One More Step

In 2011, a constitutional amendment was introduced in the Nevada Legislature. And somehow, it managed to pass that year despite the acrimony and frustration that came to define the 76th session.

Fast forward to 2013. Even though SJR 15 had managed to pass Round 1, Round 2 was suddenly in doubt. The mining industry had doubled up its lobbying campaign, and it looked like that was about to reap mining conglomerates a huge payday. But then, another strange twist occurred.

As soon as it became a rather eye-popping attempt at "Republican rebranding" and a "no brainer" tax reform plan with actual bipartisan support, Legislature leaders had no choice but to stand back and let SJR 15 sail its way onto the 2014 general election ballot.

Today, the Interim Legislative Commission approved the final ballot language for SJR 15. Despite some last minute mining industry shenanigans and an awkward argument over the physical impact of mining, the Commission ultimately approved the SJR 15 ballot language 11-1.

So now, there's just one more step left for SJR 15. "We the People" must vote on it this fall.

Ever since the founding of this state, the issue of mining taxation has been a rather contentious, irritating, and occasionally even nauseating one. In a way, it's quite fitting that the 150th anniversary of Nevada statehood will be remembered for the people's vote on fixing a long debated error in our state's Constitution. How better to celebrate 150 years of Nevada than to take one more step to on the path to a functioning state government and a more equitable tax system?

SJR 15 PASSES #NVLeg, Goes to Voters Next Year

As we mentioned earlier, today is a huge day in the Nevada Legislature. Another of the bills receiving a final verdict in the Assembly is SJR 15, the bill to take the mining industry's corporate welfare sweetheart tax deal out of the Nevada Constitution.

There was some debate on the floor. And Assembly Member Pete Livermore (R-Carson City) offered this insightful quote.

Root Beer speech ! #NVLEG #SJR15 No more ROOT BEER if you kill off mining !!!! #RootBeer #Fries

Oh, yes. That's right. Assembly Member Livermore actually compared multinational mining corporations to his A&W franchise!

The bill passed 26-15. Again, Peggy Pierce (D-Las Vegas) was absent. Otherwise, all the Democrats present voted in favor while all the Republicans voted against.

And now that it's finally passed the Legislature in two consecutive session (it also passed both chambers in 2011), this finally heads to We (Us) the People.

Voters will now weigh in on NV's constitutional mining tax cap next year RT @RGJRayHagar: SJR15 passes Assembly, 26-15. #NVLeg

So this moves to the 2014 general election ballot for final approval. It may not be all that easy...

As reported by @RalstonReports, mining tried to bribe #NVLeg $50mil to kill SJR15. They'll spend at least as much to defeat it in Nov '14.

But now, we can finally look forward to our Carpe Diem moment with this and The Education Initiative on our ballot in November 2014. And even though she may no longer be serving in Carson City, Sheila Leslie's legacy just became even more awe-inspiring today.

Let's toss a little love to @sleslienv who was big on #SJR15 !!! #NVLEG

And on we go...

Writing on the Wall

Yesterday, Governor Brian Sandoval (R-Denial) received some good news. The Nevada Economic Forum projected $5.85 billion in revenue for the next biennium. Add in the nearly $600 million that Governor Sandoval wants to squeeze out of the Sunset Taxes (again), and the "GovRec" budget is about $44 million under the new projection.

So this is good news... Right?

“It shows we are not recovered,” Sen. James Settelmeyer, R-Minden, said. “We are not doing great.”

“Its peanuts, really,” said Ira Hansen, R-Sparks, referring to the $44 million more that Wednesday’s projections produced. [...]

“The only way we are going to get more for education is to raise revenue,” said Sen. Debbie Smith, D-Sparks, and the chairwoman of the Senate Finance Committee. “It is clear that our current situation is not going to do it.

“The speculation and comments that we have heard, that we will grow our way out (of the recession) so we can better fund education really doesn’t appear to be the case,” Smith said. “So we have to take a hard look about where we are.”

Democrats were expected to propose a new tax package that could include removal of many loopholes in the Live Entertainment tax and tweaking the Modified Business Tax.

“We were kind of treading water until we saw what happened today,” said Smith, speaking of the Forum. “We wanted to see what the extra revenue looked like.”

While they won't publicly admit it, it's starting to look like legislators are realizing that Nevada is indeed in great trouble. The state may soon be slapped with a law suit over inadequate public education funding. In addition, the state is already mired in hot water over the burgeoning mental health patient dumping scandal. Long story short: We're in deep s**t, and $44 million isn't nearly enough to fix decades of chronic underfunding of our public infrastructure.

Yet while the State of Nevada is still struggling, The Strip increasingly looks like Easy Street. Just today, MGM Resorts posted its first overall net profit since 2008. And Wynn Resorts continues to post strong earnings while looking for expansion opportunities.

Yet yesterday, Steve Wynn actually tried to cry poor in Carson City. No, really. See this.



So of course, Wynn won't allow for any gaming tax hike. But of course, that was never really being considered. I guess he's just so paranoid concerned about it that he wants to prematurely kill it by having legislators consider mining tax reform instead. At least on this, his wish is being granted today.

Feeling increasingly cornered, mining industry lobbyists are lashing out in Carson City today. They're decrying "economic populism". And they're claiming SJR 15 will destroy the world if enacted. And of course, reality continues to chime in and suggest otherwise.



Mining industry lobbyists have been working for a long time to quell any possibility of mining tax reform. But when even other parts of the previously united business lobby are breaking away and pointing fingers at mining, we have to notice that writing on the wall. And of course, when Nevada has its back against the wall in struggling to keep up with glaring needs, that writing on the wall becomes even clearer.

Something has to give. Something must change. The state needs more revenue. And the mining industry can certainly afford to pay its fair share.

Of course, this is still far from over. Mining lobbyists continue to fight like help to stop any & all mining tax reform. And the IP 1 "Mod Squad" clusterf**k threatens to complicate what should be a clear cut issue.


Yet with that being said, there's now an opening. The writing on the wall clearly points to it. Will legislators finally take it?

