MUTH'S TRUTHS 02/27/2015

SB119: Tempting Conservatives with Forbidden Fruit by Chuck Muth February 27, 2015 Why can’t liberals – including liberal Republicans – just take “no” for an answer? In 2009 Nevada was in an economic crisis thanks to the Great Recession and the Legislature’s refusal to make the tough decisions that corporate America was already making: downsizing their work forces, reducing costs and cutting non-essential expenditures. Workers in the private sector didn’t like it.  Why should they?  But it was necessary for many businesses to stay in business.  The real question, though, is why government workers should have been exempted from the same type of pain as workers in the private sector who pay the salaries of the workers in the public sector. Nevertheless, the Legislature in 2009 refused to make the tough decisions on the spending side and instead approved a “temporary” package of tax hikes in the neighborhood of $640 million which were supposed to expire in 2011. But in 2011 the Legislature and Gov. Brian Sandoval broke their word to the people of Nevada and extended those “temporary” tax hikes for another two years rather than let them “sunset” as promised. In 2013, the Legislature and Gov. Sandoval broke their word to the people of Nevada yet again, and extended the “sunsets” for another two years. It’s now 2015.  The economic crisis that was used as the excuse to pass that package of tax hikes has long since subsided.  But instead of letting the “sunsets” finally sunset, Gov. Sandoval now wants to make them permanent.  And the Legislature is likely to go along with it despite GOP control for the first time since 1929. But this isn’t the only example of legislative funny business, including outright deception, when it comes to tax hikes. THE MORE COPS TWO-STEP In 2004, when economic times were booming in Nevada, voters in Clark County approved a tax hike to put more cops on the street – with a caveat.  Half now, half later if approved by the Legislature. By 2012, economic circumstances had clearly changed.  The boom times had gone bust.  And clearly there was no appetite for the second half of that eight-year-old tax hike among citizens of the state with the highest unemployment rate in the nation. Knowing they couldn’t get the 2/3 super-majority vote needed to approve the second half of the “more cops” tax hike in the Legislature, legislators used a little sleight-of-hand to circumvent the tax restraint law by  passing the buck for approving the tax hike to local county commissioners. The Legislature pulled the same fast one in Washoe County over a tax hike for school construction. With strong opposition from their hard-pressed local constituents, commissioners in both counties just said “no.” But once again liberals in both parties just won’t take “no” for an answer.  And legislators in Carson City are once again trying to circumvent the people in order to give the government more money. IT'S "FOR THE CHILDREN," OF COURSE School construction bonds funded through property taxes are approved by a vote of the people for 10-year periods.  However, voters have been rejecting new bond requests at the ballot box in light of the lingering effects of the Great Recession.  So what have the tax-hikers proposed to do this session? SB119 would allow the school districts to automatically extend those 10-year bonds for an additional 10 years WITHOUT a new vote of the people.  It’s being called a “bond rollover.”  So instead of taxpayers getting the promised tax relief at the end of the 10-year period as agreed to by the voters, they’ll get stuck with the tax hike for an additional 10-year period.  Victor Joecks of the Nevada Policy Research Institute estimates that this ploy - if approved by legislators behind the voters’ backs – “would cost taxpayers, specifically in Clark and Washoe County, between $3 to 4 billion, before including billions in interest costs.” Naturally, no self-respecting fiscal conservative would go along with such a scheme to put property tax hikes on auto-pilot.  A SPOONFUL OF SUGAR So liberal Republicans crafted a scheme to entice conservatives to take a bite from this forbidden fruit.  They’ve added to the bill a provision that would temporarily end a union welfare program called “prevailing wage.”  The prevailing wage law requires taxpayers to pay wages on government construction projects that are significantly higher than they would pay on the open, private-sector market.  If SB119 is approved, school construction projects would temporarily be exempted from the prevailing wage requirement – a significant savings for taxpayers.  Including the prevailing wage exemption in the bond rollover bill is a sneaky way for liberal Republicans to tempt conservatives in the Assembly to vote for a massive effort to increase property taxes without approval by the voters who will have to pay the higher property taxes. Conservatives legislators should not fall for this temptation and refuse to bite from the apple.  They should just say “no” because “no,” in this instance, is the right answer. And because sprinkling a little sugar on a turd sandwich doesn’t make the turd sandwich something other than a turd sandwich. THE CONSERVATIVE ALTERNATIVE Repealing the prevailing wage law is, indeed, the right thing to do.  But it should be done for ALL taxpayer-funded government construction projects, not just schools.  And it should be done in a bill completely separate from the automatic bond-rollover bill. If there is a “need” to build more schools – and I, for one, reject that claim - then make that case to the voters and let the voters decide if they want to pay for it. There is no reason in the world to take this decision out of the hands of the people who will have to pay the bill. As for the argument that our schools are overcrowded, there’s a far better and cheaper way to alleviate the problem than jacking up property taxes by billions of dollars: targeted school vouchers. Legislators should immediately approve offering $5,000 vouchers to parents whose children are in overcrowded schools if they’ll pull their kid out of the overcrowded school and enroll him or her in a private school of the parents’ choice.  In this way, not only will the overcrowding problem disappear almost overnight with no tax hike on property owners, but the cost of public education would actually go down since Nevada currently spends about $9,000 per child to educate him or her in a public school. But there’s no way on God’s green earth that legislators, backed by the teachers union, will ever even remotely consider this option unless FORCED to by killing SB119 as approved by the state Senate. Republicans in the Assembly should just say “no,” because saying “no” is the right answer. 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