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For now, gaming, mining on outside as tax petitions take shape

For years, Nevada’s gambling and mining industries had a simple message about taxes: They wouldn’t support new or increased taxes specific to their industries alone, but they would support a tax applied equally to all businesses.

Now that the Nevada AFL-CIO is working to create a business margins tax aimed at doing precisely that, you’d think Nevada’s casinos and mines would be behind it. Thus far, however, neither industry is willing to back the union, because neither industry has been treated to a preview of the initiative — even though it’s reportedly ready to be filed in Carson City.

"What initiative, Steve?" R&R Partners’ Billy Vassiliadis asked when I called him Monday to ask about the Nevada Resort Association’s stance on the measure.

"We just don’t know yet," said Tim Crowley, president of the Nevada Mining Association. "We’re waiting for something to materialize."

Aren’t we all. AFL-CIO Executive Secretary-Treasurer Danny Thompson promised even before the 2011 Legislature that if lawmakers failed to pass a business tax, his union would take the lead in doing the job. Considering he directed the successful campaign to amend the Nevada Constitution to install a minimum wage that’s higher than the federal minimum, it was not an idle threat.

Thompson said Monday that the language of the initiative was still being finessed, but that the final draft would be vetted "in the very near future," both with his union membership and industries such as gambling and mining. "We’re going to talk to everyone who’s interested before we launch it," he said.

Until then, however, industry is understandably cautious. "Just by calling it ‘broad-based’ doesn’t mean that we’re going to support it," Crowley said.

Vassiliadis agreed: "I still think there’s a lot to learn before we find out what’s going to happen."

That includes whether the initiative can pass legal muster. Anyone can challenge an initiative by contending it’s unconstitutional, its description of effect is misleading or that it encompasses more than one subject. Many petitions have died in court before they ever saw a clipboard outside a supermarket.

And then there’s the reaction: Businessman Monte Miller has threatened to circulate tax initiatives targeting both the gambling and mining industries, a move widely believed to be in retaliation for breaking ranks and supporting higher taxes. At the very least, a bevy of initiatives could crowd the ballot and confuse voters.

"I’m a little shocked by that move," Crowley said of Miller’s plan. "I guess he thinks he can threaten us and we’ll respond by backing off a commitment we’ve never made."

Vassiliadis simply dismissed Miller’s plans: "It doesn’t factor into what the industry may or may not do."

Thompson, however, said he’s confident he’ll have the support of the state’s big players. "They’re the only ones who pay taxes now, and they know they can’t be the only ones," he said. But if they look at the final edition and don’t join? "I’m going without them," Thompson said.

Whether a business tax could pass without the support — or at the very least, without the organized opposition — of gambling and mining is an open question. What’s not as debatable is this: Given the opportunity to tax mining (a primarily rural industry) or gambling (a perennial tax target), voters would almost assuredly say yes. The same may not be true of business, especially with a well-organized campaign against it.

Thompson says he looks forward to having the debate with opponents, especially when it comes to the state of funding for Nevada’s K-12 public schools.

But before anything happens, we’ll need to see the actual initiative.

 

Steve Sebelius is a Review-Journal political columnist and author of the blog SlashPolitics.com. Follow him on Twitter at www.Twitter.com/SteveSebelius or reach him at (702) 387-5276 or ssebelius@ reviewjournal.com.

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