Supreme Tax Melee

Just a month ago, we were all blown away when State Senator Michael Roberson (R-Metamorphosis) and his merry "Mod Squad" decided to not just change the tax debate in Carson City, but radically upend it with their mining tax alternative to IP 1/The Education Initiative (corporate margins tax). All of a sudden, some Republicans decided that the best way to kill a tax proposal... Is by offering another tax proposal. And on top of that, they decided to target the very industry that's had its sweetheart tax deals written into the Nevada Constitution.

I know, I know. That's a whole lot to process. Yet so is the trouble "The Mod Squad Mining Tax" is now running into.

For one, it likely still doesn't have the votes for passage. (Instead, it's been worsening the civil war within the Nevada Republican Party.) And Governor Brian Sandoval (R-Nevada Mining Association) has threatened to veto it if it does pass. And even if it does pass and somehow overcome a Sandoval veto, a growing chorus of legal experts have been declaring it to be unconstitutional. Why? Since the Nevada Legislature never even voted on IP 1, how can it place an alternative on the ballot?

Amicus Nevada (aka Sean McDonald) first chimed in with his legal opinion suggesting Roberson's tax alternative isn't legal. And now, he's far from alone in thinking this. Yesterday, both the Secretary of State's office and the Attorney General's office reached the same conclusion.

The Secretary of State’s Office said this alternative or any other wouldn’t qualify for the ballot because the Legislature did not meet a deadline by which to introduce the alternative.

That keeps the Nevada State Education Association’s margins tax alone on the ballot. Voters will decide in 2014 if they should approve or disapprove of a 2 percent tax on business revenue that would raise an estimated $800 million for the state’s education system.

After consulting with the Attorney General’s Office, Deputy Secretary for Elections Scott Gilles wrote that the Legislature failed to take actions defined in the state’s constitution by March 15, the 40th day of the legislative session.

The constitution says that the Legislature needs to reject by the 40th day any initiative — in this case, the margins tax initiative — in order to preserve the right to introduce an alternative.

The legal question involved the definition of reject.

And obviously, the Governor's office also agrees with this. However, Roberson still doesn't. Instead, he's doubling down on his mining tax alternative. And he even has a brand new (Legislative Counsel Bureau) LCB opinion to back him up!

["You can do what you want, and the executive branch can't interfere," is] the gist of a new legislative legal opinion that mining taxman Michael Roberson obtained shortly after news broke of executive branch analysis that could block an alternative to the margins tax from the ballot.

It's all about the power of the Legislature to do what it wants.

There is a real separation of powers battle brewing this session, unlike any we have seen before.

Ralston is correct on the last point. We are now seeing an unprecedented conflict over separation of powers, and over who ultimately sets the rules on what makes the cut for the ballot. Roberson & the LCB are arguing that the Legislature can essentially reject citizen initiatives and place alternatives to compete against them on the ballot, the Legislature can do so however it wants, and everyone else must essentially accept this as legal.

Amicus Nevada, Governor Sandoval, and both the Secretary of State's office & the Attorney General's office disagree. They're saying that Article 19 of the Nevada Constitution stipulates that any alternative to a citizen initiative petition must be rejected in an actual vote of the Legislature. They've also hinted that it's unclear as to whether the Governor's approval is also required to move an alternative initiative forward. And on top of that, is this mining tax also violating the single subject rule (since it proposes a completely different tax than that of IP 1 itself)?

At the very least, the legal waters here are very murky. This nonetheless doesn't seem to be stopping Senator Roberson's "Mod Squad" from pursuing their mining tax alternative. It's now just a matter of how much further it can go in the Nevada Legislature... And how long before The Nevada Supreme Court is asked to intervene.

What a Day This Has Been

Whoa, what a day this has been! SJR 15 not only got a(nother) hearing today, but it also passed out the Senate Revenue & Economic Development Committee unanimously! Oh yes, that's right. Ruben Kihuen (D-Las Vegas), David Parks (D-Paradise), Michael Roberson (R-Henderson), Mo Denis (D-North Las Vegas), Greg Brower (R-Reno), Debbie Smith (D-Sparks), and Ben Kieckhefer (R-Reno) all voted for SJR 15!

So how did it happen? For one, the mining representatives did a great job... Of making the case for mining tax reform!





As you can see above, Brower & Roberson were quite irritated with the "non-answer answers" coming from the mining industry's mouthpieces representatives testifying today. They wouldn't answer on how much their clients actually pay. They wouldn't answer on whether they'd sue for lower taxes if SJR 15 passes. They wouldn't even answer on what their official position is on SJR 15!

And in case that wasn't potent enough, Democratic & progressive activist Marla Turner testified today. Not only does she have her own amazing reputation, but she's also the stepdaughter of the late Assembly Member Marvin Sedway. In 1989, he railed against the many bailouts the mining industry enjoyed at the time. Marla was there to remind legislators of what actually happened in 1989... And why it matters in 2013.



In 1989, the mining industry agreed to SJR 22, the constitutional amendment that set up the current tax scheme. It did so only to fend off much more sweeping tax reform, such as a new extraction tax. While mining lobbyists do a song & dance routine on how little much their clients pay and what SJR 15 supposedly will do, they wouldn't be so fearful of SJR 15 if they didn't think it would undo the worst parts of the SJR 22 deal in 1989... The one that Steve Wynn (??!!) warned the Nevada Legislature of that year.

By the way, Roberson cited that very speech from Wynn at the hearing today.

Don't be mistaken. What happened today was truly historic. For perhaps the first time ever, the Nevada Legislature may finally stand up to the mining industry and impose fairer taxation! Democratic & Republican legislators are leading the charge on this. And Governor Sandoval is increasingly being boxed into a corner on this.

Oh, what a day this has been.

#NVLeg #SJR15 Liveblog

Wait, there are more fireworks in #NVLeg today? Oh yes, there are! We've been talking for some time about mining tax reform. Now, the day has finally come. SJR 15 returns to the Senate Revenue & Economic Development Committee today.



Stay tuned as we await SJR 15 testimony.

2:05 PM:



Senate Minority Leader Michael Roberson (R-Henderson) just grilled Nevada Mining Association President Tim Crowley. He asked for the official position of the Nevada Mining Association on SJR 15. He asked if they will sue the state if SJR 15 passes. And he asked about the current mining tax structure. Crowley couldn't provide a clear answer to any of Roberson's questions.

