Sandoval, Democratic legislators both inflexible on taxes

CARSON CITY — When state Sen. Floyd Lamb ran the Senate Finance Committee 30 years ago, he bragged that his ability to get things done depended on knowing when to hold and when to fold.

Today’s Democrats might pay attention to the old cowboy from Las Vegas.

They don’t even have their own tax and budget plan, but their leaders remain resolute that taxes will be increased by an as yet unknown amount before the session adjourns June 6.

Republicans are just as uncompromising in their support of Gov. Brian Sandoval and his continued vow not to raise taxes.

After Sandoval told a Las Vegas business audience Tuesday that he "won’t trade taxes for anything," re-energized Republican leaders emphasized they intend to back Sandoval regardless of how loudly Democrats howl.

The governor asserted his opposition to making any deal at the same time Assembly Republicans were generating attention by offering to support extending $800 million in temporary tax increases if Democrats would back public employee collective bargaining changes and other reforms.

The governor’s strong words, along with the Democrats’ refusal to give on collective bargaining, have brought an abrupt end to compromise moves.

"I think they understand that the worst thing we could do right now is to raise taxes," Sandoval said of Republicans in the Legislature who will have to approve deep spending cuts to back him.

The governor appears more confident than ever that he will prevail. In his Las Vegas speech, he explained why he would refuse to make a deal on taxes.

"We should hold the line on taxes. We should reform the way we do business. And we have to reform the way that we educate our kids. I don’t think those are things you trade."

Unless at least a couple of Republicans in each house break ranks and vote for higher taxes, Democrats’ hopes to better fund public schools, higher education and other state programs are doomed.

Unlike Lamb, a Democrat in an era when Democrats outnumbered Republicans in the state Senate by laughable margins, Democrats operate at a time when they need a two-thirds vote in both houses to increase taxes. They hold an 11-10 margin over Republicans in the state Senate and a 26-16 margin in the Assembly.

So isn’t it time the Democrats talked about folding?

"Not at all," said Assembly Speaker John Oceguera, D-Las Vegas. "The process is going as it usually does."

After the Economic Forum meets on May 2, Oceguera said legislators will know how much tax money will be available for state government to spend over the next two years.

Shortly after that date, he expects the Senate Finance and Assembly Ways and Means committees will finish changes to Sandoval’s budget proposal, and only then will the magic tax increase number finally be uttered.

But state Senate Minority Leader Mike McGinness, R-Fallon, said it already is too late for Democrats to come forward with their tax and spending plan. He said his caucus isn’t going to budge in the final 56 days of the legislative session.

"The governor has a balanced budget that we are supporting right now and I think on June 7 also. Today we have a super-minority in both houses and more clout. That wasn’t true in the Senate two years ago."

SANDOVAL IS THE DIFFERENCE

McGinness said one of the biggest differences in this year’s tax discussion is the high regard that members and the public hold for Sandoval.

"Sandoval meets with us at least every week," McGinness said. "He meets with all legislators. The guy sure knows how to work a room."

The new governor’s growing confidence and finesse as he nears his 100th day in office on Thursday were on display in Las Vegas at the annual lunch for the Keystone Corp., a conservative business group. Wearing a permanent smile and cowboy boots along with a dark business suit and tie, he shook every hand and posed for pictures like a political rock star.

His energy and enthusiasm stand in contrast to former Gov. Jim Gibbons, whose staff couldn’t always find him.

When Gibbons was governor two years ago, Democrats managed to pick up enough Republican support to approve $800 million in temporary taxes over this veto. Gibbons was plagued by personal problems, feuded publicly with Democrats and seldom ventured into the Legislative Building to try to win fellow Republicans over to his thinking.

Other than the governor’s veto power, Sandoval and Republicans would have no power over taxing except for Gibbons’ constitutional amendment, passed by 73 percent of voters in 1996, requiring a two-thirds majority in both houses to increase taxes.

The other big difference from the 2009 session is that Bill Raggio, R-Reno, is no longer the state Senate Republican leader. The 84-year-old lawmaker retired before the end of his last session, citing health reasons.

Raggio, a moderate, voted for the tax increases two years ago, as did his closest ally, state Sen. Randolph Townsend, R-Reno. Townsend was prohibited by the term-limits constitutional amendment from seeking re-election.

Last summer, Raggio also warned that additional tax increases would be necessary again in 2011 because the state budget already had been cut too severely.

