State’s tax study canceled
The contract to study Nevada’s tax system and how best to change it has been canceled.
Moody’s Analytics, the national consulting firm hired to perform the study, failed to meet any of its deadlines to develop that analysis and recommendations for the legislative committee studying how to fix what most officials agree is a broken system.
The study was to have analyzed both the taxes the state already depends on and other potential tax options, their stability in times of economic trouble and the burden they would impose on taxpayers. In addition, it was to look at how the state currently allocates revenue and the issue of earmarking taxes for specific purposes.
Lorne Malkiewich, director of the Legislative Counsel Bureau, said the firm has been working well with the Nevada Vision Stakeholder’s Group to develop a direction for the state to go for lawmakers and will continue doing that job. Moody’s will be paid $99,925 for that work.
But the remainder of the contract has been formally canceled, and Moody’s will not receive the $153,000 it was to have been paid for that work.
Malkiewich said Moody’s officials “were very upset with their performance.” The project manager has been replaced by a new manager who will complete the vision stakeholder’s report and recommendations.
“A lot of work has been done on that,” he said citing the nine different meetings held by the group appointed to advise lawmakers.
He said lawmakers, staff and Moody’s officials all agreed the tax study couldn’t be completed at this late date.
“We agreed we’ll drop it and we don’t pay them a penny for that,” he said.
Nevada is facing a budget shortfall of more than $3 billion – fully half the nearly $7 billion biennial general fund budget. The tax study, strongly supported by Senate Majority Leader Steven Horsford, D-Las Vegas, was intended to point lawmakers in the right direction for changing how the state generates tax revenue. Horsford could not be reached for comment on the impact of ending the tax study.