A Fennemore Craig Jones Vargas attorney is now speaking for the Nevada Mining Association in addition to Tim Crowley. So far, it looks like legislators are actually showing some skepticism to the mining industry's spin (for a change).

Mining for Reality

I know we keep talking about this. But hey, we're talking about it because this is important. And we're talking about it now because we need to cut through the spin and find some reality.

So let's briefly talk about what went down on KNPR just moments ago. Of course, Senate Minority Leader Michael Roberson (R-Metamorphosis?) jousted with Nevada Mining Association President Tim Crowley on SJR 15 and Roberson's controversial IP 1 mining tax alternative. Crowley kept trying to deny reality, while Roberson was tooting his own horn as he was ripping into Crowley's attacks on his mining tax proposal.

Today's "State of Nevada" was fiery... But what if it was ultimately just Sturm und Drang? As we discussed last Thursday, there's a strong possibility that the clock has simply run out on Roberson's IP 1 alternative because the Legislature did not actually vote on IP 1. As Nevada's hottest new legal blogger Sean McDonald/Amicus Nevada explained, legislators must actually reject a people's initiative in an actual floor vote before they can propose an alternative initiative. While the Legislative Counsel Bureau (LCB) and Steve Sebelius disagree, it's increasingly looking like the consensus view is that Roberson is standing on the legal equivalent of quicksand with his IP 1 alternative.



So where does that leave the debate on mining taxation? Actually, that brings us back to SJR 15. It already passed #NVLeg once. And there's no legal fight surrounding it. Yes, all SJR 15 does is remove the mining industry's tax rate (and exemptions) from the Nevada Constitution. Yet that alone can make a world of difference.



Tim Crowley claims SJR 15 will do away with any mining tax. That's only possible if the mining industry goes to court and wins a law suit. Is that what the mining industry wants to do?



What's more likely is that multinational mining corporations will be forced to pay something closer to their fair share because their tax rate & exemptions are no longer written into the Nevada Constitution. That's why the mining industry is fighting SJR 15 tooth and nail.



The real reason the current mining tax structure was instituted in 1989 was because the mining industry refused to pay a severance tax. Imagine if #NVLeg was considering a gold severance tax similar to the oil severance tax proposals being considered in California and Ohio. But alas, that's not happening. Instead, certain legislators are discussing placing an increase in the net proceeds tax onto next year's ballot to compete against The Education Initiative. And at this point, it will likely soon prove to be fool's gold (as it may no longer be legally feasible).



But you know what's still here? SJR 15. It's just waiting for a second round of approval so it can go to voters in 2014. It won't compete against The Education Initiative, so no worries there. And if passed by voters next year, SJR 15 will finally give legislators the flexibility they need to properly set mining taxes. If Michael Roberson still feels strongly about raising the net proceeds tax, he can introduce one then.



Remember that former State Senators Sheila Leslie (D-Reno) & Steven Horsford (D-North Las Vegas) introduced SJR 15 back in 2011. It wasn't until this month that Michael Roberson suddenly embraced mining tax reform as "his cause". And the mining industry has enjoyed the current lax system of nearly no taxation since 1989. Keep all of this in mind as we keep digging past the kabuki theater to uncover reality.

Mining for #Winning

Ah, so now we know. Senator Michael Roberson (R-Henderson) has risked dividing his own party (even further than it has already been) with his IP 1 mining tax alternative. So why has he been willing to escalate Nevada Republicans' civil war?

This helps explain why. Remember when Monte Miller was pushing a mining tax initiative? Let's just say he didn't pull the plug on it due to lack of public support.

Before he abandoned his attempt to tax mining last year, businessman Monte Miller hired master voter contact man Billy Rogers to gauge support. So Rogers went door-to-door asking folks how they felt about raising the mining tax from 5 percent to 9 percent.

Out of 22,991 interviews completed before Miller decided not to proceed, Rogers identified 18,634 mining tax hike supporters. That's 81 percent.

So not only would a mining tax pass -- my guess is no matter what the industry did to try to block any ballot question -- it would pass overwhelmingly.

Highlights (and the full demographics are attached here):

· Overall, 81 percent supported increasing the mining tax

· 88 percent of Democrats supported increasing the mining tax

· 80 percent of non-partisan and third-party registrants supported increasing the mining tax

· 73.5 percent of Republicans supported increasing the mining tax

Apparently, Monte Miller has always taken a liking to Michael Roberson. Would anyone like to guess how and why these numbers are now public? And does anyone doubt Roberson hadn't already taken a look at these numbers?

And to think, less than a month ago even SJR 15 was in a shaky position. Why? One of the dirtiest secrets in Carson City is just how much juice the mining industry has in that town. Could it possibly be due to all the lobbyists and all the campaign contributions?

Yet this month, Roberson and the rest of his "Senate GOP Mod Squad" decided to break away from their former mining industry BFFs. Why? Look above. No, look further above. When even over 70% of rank-and-file Republicans (!!!) support mining tax reform, perhaps knee-jerk opposition to it should be reconsidered... And ultimately dropped.

Of course, Roberson's IP 1 mining tax alternative still faces great hurdles. For one, those mining lobbyists won't be going away any time soon. In addition, it's at best (for him) legally unclear as to whether he can even propose one now. Let's just say that if "The Mod Squad Mining Tax" goes down in flames either in the Nevada Legislature itself or the Nevada Supreme Court, it won't be due to lack of public support.

(But of course, SJR 15 still isn't going away any time soon, either!)

On Sharron Angle, Nevada Republicans, & Mining Tax

She's back! Really, how long can we go without a Sharron Angle sighting? She was spotted at the Nevada Legislature today. Here's what she told Ralston.

Caught up w/@SharronAngle. Said just visiting, not here for any bill. Might she be on the ballot in 2014? "Anything's possible." #lickschops

We've discussed before how Sharron Angle continues to influence the Nevada Republican Party. And we're seeing that on display again now.

Last week, State Senator Michael Roberson (R-New RINO?) announced his poison pill intended to kill The Education Initiative. OK, that sounds conservative enough. But there was a twist. Roberson decided to introduce an alternative to IP 1 in a new mining tax... And 5 of his Senate Republican colleagues joined him in support of the IP 1 alternative mining tax!

