Higher taxes the only real answer

Several events Tuesday amplified the state’s budget issues so well, it’s hard to imagine anyone still holds the belief that growth pays for itself and we can cut our way out of deficits.

The Las Vegas Valley Water District argued it needed to raise rates to help Nevadans “conserve” water. Watching water bills jump drastically could lead residents to use less water.

But district General Manager Richard Wimmer made it clear during a meeting of the board of directors Tuesday that the increased revenue generated by the higher rates (expected to be about $65 million) won’t be used for anything specific.

Valley water boss Pat Mulroy then deflected a question about the planned rural pipeline, saying the rate money can’t be used for capital projects.

At some point, someone’s going to pay for the pipeline — the projected cost will be hitting the Bs (that would be billions) of the state’s transportation shortfall.

Assuming the district shoves half of the new revenue into reserves, that’s money available to help leverage bonds to tap into White Pine County’s water and pump it here.

The average water bill increase, effective right around tax time, will be 23 percent. A citizen’s committee convened to study the pricing suggested the rates be raised three times to avoid a single whopping increase.

Some in the “environmental community,” as County Commission Chairman Rory Reid labeled them, suggested rates go even higher. If a 23 percent increase is a carrot for conservation, whatever would constitute the stick?

This rate increase wasn’t couched in terms of raising revenue, but rather as a way to spur people to use less water. Just imagine the bill when that revenue actually does become necessary.

Elsewhere Tuesday, state lawmakers met to again consider how to pay for the growing transportation needs of the north and south. The deficit between projected revenues and the amount needed projects will cost to build now stands at an impressive $6 billion.

State Transportation Director Susan Martinovich told an interim legislative panel Tuesday that lawmakers must find $450 million in each of the next eight years to pay for bridges, road widening and alternative routes.

That’s $450 million the 2009 Legislature won’t be able to cobble together with existing funds. The governor will use rainy-day funds to offset the current budget shortfall, and there’s no end in sight to the downturn in sales tax receipts.

So as much as no one likes the big “T” word, there’s no real alternative any more if we hope to pull together that much cash each year and do things such as widen Interstate 15, the lifeline of our tourist economy.

Yet lawmakers sit in fear of the Promise Keeping governor who won’t permit taxes on gas, truck hauling miles or even toll roads. Transportation consultants came up with several ways to address a $3.8 billion deficit back in 2005. But the no-taxing governor and a feckless Legislature did the barest minimum to address the issue. Now the transportation deficit is a legitimate beast which will only keep growing.

Here in Clark County, the road picture is no better.

Sales tax revenue is down so sharply that the Regional Transportation Commission doesn’t have enough money to fund interchanges and bridges needed to complete the Las Vegas Beltway. The price tag is a mere $1.4 billion. Chump change compared with the state deficit, but damning to the Clark County coffers, which have been hit not just by the dip in tax revenue, but also by the 2007 Legislature’s “solution” to the green tax fiasco and, ironically, to the effort by lawmakers to put down $1 billion on the state’s road deficit.

The local transportation solution appears to be a long-term bond in an economy where Warren Buffett needs to insure the bond insurers.

No matter where you look, the state’s infrastructure needs are crippling local and state governments. And that doesn’t even include education, health care or social services, which all continue to be ranked so low that Nevada can keep its derisive label as the Mississippi of the West.

Lawmakers of both parties insisted taxes aren’t possible in this economic climate and with this governor.

Yet there was state Sen. Bob Beers, a Republican up for re-election this year, telling the Review-Journal he’s the one to represent Las Vegas in Carson City because “a small group does want to kick Nevada families when they’re down by raising taxes.”

Could he mean Democrats? Or Republican state Sen. Dennis Nolan, who’s calling for a bipartisan tax plan to solve the transportation mess? Surely he can’t mean his Democratic opponent, Allison Copening, a PR official with the Las Vegas Springs Preserve, who announced she’ll run against Beers this year.

It’s much easier to rail against taxes than to provide solutions.

Contact Erin Neff at (702) 387-2906, or by e-mail at eneff@reviewjournal.com.