Nevada Democrats all but surrender hope for new taxes
CARSON CITY — Emotional Democrats all but surrendered hope for new taxes Tuesday as they dramatically slashed their state spending wish list.
The concessions, worth about $264 million, followed several hours of Democratic infighting but still weren’t enough to impress Republicans who support Gov. Brian Sandoval’s proposed budget, which calls for no new taxes.
“I feel sad and embarrassed,” said a tearful Assemblywoman Debbie Smith, D-Sparks, following votes to pare back proposed spending on teacher salaries, colleges and universities and medical aid to the poor. “I feel like I am giving and I am not sure I am getting.”
The concessions narrowed the gap between the GOP governor’s proposed budget and the Democrats’ desired spending level to about $704 million. Democrats face having to cut even more if Republicans don’t agree to delay the expiration of about $626 million in existing taxes.
Either way, with less than two weeks before the conclusion of the 120-day legislative session, it appears Democrats will be unhappy with the result.
Senate Majority Leader Steven Horsford, D-Las Vegas, refused to talk about the votes, which came during a joint meeting of the Senate Finance and Assembly Ways and Means committees.
“I don’t have anything to say,” Horsford said.
Sandoval, who was elected by a landslide margin largely on a promise to oppose tax and fee increases, originally proposed a $5.8 billion general fund budget for 2011-13 that included major cuts to K-12 and higher education and social services. He amended his budget to about $6.1 billion after an improving economy resulted in higher tax revenue projections.
Democrats, who are the majority in both chambers of the Legislature, opposed Sandoval’s cuts and earlier this month proposed a $7 billion spending plan of their own.
Their plan called for a new 0.8 percent tax on business revenue, a 1 percent tax on service transactions and delaying the expiration, or “sunset” of $626 million in existing taxes.
By reducing their spending demands Tuesday, Democrats acknowledged the new taxes are all but dead and pinned their hopes on making a deal on extending the sunset on existing taxes.
“I think it is pretty clear we are not going to get beyond sunsets,” said Assemblyman Tick Segerblom, D-Las Vegas.
Major concessions by Democrats Tuesday included a vote to cut teacher and other school employee pay by 2.5 percent, saving about $118 million; reducing K-12 per pupil support $100, saving about $85 million; taking back $20 million they proposed adding to the Nevada System of Higher Education; and reducing the amount they want to spend on Medicaid and Nevada Check-up by $19 million.
“The list is brutal,” Smith said. “I have not gotten anything. I have given up hundreds of millions of dollars.”
If Republicans were moved by the Democrats’ attempt to bargain they didn’t show it.
They voted in favor of motions that reduced spending to levels the Sandoval budget can cover and opposed offers that didn’t go far enough.
The only two Republicans who spoke were Sen. Ben Kieckhefer, R-Reno, and Senate Minority Leader Pete Goicoechea, R-Eureka. Each said he would oppose compromise offers that fall short of Sandoval’s proposal.
As recently as Tuesday Goicoechea had been leading negotiations with Democrats who were working toward trading long-term spending reforms for votes to continue the sunset taxes.
Compromise efforts came to a screeching halt, however, after Sandoval visited with Senate and Assembly Republicans.
The governor met with lawmakers behind closed doors and appeared confident they would back his proposal to balance the budget without new taxes or postponing the demise of the sunset taxes.
“We had a great meeting just now,” Sandoval said. “They have a budget they can adopt right now.”
After the meeting, Senate Republicans, who have so far refused to consider trading votes for any taxes, sent out a statement signed by each member saying they wouldn’t approve any tax deal.
The statement threw a wrench into negotiations between Assembly Democrats and Republicans, who had been working on a sunset deal.
“It is going to make it sticky,” Goicoechea said of the Senate statement, which places Assembly Republicans in the position of voting for taxes that are unlikely to pass. “We are not going to shoot ourselves in the head.”
While Republicans solidified, Democrats fractured.
Rank-and-file Democrats objected to the proposal by Smith and Assembly Speaker John Oceguera, D-Las Vegas, that they pare back their demands.
The Assembly Democratic caucus broke up with some — including Assemblywoman Lucy Flores, D-Las Vegas, and Assemblyman Kelvin Atkinson, D-North Las Vegas — refusing to support the compromise.
Eventually Flores and Atkinson came back to the fold, but the blowup delayed the meeting to approve the concessions for nearly nine hours.
Atkinson supported the compromise in committee but also seemed reluctant to meet other Republican demands.
“You can’t give up the farm for sunsets,” he said.
Although the session isn’t scheduled to conclude until 1 a.m. June 7, time is short to strike a deal that includes taxes.
The Legislature would need to agree to such a plan by Friday because they would need time to get the likely veto back from Sandoval and hold an override vote.
Contact reporter Benjamin Spillman at bspillman@reviewjournal.com or 702-477-3861.