Of course, that led to the explosion of Chuck Muth's head. And not only that, but apparently other powerful "Tea Party, Inc." operatives are about to declare war on "The Dirty Half-dozen". As we discussed last week, Roberson is worsening Nevada Republicans' civil war with his pursuit of mining tax reform.

It's not as if prominent Nevada conservatives haven't complained about the mining industry's sweetheart deal before. Can you guess who said this?

"The mining industry has traditionally sort of been given a pass for some reason or another. I guess it goes back to the days when they were the bosses and they were the big business in the state. That was a long, long, long time ago." [...]

"The reason I am here and I have this sense of urgency in my voice, is because I have a fear, that like other things that have happened in the state of Nevada recently, this is an attempt for one sector of the economy to insulate itself against its fair share: and I know what happens when that happens up here because you fellows always look to us. And you cannot allow that to happen, if you take some time to study it. This sort of thing has got to come to a halt. You have to take an intelligent, close, careful look at how you are going to face the future."

"(What) we should have done last year and which should be done immediately, is that we should remove mining from its special consideration to be treated like the rest of the businesses, like the rest of us in the State of Nevada."

Believe it or not, that was "tea party" icon and Las Vegas Strip power player Steve Wynn back in 1989. And just last year, "Tea Party, Inc." kingmaker Monte Miller pushed a mining tax initiative! Roberson's new proposal was apparently inspired by Miller's initiative.

So it's not as if Nevada Republicans were completely opposed to mining tax reform before. But because the "tea party" demands ideological "purity", any realistic tax talk is no longer allowed. That's why Congress can't reach a budget deal. And that's why Michael Roberson and the rest of the Senate GOP "Dirty Half-dozen" are facing immense backlash from their own party.

She may have lost NV-Sen in 2010, but Sharron Angle seems to be winning the battle for the soul of the Nevada Republican Party today. We'll just have to wait and see what kind of carnage she and Muth want to see in Republican primaries next year. I have a feeling that won't be pretty (except in the eyes of certain Democratic operatives).

Mining for Clarity

This has been one exciting week in Carson City. After a month of stalemate on tax reform, Senate Minority Leader Michael Roberson (R-Henderson) came forward with his mining tax proposal. All of a sudden, a Republican offered a new tax plan, targeted perhaps the worst example of corporate welfare in Nevada, and revived something that many assumed (myself included) was dead in Carson City.

Yet even today, challenges remain. Remember that Roberson proposed his mining tax as an alternative to The Education Initiative. Yet while Republican legislators are united in opposition to that, they're divided on Roberson's alternative tax. This division was on display on KNPR this morning when Senator Pete Goicoechea (R-Eureka) proclaimed his opposition to both tax plans on "State of Nevada".

When confronted with the question of how to balance the budget and properly fund public education without either tax, Goicoechea had no real answer. That's the challenge for him, Sandoval, and other Republicans. That's probably a reason why Roberson and the rest of who Ralston calls "The Dirty Half-dozen" broke ranks with fellow Republicans. They realized this was a prime opportunity to take a more populist tack, show actual support for public education, and fight The Education Initiative in a more politically palatable way.

But again, this has managed to divide Republicans. And to complicate matters further, there's no clear path to Roberson's IP 1 alternative reaching the 2014 ballot. Ralston is still trying to wrap his head around that!

I'm no lawyer, but there doesn't seem to be any mention of a veto and an override, and this is a special case in the Constitution, unlike other bill passages. On the other hand, the word "approval" could be construed to mean "in the ordinary approval of a measure," which would mean to disapprove it Sandoval would have to veto it.

So I am, ahem, supremely confident it....could go either way. (I welcome legal opinions in the comments or via email.)

Roberson seems confident the alternative tax bill would be deemed vetoed and lawmakers could override. He has verbal confirmation from legislative attorneys.

That is, it is "the same language that is used for any bill," he told me. "The word 'veto' is not in the Constitution in connection with approval by the governor for any legislation."

And he's right. The word "veto" does not appear in the Constitution when it refers to the governor approving bills. But as strong a case as that may be, "approval" also has been construed in practice to mean the governor either signs it or he...vetoes it.

Article 19 of the Nevada Constitution only states that any alternative to an initiative petition must be approved by the Governor. Yet Governor Brian Sandoval opposes both IP 1 itself and Roberson's alternative. So what happens if/when Sandoval vetoes Roberson's mining tax? And that assumes Roberson's mining tax can achieve the 2/3 supermajority necessary for passage (and override of Sandoval's veto).

That's another major challenge. The mining industry has already been waging an expensive war just to derail SJR 15, the constitutional amendment to remove the 5% mining tax and all the loopholes (that make the effective tax rate far under 5%) from the Nevada Constitution. What will mining lobbyists do in the coming days to fight this new development? We all know that's coming.

And then, there's The Education Initiative itself. Will it have competition on next year's general election ballot? Will all the renewed focus on tax reform compel the Legislature to craft some sort of alternative? Will all the renewed tax reform talk actually help drive the message home for The Education Initiative?

Right now, the fiscal picture in Carson City is looking quite unclear. However, the renewed energy for progressive tax reform is looking crystal clear. What also is looking clear is the opening progressives now have for tax reform thanks to a divided Republican Party. So what will ultimately make it through that opening? We shall see.

Roberson Opens Pandora's Box.

It was supposed to be "genius". Yesterday, Senate Minority Leader Michael Roberson (R-Henderson) shocked everyone with his brand new tax triangulation scheme. In what will likely be a final and lasting break from his former political soulmate, Roberson proposed a new mining tax as an alternative to The Education Initiative.

Roberson figured this would be political master stroke. Find a way to bury The Education Initiative alive, throw Democrats into disarray, and claim new populist ground in proposing mining tax reform. What's not to love? It now looks like several of Roberson's fellow Republicans are answering that question in a way he didn't want.

Oops.

“I'm not happy," said Sen. Pete Goicoechea, R-Eureka, whose rural Nevada district includes most of the state's largest mining projects.

“I don’t know if we’re sending the message right now to the mining industry that we’re going to throw you under the bus,” he added.

