CARSON CITY — Every time Gov. Jim Gibbons emerges from a meeting with legislative leaders, he says the talks were “cordial.” But the talks in the Nevada state Senate Friday afternoon — in which Nevada businesses flatly refused to pony up to help the state out of its budget crisis — were anything but cordial.
Things started out fine, with Nevada Mining Association boss Tim Crowley saying the industry has agreed to prepay some taxes, as well as raise a mining claim fee from the existing $5 to $25. The grand total for the state was $100 million. “We have to invest in our future, and mining has always lived up to that task,” Crowley said.
(Fat lot of good the gesture did: Later in the day, Gov. Jim Gibbons would say he doesn’t support pre-payment of taxes [they leave a hole in the budget] and state Senate Majority Leader Steven Horsford‘s spokesman Dave Berns said Horsford is similarly opposed to pre-payments.)
After a bizarre scene in which lawyer/Sen. Mark Amodei, the former head of the Nevada Mining Association, asked leading questions of Crowley, his successor, it was off to the races.
Billy Vassiliadis, head of R&R Partners and a lobbyist for the Nevada Resort Association, sat at the table in the well of the Senate with an unwelcome message: “This is the first time in many years I am coming to the table to say the gaming industry can’t be part of the solution,” Vassiliadis said. “I am sorry to say for the first time, we just can’t help.”
The news wasn’t a surprise. The industry put out a news release on Thursday night saying a $6.7 billion loss and 34,500 layoffs left the industry unable to help, or at least unable to reach a consensus among the Nevada members of the association. Vassiliadis noted the tax increases passed on the industry, as recently as the 2009 Legislature, when a room tax took effect.
“We’ve been doing more than our fair share,” Vassiliadis said. “The industry has come to the table every time this Legislature has asked.”
And, he noted with some irony, studies dating to the 1980s have said if the state relies on gambling and sales taxes to fund its general fund budget, “something bad will happen,” Vassiliadis said. “Something bad has happened,” he added wryly.
And something else bad was about to happen, too. Las Vegas Chamber of Commerce lobbyist Veronica Meter and Reno-Sparks Chamber of Commerce lobbyist Tray Abney sat at the table with an all-too-familiar message: Business just can’t help the state.
“At this time, right now, today, it is not the time to place additional burden on our businesses,” Meter said. “Our businesses don’t think they can give any more at this time.”
“If my members cease to exist, government ceases to exist,” Abney added, urging the Legislature to make it as easy as possible for businesses to hire people by streamlining registration and taxes. Business can’t do more without getting a fundamental reform of government in return, Abney said. The crisis is like shaking an Etch-A-Sketch, with the opportunity to erase the kind of government Nevada has created up until now. (Sound familiar?)
That brought state Sen. Randolph Townsend to his feet, with an angry reply. “No is not a plan. Taxing the world is not a plan,” Townsend said. If the business representatives are saying they should wait until the next session to fix the problem, “you are wasting our time. You need to be at the table now.”
Townsend asked both Meter and Abney to commit to coming up with ideas to solve the budget problem now, at which point both Meter and Abney repeated their talking points. Resolved: Both lobbyists had missed Townsend’s point completely.
But Townsend wasn’t quite done. “Don’t put preconditions — there are no conditions,” he said. “If you put preconditions on it, you’ll get nowhere. And if you come here with an attitude and say ‘it’s our ideas or nothing,’ you will accomplish absolutely nothing.”
It was fine theater, and Townsend was speaking for many in the legislative building who are frustrated with lightly taxed businesses hiding behind a two-thirds requirement to raise taxes and a governor staunchly opposed to any tax increase. But, the fact remains, there is no reason whatsoever for the business community to volunteer to pay a fair share of the costs of government: Nobody at this special session is even talking about a business tax.
Other business representatives, from the trucking industry, the retail association, the manufacturers and banks also testified, but it was Nevada Brothel Association lobbyist George Flint who was the only other industry representative, besides Crowley, to offer to help. Flint resurrected the idea of a $5 tax on prostitution, and estimated it would raise $2 million to $2.5 million for the state. That’s a drop in the $900 million deficit bucket, but it’s something.
“We’re ready to start tomorrow,” he said. “We don’t have a complaint in the world.”
So there you have it: Brothels and miners, willing to help, while casinos and other businesses say no. It’s Nevada in a nutshell.
Tags: Las Vegas Chamber of Commerce, Nevada Legislature, Randolph Townsend
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Looks like the retirees health insurance trust fund was one of the largest contributors to filling the hole. $35 million. Nothing like picking on the ones on a fixed income. Pulling the rug out from under them. I wonder if they can go back and reclaim their jobs? Read that retirees have had a 600% increase in premiums in the last 5 years alone along with a 300% in annual deductibles. To recoup the money the state took from the trust fund is going to require at least another 500% increase in premiums come July 2010….and again, just like 2003, premiums will consume almost all of many retirees pensions.