Even before his retirement, the Senate Republican caucus, which includes several far more conservative members, replaced him with McGinness.

Greg Brower, Raggio’s Washoe County Commission-appointed replacement, reiterated last week that he will not back tax increases.

After talking with Sandoval earlier this session, veteran state Sen. Dean Rhoads, R-Tuscarora, said he would not back tax increases. Rhoads voted for them two years ago.

Senate Revenue Chairman Sheila Leslie, D-Reno, sees another difference in Republican attitude this year. She said Sandoval and Republican legislators are following the talking points of the national Republican Party.

"They seem to believe it is their moment to draw a line in the sand," she said. "The governor works harder (than Gibbons). He meets with people. I am not sure he listens."

GOP DISSENTERS SOUGHT

Leslie, Oceguera and state Senate Majority Leader Steven Horsford, D-Las Vegas, still are convinced that at least a few Republicans can be persuaded to back tax increases once they listen to their constituents and realize the devastating efforts of their cuts on education.

People even stop her in supermarkets to complain about how the cuts will hurt them, Leslie said.

"I am listening to the overwhelming response of my constituents who say they want a balanced approach," Horsford said. "When you ask teachers and nurses and correctional officers to take a 5 percent pay cut, and for teachers it is more like 10 percent, it is a tax on them."

Sandoval’s proposed $5.8 billion budget is $400 million less than current spending, although both Horsford and Oceguera believe it is $2.5 billion short of the state’s real needs.

Sandoval calls for a $200 million, or 6 percent, cut in state support for public education and a $162 million reduction in state support to higher education. That equates to a 16 percent reduction next fall and a 29 percent reduction in 2012.

The Clark County School District already has rolled out a plan to lay off 1,834 teachers and other workers.

Assembly Minority Leader Pete Goicoechea, R-Eureka, said he does listen to his constituents.

"Stores are closing. Businesses have gone out of business," Goicoechea said. "Teachers are going to have to take a cut."

"I have been hearing from business people who closed their businesses and used their savings to meet payroll," McGinness said. "Things aren’t good out there. We can’t just focus on people who want us to fund their programs. We should look at people who fund those programs."

CRITIC: NO MANDATE

Eric Herzik, a political science professor at the University of Nevada, Reno, contends Sandoval has no public mandate to cut education spending and pass the buck of providing services down to the counties.

He and Truckee Meadow College professor Fred Lokken point to a late March poll by Nevadans for Nevada, a group representing labor unions, that showed the governor’s popularity rating in the mid-30s.

Eight percent of respondents thought Sandoval was doing an excellent job as governor and 29 percent a good job. Only 14 percent thought he was doing a poor job, while 15 percent had no opinion and 34 percent rated him fair.

A Nevada Retail Association poll in mid-February found a slight majority, 52 percent, said they supported tax increases in lieu of cutting education spending.

That same poll, however, found 55 percent of respondents trusted Sandoval, compared with 31 percent who said they trusted the Legislature.

"When the people of Las Vegas, Reno and Henderson ask, ‘Why are mental patients roaming my street?’ I would tell them to call the governor," said Herzik, a registered Republican.

He was referring to Sandoval’s plan to save $6 million by shifting the cost of mental health courts to the counties.

BLAME AND UNCERTAINTY

Lokken blames legislative Democrats for failing to make a stronger case on what budget cuts will do to education and social programs.

"They have had half a session to make their case, and they haven’t offered an alternative," he said.

But he doubts the "monolith Republican position" will continue to the end of the session. Redistricting decisions must be made by legislators and that might force Republicans to deal with Democrats, he added.

Herzik also believes some Republicans, after listening to their constituents, will at least allow the temporary tax increases to continue.

"How long will the Republicans hang with the governor at the cost of their constituents?" he asked. "What does (Sen.) Dean Rhoads owe Brian Sandoval? What does (Sen.) Ben Kieckhefer owe Brian Sandoval?"

Kieckhefer, R-Reno, is a former news reporter and press secretary to Gibbons and spokesman for the state Department of Health and Human Services. Kieck­hefer said he always has been a firm no on taxes.

"I am listening to my constituents. My district is strongly Republican, and I ran on a campaign platform that I would support a budget built on existing revenues."

Review-Journal reporter Laura Myers contributed to this report. Contact Capital Bureau Chief Ed Vogel at evogel@reviewjournal.com or 775-687-3901.