Sen. Barbara Cegavske, R-Las Vegas, opposed the move outright.

“I don’t support singling out on industry,” she said. “It wasn’t a good idea in ’03, and it’s not a good idea today.”

The reaction from many Assembly Republicans, who were not told ahead of time what the Senate Republicans were planning, was nothing short of anger.

“For those of us in the rurals, getting stabbed in the back by the Republicans — the party that supposedly opposes tax increases — is disgraceful,” Assemblyman Ira Hansen, R-Sparks, said.

Assemblyman John Ellison, R-Elko, echoed the sentiment.

“A bunch of us think the six individual senators should have come to see us before making a decision,” he said. “They should’ve come talked to us.”

And to make things even worse for Roberson, Governor Brian Sandoval (R-Nevada Mining Association) quickly announced his opposition to the Roberson mining tax plan. Oh, and the gaming arm of "The Gaming-Mining-Lobbying Industrial Complex" (aka the Nevada Resort Association) won't support the Roberson mining tax plan, either (though it didn't really take any position on SJR 15).

Michael Roberson has now opened Nevada Republicans' version of Pandora's Box. He was hoping to fracture the left with this move. Instead, he's fracturing the right.

And Roberson's big move may ultimately create a constitutional crisis this session. Article 19 of the Nevada Constitution explicitly states any alternative proposed by the Legislature must be approved by the Governor. Since Roberson is proposing this mining tax as an alternative to The Education Initiative, it must be signed by Sandoval.

But what if Sandoval doesn't sign, as he's already signaled he will? Can Roberson secure the votes to override a Sandoval veto? And even if he does, is that even legal? Hello, Nevada Supreme Court! And welcome back, 2003.

Certainly, Roberson shook up the budget debate in Carson City with his new tax plan. He just so happened to unleash an earthquake where he wasn't expecting one. And on top of that, the new divisions among Republicans and "The Gaming-Mining-Lobbying Industrial Complex" give progressives an unprecedented opening to pursue real tax reform in the next 20 months.

All of a sudden, the 77th session of the Nevada Legislature is looking quite fun. And we have Senator Michael Roberson to thank for this.

False Dichotomy, Real Fissures... & Renewed Hope!

Oh, my. Guess who's suddenly changing his tune on "The T Word"!

Nevada Senate Republicans called on the Legislature today to both remove the mining industry’s constitutional tax protections and find a way to increase taxes on the industry as an alternative to the margins tax ballot initiative.

The announcement comes as the Legislature today prepares to hear testimony on the initiative petition supported by the state teachers union to create a margins tax on business revenue. [...]

“We believe the current discussion relating to broadening the tax base and finding more money for education is important,” said Senate Minority Leader Michael Roberson, R-Henderson. “To that end, we will continue to work with our colleagues on both sides of the aisle to identify sensible structural reforms to Nevada’s revenue system.” [...]

“Billions of dollars of nonrenewable natural resources are extracted from our state and shipped out-of-state every year,” Roberson said. “These resources cannot be replenished. At some point the gold will be gone. And, when the gold is gone, mining will be gone. It is imperative that we ensure that Nevadans get the best deal we can, while we can.”

Oh, yes. That's right. One time "tea party" darling Michael Roberson has now completely ditched his Grover Norquist/Chuck Muth "NO TAX!!!" pledge! Welcome to the Caucus of the Sane, Senator Roberson.

Oh, but wait. There's a catch. Even while co-opting progressives' message and ideas on mining tax reform, Roberson and his fellow Senate Republicans are trying to misuse this to kill The Education Initiative!

Now think about that. Senate Republicans are essentially playing out their fucked up version of "Sophie's Choice" by sacrificing their once sweet & sultry relationship with the mining industry so they can save their other big business sweethearts. How... Yuck.

But wait, there's more. Roberson is also trying to divide and conquer the left with this move. He's betting his sudden move on mining tax reform will create a fissure within the Democratic Caucus while further alienating Democratic leadership from the progressive base.

Frankly, Roberson need not worry about the latter. Marilyn Kirkpatrick is already doing a great job at that. Yet even with that, there won't be any mass exodus from the Democratic Party just because of a few boneheaded moves by a few Dems. (Instead, there may be more primary challenges next year.) Meanwhile, he should probably be more concerned amour the fissure he's about to create in his own party.

Roberson will take the lead, but I understand he has support from Ben Kieckhefer, Joe Hardy, Mark Hutchison and Greg Brower. But my guess is a few members of his caucus will not be at the news conference today.

Now about Gov. Brian Sandoval....

Clearly, Roberson didn't clear this with Brian Sandoval. And it's unclear at this point just how many Republicans Roberson actually has behind his brand new tax plan (ripped out of PLAN's playbook).

It's just hilarious to see these silly games and real divisions arise from a false dichotomy. We really don't have to choose fair taxation for mining companies or fair taxation for other multinational corporations ripping us off. No really, we can have both!

Both sets of companies have gotten away with excessive corporate welfare. And really, this kind of chaos emanating from both Democratic and Republican leaders may bode quite well for progressive activists working to achieve both... And even more in the future. For far too long, "Tea Party, Inc." has held the party line on all taxation while various corporate lobbyists conveniently blamed each other's clients for Nevada's great EPIC FAIL on taxation. All of it was truly just kabuki theater meant to divide and conquer so no power player in Carson City would have to worry about any real progressive tax reform.

Today, this is finally changing. This time, the fissures are real. And the prospect for smart tax reform is real. Michael Roberson may not recognize this, and perhaps it's best that he doesn't right now. But really, he's doing progressive activists a big favor today. Thanks, Senator!

Pulling the Mask

Over the past month, we've been keeping tabs on SJR 15... And the mining industry's campaign to kill it once & for all. Yesterday, that campaign hit a new low when the mining industry decided to go beyond its usual backroom wheeling-dealing. So what caused Jim Rogers to say this on KSNV/News 3 last night?



Apparently, the Nevada Mining Association doesn't like KSNV's series on SJR 15 & the mining industry's campaign to kill it. This has been groundbreaking as reporter Reed Cowan has essentially blown the whistle on Carson City's cesspool of corruption on a major TV newscast in the largest media market in the state. Just take a look at Part 4 of this series. This finally hit TV airwaves.



