Guinn "looking favorably" toward all proposals by tax task force

Gov. Kenny Guinn acknowledged Tuesday it will take much more than $350 million to fix Nevada's budget.

The state is facing a budget shortfall this year at least that much, but he said the $350 million figure doesn't address growing needs of state agencies and programs.

He cited public education as the most costly example, saying an additional 18,000 to 20,000 children would cost more than $150 million during the next two years.

In addition, it would take millions to cover the growth of the university system and pay for the normal increases in the cost of doing business at state agencies.

That includes rising rents, utilities and staff costs as employees move up the salary ladder.

"We've got to have $300 million to get ourselves out of a hole," he said. "Then we have to turn around and look at the growth we'll have."

And Guinn said that doesn't include some way of replenishing the state Rainy Day Fund. Guinn and lawmakers expect to take nearly all the $134 million in that fund to balance the budget this fiscal year.

Guinn said he's not endorsing anything yet, but is "looking favorably" on a long list of proposed tax increases being considered by the Task Force on Tax Policy.

That group, appointed by Guinn and the Legislature, will present its findings and recommendations on how to fix Nevada's complex and inadequate tax structure Nov. 15.

Guinn said that includes supporting the concept of a tax on the gross receipts of all Nevada businesses.

"There are companies in this state who pay virtually no taxes," he said. "And they make a lot of money when you look at the net."

He said his proposed budget will consider all the needs of the state and that he will consider everything the task force presents him.

Guinn's key opponent in next month's election, state Sen. Joe Neal, D-North Las Vegas, said he thinks Guinn should come out and say exactly what he supports and doesn't support.

"He's hedging and hedging," he said. "My position is we have to look at gaming because our biggest cost is the people brought in by gaming who use our services.

"We need to hit gaming to cover these costs," said Neal.

He said the other proposals Guinn is considering would primarily be a burden on Nevada residents instead of tourists.

Guinn also warned that the first year of the proposed budget will be very tight no matter what tax increases he recommends because that money won't start rolling in from those new taxes immediately.

He said he will be asking lawmakers to impose some increases -- such as cigarette and liquor taxes -- very early in the session so the money starts coming in as soon as possible.

For other proposals such as a business tax, however, he said it will take months before the revenue actually starts to show up.

As to objections raised to the idea of a business tax or a tax on amusements, Guinn pointed out that Nevada doesn't have some of the options other states do such as a personal income tax.

"That's not going to happen."

"If you look at Nevada, there's very few places you can go," he said.

He says the tax plan he presents will be designed not just to get the state through the next two years.

"I'm not going to be a part of it, piecemealing something together," he said.


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