Are we finally going to talk about CCEA’s billion-dollar sales-tax proposal?
It looks like Nevada voters will soon be asked to decide if we want to have the nation’s highest average sales tax.
In 2020, the Clark County Education Association (CCEA) began collecting signatures in support of a pair of tax hikes that would total more than a billion dollars — one of which would push up the state’s weighted average sales tax rate to a national high of nearly 10 percent. Despite the economic turmoil of the COVID shutdowns, CCEA managed to acquire enough signatures to force the Legislature to entertain the proposals, lest they be put on the ballot in the following election.
Under Nevada law, initiatives which successfully garner the requisite number of signatures will land on the next election cycle’s statewide ballot… unless the Legislature adopts the policies therein, verbatim, during the legislative session. Of course, given that Democrats didn’t control two-thirds of the Legislature, it was pretty much a foregone conclusion that these issues would land on the ballot.
However, that result could still be used as leverage.
As the session came to a close, Democrats and the CCEA offered to withdraw the petitions from the 2022 ballot in a deal aimed at encouraging enough Republicans to give their support to a smaller (and less economically damaging) tax on the mining industry.
The plan worked well. And, as a result, Democrats largely got what they wanted: a revenue increase for education without the hassle of debating a massive and controversial tax on ordinary Nevadans.
Not unlike their supposed “non-tax” of 2019, however, it seems leadership might have been too clever by half. Last week Republican Secretary of State Barbara Cegavske announced that, despite the Legislature’s attempt to allow the withdrawal of these proposals, her office had a constitutional obligation to submit the initiatives to voters anyway.
The Las Vegas Review-Journal reported that Cegavske told the attorney general’s office “the Nevada Constitution requires the Secretary of State to follow a procedure once an initiative petition has obtained the required number of verified signatures… As such, a statute cannot interfere with that duty.”
As a Republican who is undoubtedly opposed to the idea of a billion dollars in new taxes, it would have been politically tempting for Cegavske to simply concur with an opinion issued by Attorney General Aaron Ford’s office that the petitions be withdrawn. However, just as she resisted the populist GOP hysteria over voter fraud last year, she is once again demonstrating a sober respect for the boundaries and obligations of her public office. Rather than relenting to political pressure, she has remained loyal to her understanding of the Constitution and law.
Barring some successful legal challenge, what this means is that a debate over imposing a billion-dollar sales-tax increase will take place after all — the late-hour political maneuverings of the 2021 legislative session notwithstanding.
There are plenty of reasons to dislike the notion of hiking sales taxes—even if more funding alone actually could correct the woes currently plaguing Nevada’s system of public education. Even before the pandemic, Nevada ranked near the bottom for private-sector median income earnings. And now, we’re facing stubbornly high unemployment rates and steadily increasing price inflation.
As a result, an inherently regressive sales-tax increase would disproportionately burden the Nevadans who have the fewest financial resources—hardly the kind of redistributionist theory that progressives usually embrace.
Many in the Democratic Party seem to agree—at least implicitly. After all, it was Democratic leadership, working with a handful of Republicans and the CCEA, who arranged a backroom deal to replace these burdensome taxes with a much smaller and less damaging tax against the mining industry. At minimum, the lawmakers who struck that deal did so because they felt the political advantage of such a compromise was more valuable than putting a controversial tax question to the voters — which is hardly a ringing endorsement of CCEA’s initiatives.
Even CCEA seemed far more interested in the leverage it could gain than the actual proposals themselves. The union’s willingness to withdraw its petitions was a tacit admission that the entire spectacle was little more than an extortion tactic to motivate Democrats, and cajole enough Republicans, into supporting some sort of politically palatable alternative.
Unfortunately, that pesky Constitution has a habit of interfering with such political maneuvering. Now, Nevadans are stuck with both the “compromise” and the looming possibility of a tax increase so politically toxic that lawmakers from both parties were eager to avoid its discussion during the session.
Cegavske’s reading of the constitution is unlikely to make her many friends in today’s political climate, however, pleasing the political preferences of elected officials isn’t her job. (And constitutional requirements are similarly dispassionate to such considerations.)
For voters, the inclusion of the tax hike question on the ballot might actually prove to be a gift of sorts, the risks of its passage notwithstanding. After all, should ordinary Nevadans be expected to vote directly on such a proposal, its merits might actually have to be debated, discussed and considered in front of—and among—the very people it would directly impact.
And those discussions generally lend themselves to more transparency than the political shenanigans that take place during the final days of the legislative session.
Michael Schaus began his professional career in policy and public commentary over a decade ago, working as a columnist, a political humorist, a radio talk show host and, most recently, as the communications director for Nevada Policy Research Institute. In 2021, Michael founded Schaus Creative LLC, a creative branding and design agency dedicated to helping organizations, businesses and activists tell their story and motivate change. Follow him at SchausCreative.com or on Twitter at @schausmichael.