And it has the mining industry running scared. Mining companies prefer that we not see their bribing requests of lawmakers to do their bidding in Carson City. And they certainly don't want us to notice just how little they pay in taxes.

So the mining industry retaliated. The Nevada Mining Association pulled ads from KSNV. Mining lobbyists must have been hoping the hit to Jim Rogers' station's bottom line would make him cry uncle.

But instead, Rogers took his case to viewers. And finally, finally after so many years of hiding behind pretty faces in glossy ads, that mask has been pulled from the Nevada Mining Association. And more Nevadans are finally seeing the true ugly reality of mining in this state.

For far too long, the mining industry has discreetly courted legislators in Carson City, far away from the view of over 70% of the state's population. And mining companies prefer it stay that way. After all, despite their glitzy media campaign, voters want change. They fear what lies ahead if/when more of the truth on mining is exposed AND Nevada voters finally have a chance to decide mining taxation for ourselves.

Deja Vu... No More

It hasn't even been two weeks since the Legislature began its 77th session, and already it feels like deja vu. During the first week, leaders in Carson City talked so much about "having a real conversation" on taxes. Yet despite having various real tax reform proposals on the table, they still look ready to ignore those proposals.

And not only that, but they're also talking about the very same hockey stick that has always been used to kick the puck of real tax reform down the road.

This legislative session, Senate Minority Leader Michael Roberson, R-Henderson, has said he supports discussing a sales tax on services that would broaden the tax base and allow the Legislature to decrease the overall sales tax rate.

He’s reprising an idea that Nevada has discussed for more than 20 years.

“Broadening of a sales tax base, coupled with some reduction of the sales tax rate, is appropriate,” said the 1989 Governor’s Commission to Study the Fiscal Affairs of State and Local Governments in Nevada, which recommended broadening the tax base be the “paramount concern” of the Legislature.

Roberson has said many times that he supports broadening the tax base, but “any kind of tax reform needs to be revenue neutral.” He’s again channeling ghosts of 1989.

“Broaden, on a revenue neutral basis, the general sales tax base to fully include hotels and lodging, food for home consumption, drugs, household fuels and other utilities (including telephone service), service to persons (e.g., dry cleaning, beauty and barber shops) and newspapers,” said the 1988 Price Waterhouse fiscal affairs study.

And that's not all. There have also been endless promises of "real tax reform". Yet when push comes to shove, we get nothing... Except for that very same stick and puck.

So are we set for deja vu yet again?

Perhaps not. After all, there are two major differences this session: The Education Initiative and SJR 15. The latter was already passed for the first time in 2011, while the former already collected more than enough signatures to qualify for the 2014 ballot if the Legislature doesn't act on it. All SJR 15 needs is a second round of passage this year in order to go to the voters on the 2014 ballot.

What's so sad about this is that these two proposals address the most glaring problems in Nevada's budget. It's pretty much common knowledge now that the mining industry pays nearly nothing in taxes, the other largest corporations doing business here pay very little in taxes, and the budget is far too reliant on the fortunes one sector (gaming & tourism). The Education Initiative and SJR 15 can break the cycle of logjam and empty promises on real tax reform and provide much needed revenue to fund our public infrastructure.

All the Legislature needs to do is pass SJR 15 a second time. That's all. It's not even really a vote for "more taxes". It's just allowing voters to decide on doing away with mining tax loopholes so legislators actually have more oversight on mining taxation.

And if legislators are really too scared to pass The Education Initiative themselves, then they should just let "we the people" decide on it next year. As my favorite philosopher would say, "Don't f**k it up."

This time may finally be different. It's just a matter of whether legislators want to take part in making the difference.

A Valentine's Day Message for Nevada Mining Lobbyists

Ah, Valentine's Day. For many, it's a day of love. But for Nevada, it's a day of heartburn.

But today, politicians in Carson City will be feeling the heartburn for a change. Why? Read this and cringe.

• Trans-national mining conglomerates took $8.76 billion in gold from Nevada in 2011, and paid a total of $104 million to the state general fund under the mining tax, an effective tax rate of 1.187%. In 2010, they mined $6.64 billion in gold, and paid $71.7 million in taxes, an effective tax rate of 1.079%. (Nevada Department of Taxation)

• Mining does pay sales tax and they pay certain property taxes—but not on the value of the mine or their mining claims. Renters, the unemployed, and minimum wage workers also pay sales and property taxes. But gold mining is different, so it should be taxed differently. Once that gold is gone, it’s gone forever. The money will be in Canada and other foreign countries, leaving Nevada with clean up costs and massive pits.

• Three of the five largest mines in Nevada are foreign-owned. The second largest mine in the world, and the most profitable mine in the world, is owned by Barrick corporation, based in Canada. This single mine will exceed $1 billion in profits in 2012, having reaped $500 million in the second quarter and $313 million in the third quarter of 2012 alone.

• Barrick pays next to nothing in taxes on the huge windfall profits from the world’s most profitable gold mine—paying a mere 1% on gross production value in taxes to Nevada’s General Fund in 2010, according to the state’s 2010-11 net proceeds of minerals tax (NPOM) bulletin.

No really, it's that bad. But really, we shouldn't be surprised. After all, we've been following the sordid, sick love affair between this state and the mining industry for some time. It's perhaps the worst kept secret that multinational mining corporations have constantly taken advantage of this state. Yet because they're part of "The Gaming-Mining-Lobbying Industrial Complex" that all too often calls the shots in Carson City, they've been allowed to get away with this legalized robbery.

Yet they're afraid now... And so are their political bed-mates in Carson City. Why? Oh, because a growing number of Nevadans are calling foul on this revolting love affair.

In this week's Reno News & Review, Sheila Leslie calls out the mining industry's greatest fear.

There is no hope of renegotiating how mining is taxed in Nevada unless the special provision protecting the industry is removed from the state’s constitution. While the industry insists the NPOM tax is a property tax, it acts like an income tax, allowing deductions for all sorts of things with the net effect of some mines actually paying zero in NPOM taxes. Zero. Until a few loopholes were closed last session, the mines could even deduct the cost of their dues to the World Gold Council, an industry marketing organization.

