Another Opinion: Governor’s plan fails to address long-term problems
In announcing his plan Tuesday to address the state budget crisis, Gov. Jim Gibbons followed a well-worn path in Carson City. He neglected Nevada’s core problems and opted to push the state’s problems into the future.
To make the quick fixes, Gibbons wants to make a series of cuts, drain most of the state’s reserves and borrow from a local government line of credit. He also would make several budget shifts, including moving $164 million in federal stimulus money. This is little more than a shell game that in the best-case scenario will only delay the state’s woes.
If the idea of borrowing money sounds like hypocrisy from the governor, who likes to say we have to live within our means, it is. And there is more. Gibbons, who has proudly held to his infamous no-new-taxes pledge, is also looking to raise taxes in his plan.
His plan calls for rolling back some of the mining industry’s tax deductions to raise $50 million. He also called on the Legislature to consider making sure “certain online vendors” pay a “use tax,” which is the equivalent of a sales tax. In other words, Nevadans who buy from Internet sites would pay more.
As we have said for several years, the state’s tax system is broken and the result has been a paucity of services. Nevada needs to overhaul its tax policy because state revenue doesn’t keep up with even the minimal amount of services the government provides. However, governors and lawmakers have been unwilling to do that, and as a result, the state has suffered.
Instead, the state has relied on incremental fee and tax increases as well as other revenue-raising schemes to maintain minimal services. (One of the more curious of Gibbons’ proposals is a recommendation to hire a company to install automated cameras on the roads to catch people without vehicle insurance. He figures that’s worth $30 million next fiscal year.)
Yet oddly, the governor has yet to suggest changing a state law to make Nevada eligible for millions of stimulus dollars for education. That would be helpful considering he plans to cut 10 percent from education budgets.
A special session of the Legislature – particularly one with such short advance notice – isn’t the best time to revise the state’s tax system. For years Nevada has done study after study on it and all found the same thing – the system is broken. The result is that Nevadans have seen decreasing quality and quantity of services. The question is if anyone in the coming years will have the courage to do what is needed.