‘Betting on Nevada’

In 2004, the airwaves in Reno were filled with so many ads that the Biggest Little City in the World lived up to its moniker. For a time, the Reno television market featured more campaign ads per capita than any other.

Although the Nevada presidential caucuses early next year will no doubt push money into the paid media market, there’s already a free-for-all of issue advertising on cable in an effort to keep the state’s tax fever at bay.

The Nevada Resort Association’s “Betting on Nevada” campaign was launched this summer as a defense against what many suspected was coming — a ballot initiative to raise the gaming tax. Now that not just one, but two such initiatives have been announced, the gamers are hoping they can create just enough doubt out there to make a third initiative the most successful.

The marketing campaign, which includes radio, newspaper and Internet ads, hypes the fact that gaming supplies 48 percent of all state revenue and that Nevada has the fourth-best business tax climate in America. (Wyoming, South Dakota and Alaska are better, but who wants to move there?) Implied in this campaign is that gaming has unfairly been the top target and that big business in Nevada — including banks, developers and retailers — aren’t paying their fair share.

Talks are already under way to place a competing ballot initiative before voters next November, one that would undoubtedly increase the gross gaming tax less than either of the other two — a proposal by attorney Kermitt Waters to raise the top tier of the tax to about 18 percent and wipe out property taxes for owner-occupied homes in the process, and a state teachers union plan that would raise the tax by 3 percentage points to 9.75 percent.

If all three initiatives qualify for the ballot (which is always a question in Nevada), the one that passes with the most votes would win.

If the gamers have any hope of staving off the other two plans and winning at the polls, it only makes sense for their initiative to include a slightly higher gaming tax. After all, the industry knows it doesn’t have to worry about the Legislature next year. Even the term-limited lawmakers won’t have the gumption to hit the state’s top industry too hard, and Gov. Jim Gibbons is sticking by his promise to veto any tax increase.

There’s little doubt the teachers’ measure would get enough support to pass. A poll by Mason-Dixon Polling & Research for the Review-Journal pegs the public’s backing at about 70 percent. And there’s always time for the Waters initiative to pick up support, especially if voters see the gaming measure for what it is — a way to take over the ballot process.

More than two-thirds of Nevadans support raising the gaming tax at least 3 percentage points, and other industries are certainly taking notice. The Nevada Mining Association wants Las Vegans to know mining works for Nevada. It recently restarted a television marketing campaign that typically ramps up in the months or so before a legislation session.

Mining may be a less visible target, but it shares some of the same vulnerability as gaming. It’s been boom time for the miners, and the economies of some of the rural areas are recovering from past busts nicely. It doesn’t hurt to tell Southern Nevadans that mining is paying for schools. Gaming is already touting that it pays for one-third of K-12 education in the state.

The messages are a bit out of place, coming this soon on the heels of a legislative session. But these two industries can’t be too sure what the near future holds.

Gibbons was supposed to announce Monday how he intends to tweak the state’s budget now that sales tax revenue has dipped in the nation’s top foreclosure state. Instead, after a Cabinet meeting Monday, Gibbons’ team decided to ask departments to go back and see where they might be able to reduce some costs. After they report back, the governor will be in a better position to take steps to address the shortfalls, according to his press secretary, Melissa Subbotin.

With his no-tax pledge, Gibbons is in no position to do more than cut away at funding earmarked for certain projects. That could mean delaying money for the expansion of Interstate 15 or initiating a hiring freeze similar to the one Gov. Kenny Guinn put in place when he experienced his first shortfall.

Anyone who’s been here since 2001 knows how quickly the state’s economy can sour. And some economists are still predicting a national recession as a result of the foreclosure crisis.

But while the revenue may fall off here, the needs certainly won’t. Behind every foreclosure is a family that might require additional state services.

Any decision the governor makes to keep essential services humming will mean problems for what many Nevadans deem essential — from higher education funding to transportation or even something as simple as further delaying a decision on how to make public employee pensions and retirement health care benefits solvent.

In this climate, there’s nowhere for the gaming tax to go but up.

Erin Neff’s column runs Sunday, Tuesday and Thursday. She can be reached at (702) 387-3906, or by e-mail at eneff@reviewjournal.com.