By Ray Hagar, Nevada Newsmakers
The Nevada Legislature will seek to increase funding for education with a two-pronged approach — redirecting all marijuana tax money to schools plus authorizing county commissions to consider raising the sales tax for public education or sending the issue to a vote of the people.
What was not discussed was raising Nevada’s gaming tax, said Senate Majority Leader Nicole Cannizzaro, D-Las Vegas.
“I don’t know if we have had those specific conversations,” Cannizzaro said on Nevada Newsmakers. “Like I said, the primary thing that we have focused on is ensuring the marijuana tax money, which we need for education, went to education.”
Cannizzaro also said she has not had discussions with county commissioners on the possibility of raising the sales tax for education.
“I have not talked to county commissioners,” she said. “What I can say is that we, as a state, have to have a real conversation on how we fund education and I think you are seeing that conversation take place at the Legislature.”
Lawmakers have been wary in the past about targeting a single industry like gaming for a tax increase, although Nevada’s gaming tax rate is considered low by national standards.
Nevada taxes gross gaming revenues at 6.75 percent, although the effective tax rate is considered at 7.75 percent because of added fees. Nevada’s casinos and resorts also pay a laundry-list of other taxes, including business and payroll taxes, sales taxes, liquor taxes and cigarette taxes. Taxes from the gaming and resort industry currently pay nearly 39 percent of the general fund budget, according to the Nevada Resort Association.
Cannizzaro would not speculate on the possibility of Senate Minority Leader James Settelmeyer, R-Minden, taking legal action if the Democrats in the Legislature try to extend portions of the Modified Business Tax (payroll) with a simple majority vote. That extension of about $100 million would be needed to balance Gov. Steve Sisolak’s proposed budget.
Nevada law states that new taxes or increased taxes need a super-majority vote from the Legislature. However, the Legislative Counsel Bureau, which gives legal advice to lawmakers, has ruled that a two-thirds or super-majority vote is not necessary to extend the payroll taxes.
Republicans contend the extension of the payroll tax is a new tax and therefore needs a super-majority vote. Settelmeyer has promised legal action if Democrats try to pass a budget that includes the payroll-tax extension with a simple majority vote.
“We know that we don’t need two-thirds for the vote,” she said. “What would happen in the future, I can’t speculate as to whether there would be challenges or not.”
Cannizzaro, however, does not doubt Settelmeyer’s word.
“I am sure that if he says he wants to institute legal proceedings, that would be the case,” she said. “I am hopeful we will all work together to ensure the money we need to fund education, to fund our teachers, is a priority for them as well.”