Other states tax mining differently, through severance taxes, excise taxes and the like. Mining companies also have to pay a corporate profits tax in every state but South Dakota, Wyoming, and, naturally, Nevada. In other countries, the industry often pays a royalty tax when they mine public lands as a method of compensating the real owners of the gold.

In the 2011 session, the Legislature started the process of removing the sweetheart tax deal from the state constitution by passing Senate Joint Resolution 15. To continue the five-year process of amending the state constitution, SJR 15 must pass again in 2013 and then go to a vote of the people.

It is clear the industry has literally billions of dollars at risk should this resolution pass and has been sparing no expense in campaign contributions, charitable donations, public relations campaigns, and lobbyists gearing up for the battle this session. They know they need to kill it now before the public votes.

A quick review of the lobbyist list last week revealed 24 registered lobbyists for mining, exceeding the number of state senators by three. And the president of the Nevada Mining Association and three other prominent mining lobbyists hadn’t even registered yet. As one seasoned observer noted, “Mining is prepared to spend millions to save billions in taxes.”

In a rare moment of political courage and policy sanity, the Nevada Legislature passed the first round of SJR 15 in 2011. But remember, a constitutional amendment that originates in the Legislature must pass in two consecutive sessions before going to a vote of the people in the next general election. That's why mining industry lobbyists are now fighting furiously to protect their corrupt sweetheart deal in Carson City. They're whispering sweet nothings in legislators' ears and vowing to "make it rain" (in campaign contributions) on legislators who return into the arms (and the tight grip) of the mining industry.

And this is why PLAN will be making a special visit to the Legislature today. They'll be asking for Nevada to finally seek a divorce from the political control of the mining industry. After all, what good has this marriage of political convenience been for the people of this state?

Much is being said about tax reform this session. But yet again, legislative leaders, corporate lobbyists, and high perched media pundits have arbitrarily declared that the only "reform" that's allowed is "reform" that's "revenue-neutral" and incredibly unfair to Nevada's working families. But unfortunately for this sorry bunch, Nevada's working families have had enough of this nonsense. They're ready to stand up and fight back.

It's time for Nevada's legislators to get serious on real tax reform. They already passed SJR 15 in 2011. It's time for them to pass it again so that we the people can have a say on this next year. Their love affair with mining industry lobbyists just isn't working for our state. It's time for them to divorce so we can begin fixing this state.

Mark Amodei... Is Still the Mining Companies' Best Friend

Well, I wouldn't expect less from the former Nevada Mining Association President who just happened to serve in the state legislature as well. Mark Amodei wants us to know that it's hard out there for the multinational mining corporations. That's why he insists we must deregulate mining some more.

The U.S. House of Representatives recently passed a bill introduced by U.S. Rep. Mark Amodei, R-Carson City, to streamline the permitting process for mining operations.

Earlier this month, H.R. 4402, the National Strategic and Critical Minerals Production Act of 2012, passed the House by a vote of 256 to 160.

The bill was the second introduced by Amodei that has passed the House since he was elected in 2011.

In his floor remarks on the bill during testimony on July 11, Amodei said the bill sets a 30-month time limit for the permitting process, unless the applicant agrees to an extension.

“This does nothing to tax law, this does nothing to safety law, this does nothing to supplant NEPA and this does nothing to supplant any state things,” Amodei said.

Oh, really? I wonder why he hasn't said that to communities across this country who will have a more difficult time protecting their natural resources if Amodei's bill becomes law. HR 4402 aims to eliminate strong environmental review of proposed mining projects and prioritize mineral extraction over conservation AND recreation for most federal lands. It's all about speeding up the permit process so mining companies can pump up their profits, even if they make people suffer in the process.

As PLAN warned earlier this year, HR 4402 takes us in the wrong direction on mining policy. It's bad enough that our state allows the mining industry to walk all over us. We'll only make matters worse if we allow for mining to weaken federal regulations necessary to protect communities from unnecessary damage.

And About That Other Case of Tax Evasion...

Perhaps there's new meaning to the term "Apple of gold stocks". Public News Service has more on what's still the biggest tax evasion scheme in Nevada's history.

Tax-research consultant David Kersten, owner of Kersten Communications, still is compiling the report but says the big picture is clear. Numerous state exemptions allow local mines to only pay taxes on about a third of the value of the precious metals they extract. Kersten says they pay a state tax of just 5 percent on that smaller value.

"So, it really works out to just $71 million on a total of $6.6 billion in the value of what they extracted."

Mining industry lobbyists say the companies also pay the modified business tax and sales tax to the general fund. But Kersten says all businesses pay that, and thinks the state is too lenient about the mining tax. He compiled the report for the Progressive Leadership Alliance of Nevada (PLAN), which will present the findings to the Mining Oversight Commision on Thursday.

Kersten, who is updating the 2009 report called "Fool's Gold," says it shows that, while Nevada ranks near the bottom in taxing mines, the industry is enjoying record profits.

"Newmont called itself the 'Apple of gold stocks.' These companies, their profits are up 20 and 30 percent, even more - and compared to a few years ago, they have huge growth in profits and production."

Of the 13 Western states where mining is active, he says Nevada is all but alone in handing out such sizable tax breaks to the industry.

"Every other state except for Alaska taxes on the gross value of gold. Nevada's unique in that it allows all of these deductions."

We've known for some time that there's a real problem with Nevada's mining tax code. This week, we're being reminded of it again. No matter how much mining industry lobbyists try to spin it, it's real and it's costing our state.

Something's got to give. That's what Nevada voters want to see. But will it finally happen?

While it's typically been incredibly difficult for any kind of mining tax reform to survive in Carson City, it may not always be this way. After all, how can the overwhelming majority of Nevadans be ignored any longer? Can we really afford to keep waking up to deja vu?

Wither Tax Reform?

.@BrianSandoval's tax extension plan has neutralized support for tax ballot initiatives, mostly AFL-CIO's margin tax. No $, little support.

Ralston said it, so it must be true?

So has the tide already turned again? Just last month, it seemed like progressive tax reform was gaining steam... And scaring Governor Brian Sandoval's inner circle. And just last week, the Monte Miller backed mining tax initiative cleared a key legal hurdle in district court.

