population,” Sandoval was quoted as saying. “Before I finalize and submit the state budget, I will ask my Cabinet to further scale back agency budget requests so that we can factor into account today’s projections.”

There’s never enough of our money to satisfy the avarice of the bureaucrats.

On the other hand Victor Joecks, NPRI executive vice president, released a statement that puts the revenue forecast in proper perspective:

Today’s Economic Forum revenue projections show why Nevada lawmakers do not need to consider tax increases during the 2015 Legislative Session.

The forecast of $6.3 billion in revenue for the next two-year budget cycle is the highest amount ever projected for Nevada. Combined with reversions of existing funds from agency accounts back to the general fund and other transfers, Nevada will be able to finance a spending plan comparable to its current $6.6 billion budget without raising taxes.

It’s important to compare the Economic Forum projection to Nevada’s historical levels of spending, not wish-lists from government bureaucrats.

The 2011 Legislature passed a budget of $6.2 billion, which included re-authorizing of supposedly “temporary” 2009 taxes the Sandoval administration had earlier pledged would sunset. Then, in 2013, lawmakers approved a general fund budget of $6.6 billion, which also included around $600 million in tax increases from the “sunset” taxes.

Taxed enough already?

States ranked by state and local government revenue per capita:

 

 

Nevada taxpayers will pick up the tab for Barry and Harry’s amnesty

Obama at Del Sol High School in 2008 (R-J photo)

Obama tonight will address the nation and explain how he is going to unilaterally rewrite legislation to grant amnesty to millions of illegal immigrants and then come to Las Vegas’ Del Sol High School with his pen in hand to sign the deal with Harry Reid at his side.

“This is personal to me,” Reid said in a statement. “There is no issue I have worked on more in my time as Democratic leader than immigration reform.”

What Barry and Harry fail to say is just who is going to pick up the tab for this magnanimity. Hint: The states, because it is the states that pay for education and most medical care and welfare benefits.

And Nevada will be among the hardest hit, because Nevada has by far the highest percentage of illegal immigrants of any state and the level has gone up in recent years.

According to a Pew Research report this week, in 2012 Nevada’s population included 7.6 percent illegals, its workforce was 10.2 percent illegals and its school enrollment included 17.7 percent whose parents are not in the country legally, all the highest levels in the nation, and those figures are up from two years prior.

And those figures could go up with amnesty since more illegals would be expected to try to join family members already here, expecting little chance of detection or deportation.

Just a few years ago the Las Vegas newspaper documented a small portion of the burden on the medical system of illegals by noting the cost of providing dialysis to illegals was costing UMC $24 million a year. Gov. Brian Sandoval has expanded Medicaid, which could make newly “legal” immigrants eligible for that and other benefits.

A Heritage Foundation report has estimated the lifetime fiscal cost of amnesty could reach $6.3 trillion, depending on how many are covered by the action.

Heritage chart

A report by the Federation for American Immigration Reform spells out some of the benefits for which newly legalized immigrants will be eligible, many state funded. Aliens with so-called deferred action are eligible for ObamaCare (which is disputed by some news reports), Social Security, Earned Income Tax Credit, Unemployment, Medicare. If they are children and pregnant women, they are also eligible for health care benefits through Medicaid and SCHIP in states that have opted to cover them, the report says.

Here’s the bill.

 

 

 

If Dems want more revenue for schools, cut spending

The Democrats in Carson City have rolled out their wish list of new taxes they want to impose in order to raise more money to spend on public schools.

Sort of like faith in the idea that more spending of your money will improve the public schools.

First they came up with an 8 percent tax on all entertainment admissions — movie tickets, concerts, plays, dance, sporting events, golf outings, strip clubs — that they said might raise $50 million though that is a ballpark guess, so to speak.

Now they want to jack up the job-killing payroll tax, especially on mining, and say it might raise $255 million, if there are any jobs left to tax.

Even Republicans have a plan to tax mining that they say would raise $300 million.

Nevada State Education Association already has an initiative that will appear on the November 2014 ballot to tax mining and raising what they say will be $800 million.

The stories are unclear as to whether those figures are annual or biennial, like the general fund budget.

But no one is even talking about cutting spending and using that money for education — as futile as that might be.

You see bills that would have reformed the public employee pension program and partially repealed the prevailing wage law never got out of committee, never got a vote and one never got a hearing in committees headed by Democrats who say they want to increase public education funding.

Repealing the prevailing wage law alone would save at least a half a billion dollars a year.

But, no, they’d rather continue to waste money they get now and add more of your money to waste in the future.

This chart from the Cato Institute shows how effective increased education spending has been thus far:

Harry: Mo’ taxes, mo’ taxes, mo’ taxes from the makers for the takers

Harry Reid insists on more taxes today on ABC’s “This Week,” and says the American people are behind him.

Reid

Harry, who hasn’t passed a budget in the Senate in nearly four years, said, “The American people are on our side. The American people don’t believe in these austere things. We believe that the rich should contribute. We believe we should fill those tax loopholes — get rid of them, I should say. And that’s where we need to go.”

Maybe he is right. The American people re-elected a redistributionist president. From each according to his means, to each according to whatever he wants — Medicaid, subsidized health insurance, food stamps, welfare checks, loot from Obama’s stash.

Obama ain’t tossing tennis balls to the Republicans

Guinness can circle the yard and catch the tennis ball every time. She could play center field on most teams.

Obama on factory floor for weekly radio address.

But Obama ain’t tossing tennis balls to the Republicans. He’s tossing hand grenades.

And he’s wrapping them like Christmas gifts. (OK, that metaphor broke down pretty quickly, but it was the only excuse I could come up with to post the video of Guinness.)

In his weekly radio address Obama calls on citizens to harass their representatives to make sure the Bush tax cuts won’t end and cost 98 percent of them an average of $2,200 in higher taxes each year, because that is what will happen if those evil Republicans refuse to punish the rich with $1.6 trillion in higher taxes over the next decade. “There are two things that can happen,” he says. All taxes go up, or taxes on the rich go up. That’s the choice take or leave it. There is no third or fourth or fifth option.

Standing on a factory floor Obama pleads:

“Congress can do that right now. They can give families like yours a sense of security going into the New Year. They can give companies like this one some certainty about what to expect down the road. And with the issue behind us, we’ll have more time to work out a plan to bring down our deficits in a balanced way – including by asking the wealthiest Americans to pay a little more, so we can still invest in the things that make our nation strong, like education and research.”

That investment includes $50 billion in so-called stimulus money he can dole out to his campaign contributors in the green energy business.

He then pulls out his cute marketing slogan, My2K:

“But it’s unacceptable for some Republicans in Congress to hold middle class tax cuts hostage simply because they refuse to let tax rates go up on the wealthiest Americans. And if you agree with me, then I could use your help.  Let your congressman know what $2,000 means to you. Give them a call. Write them an email. Or tweet them using the hashtag ‘My2K.’  That’s My2K.”

Who is holding whom hostage? He is the one ransoming the rich or the middle-class gets whacked.

Never mind that higher tax rates will not bring in near enough to cover his “investments.” (See British example again.) Never mind that he will find a way to blame Bush or the Republicans no matter what happens. This guy has never taken the blame for anything. He even claims his plan is working.