Throwing out a challenge by Nevada's mining industry, a judge ruled today the description being used to collect signatures to raise the constitutional cap on the taxing of mineral proceeds is within the bounds of the law and proponents can move forward.

District Judge James E. Wilson, Jr., said the description of the initiative was "straightforward, succinct and non-argumentative."

Nevadans United for Fair Mining Taxes, led by conservative businessman Monte Miller, has proposed raising the state's tax cap on minerals from the current 5 percent to 9 percent.

The group is working under a tight deadline — it needs to collect 71,000 signatures by mid-June to qualify for the November 2012 ballot. If it passes then, it would have to pass again in 2014 before being embedded in the constitution.

"Time on this is precious," Miller said.

Wilson's decision, which could be appealed to the Nevada Supreme Court, also allows the sponsors of the bill to have authorship of the quick summary that is at the top of the petitions waved by volunteers or workers in front of grocery stores.

But now that Sandoval has agreed to lifting the sunsets (again) on the 2009/2011 tax deal, and now that economic recovery is taking hold nationally and here in Nevada, his inner circle is hoping that any further talk of tax reform gets quietly swept under the rug. "Look here, no more cuts! No more cuts, so all is well."



As we discussed last week, it's certainly an improvement that Governor Sandoval is no longer interested in slashing public education to the bone and sucking all the marrow out of our schools. And yes, it's been quite fun to watch Brian Sandoval and Heidi Gansert take swipes at their former friends at NPRI and Muth-ville while also talking up the economic recovery we're seeing on President Obama's watch. However, we can't forget that Sandoval & Co. only want to stop the cuts. They don't want to reverse the damage done by the cuts, and they don't want to even discuss any kind of tax reform.

So now we're not supposed to even discuss real tax reform just because the Governor's Office says "no more cuts"? And we're not supposed to discuss real tax reform because our still chronically underfunded public schools, health care programs, and transportation infrastructure won't have their budgets slashed further? And we're not supposed to discuss real tax reform because we can "grow our way out" of noticing our continuing regressive tax structure that places the bulk of the tax burden on the middle class and working poor while allowing out-of-state mining corporations and "big box retailers" to pay next to nothing?

And folks wonder why Nevada's government can be so screwy...

It's the Schools, Stupid!

How many times have I had to say this? The Sun has yet another article pointing this out, and even Ralston is admitting the obvious on Twitter.

IT'S THE SCHOOLS, STUPID!

How many more times must I explain this? With inadequate schools, new companies won't move here. Businesses are now looking for a more educated workforce, and Nevada can't provide that with underfunded, overcrowded, underperforming, overburdened, and all around collapsing K-12 schools and colleges. Without good schools, we'll never have the foundation needed for a more stable economy and lasting jobs.

But do enough legislators understand this? Do they really want to continue being penny wise and pound foolish? Do they want to force Clark County School District to sue them for inadequate funding? Do they really want to "beggar thy neighbor" by forcing unfunded mandates onto local governments? Or are they finally ready to make a change and do the right thing?

Everything we "know" on the budget is wrong. The revenue is there. The mining industry can certainly afford to pay its fair share, and so can other large multinational corporations taking advantage of our consumer dollars while refusing to pay what we pay. Our system is broken, our state is failing, and we can no longer afford to ignore this crisis.



Bills like AB 428 must be passed this session. The mining industry must pay its fair share, and other large corporations must pay their fair share. Small businesses can't be forced to bear the burden of a collapsing state, and working class Nevadans can't afford to be taxed by way of the rising costs of failing schools and crumbling public infrastructure.



IT'S THE SCHOOLS, STUPID!

There's a reason why over 1,500 students from throughout Nevada, from Elko to Reno to Henderson, stormed Carson City last week. There's a reason why more and more business leaders are speaking the truth on the state of Nevada's schools. And there's a reason why mining industry lobbyists are now running scared. They all know the key to a successful Nevada is good education, and they all realize we must raise revenue in a fair and just manner to save our state. They also know we have the power to make it happen. Let's do it.

Mining in Nevada: The Henderson Democratic Club Forum

I have to hand it to the Henderson Democratic Club again... They know how to keep the fireworks going long after the Fourth of July! Last night, they hosted a forum on mining issues. Tim Crowley from Nevada Mining Association (NMA), Pete Dronkers from Environment Nevada, and Mr. Gleaner himself (Hugh Jackson) stepping in for PLAN all came to talk mining and give each of their own unique perspectives of what's wrong and what's right with the state's mining industry.

If we're to believe NMA, mining pays more in taxes than anyone else. "We pay 5% of net proceeds, and we are the only ones to do so," said Tim Crowley. He argued that other businesses only have an effective tax rate of 3.64%, while they have to pay a 5% tax rate on their net proceeds.

Crowley also said, "We don't oppose paying our fair share... It just has to be done in thoughtful way." He explained that NMA supports a broad-based corporate income tax (to be fair, that's even to the left of Steven Horsford!), but "don't single us out... Let's look at everybody."





Funny enough, Hugh Jackson started off in agreement with Tim Crowley on corporate income taxes... Then added, "It's not either/or. We should do both!" Jackson then argued that "all other states & countries have single industry specific taxation" in addition to regular corporate income taxes. He then described how the tax rate on paper may be 5%, but the effective mining tax after deductions is really 0.8%. Apparently, there have even been years when Barrick and Newmont (the two largest mining conglomerates doing business here) have paid ZERO in taxes. "The state general fund got about as much taxes from our great mines [in the last decade] as we did from rental cars," added Jackson. Even as gold prices and Barrick & Newmont profits hit record highs, mining still only paid $48 million this year... And after the mining industry sold $5.7 billion in minerals from Nevada in 2008, they only paid $40 million in net proceeds taxes to the state’s general fund.

So what's the solution on taxes? Is it fair to single out one industry, one industry that is the lifeblood of rural Nevada? But is it fair to give one industry so many tax breaks? What's the fair solution?

I posted some more of last night's forum on my Twitter @atdleft if you're interested. It certainly got me to think more about the state of our state, and where mining should fit in.