Nevada state agencies want an $8.3 billion budget, but this would require a 59 percent tax increase - larger than the last two tax hikes combined. Such a large tax increase would make the recession in Nevada virtually permanent.
Senate Majority Leader Steven Horsford has made it clear he wants at least $1.5 billion in tax increases - sill the largest tax hike in state history. Such a tax increase will only serve to sustain our bloated spending at 2007-09 biennium levels (and about 2009-11 as well).
So what can we do? If history is any guide, be warned, tax increases are coming and I wouldn’t be surprised if it was $1 billion to $1.5 billion. But can Republicans, lead by Brian Sandoval, stick together long enough to get major concessions out of Democrats?
Democrats claim that everything is on the table, but what they really mean is that they want a tax increase, fund sweeps and accounting gimmicks to sustain our bloated government spending.
Republicans should take them to task over this claim – like calling for privatization of state services, spending limits, pension reform and more. In other words, seriously look at everything on the table before going to tax hikes.
Republicans should hold out and stick with the no tax mantra until Democrats can agree to the following:
- Roll back the state’s budget to a previous year – 2007 at latest but 2003 would be “best” (and this still keeps the Kenny Guinn tax hikes). Nevada actually increased spending at the beginning of the recession and barely made a dent in the budget afterward. Basic support per pupil even went up.
- Spending limits – limit total state government spending growth to population plus inflation. This will prevent or lessen the damage from future spending bubbles that lead to this mess in the first place.
- Pension reform – Create defined contribution plan for government workers rather than our unsustainable defined pension plan. This will reduce an already massive unfunded liability; estimated at $9 billion but is likely much more.
- Eliminate health insurance subsidies for retired government workers – this is already a $4 billion unfunded liability.
- Competitive sourcing – require state agencies to bid against the private sector to provide state services including landscaping, auto repair, HVAC repair, and even social services, health and welfare.
- Priority based budgeting – Nevada’s baseline budgeting results in our staee agencies treating tax dollars like an entitlement. Priority based budgeting forces government to look at available revenue first, and assign it based on priorities and agencies ability to meet goals set by legislature.
- Transparency – put the entire check book online in a searchable database. Let the people see if you’ve really cut to the bone or not.
- Government worker union reform – A) negotiations are subject to open meeting laws B) binding arbitration is outlawed C) government workers can no longer be protected by seniority or tenure (this means the worst employees, rather than the youngest or cheapest, can be fired).
- Education reform – A) statewide school empowerment and decentralization B) statewide open enrollment C) charter school institute (to regulate, oversee, and approve new charter schools) D) teacher evaluations and school grades E) end social promotion in early grades F) PARENTAL CHOICE – Republicans don’t have the votes but at the very least, Republicans can capture the moral high ground and call for scholarships for special needs and low income students.
- Sell non-essential state assets like Forestry Nurseries – seriously, why is the state growing plants when the private sector already operates several plant nurseries? Force local governments to sell their non-essential assets like golf courses, tennis courts, and gun ranges. Think about this for a second - the government is threatening to cut "essential" services while they still provide luxury perks like these. Sell the assets and sweep some of those funds.
- Freeze new public school construction (allow only new charter schools because their capital cost is paid for by the private sector). Why do this? CCSD was building new schools during the middle of a recession while they were losing students. Sweep some surplus funds from school districts. CCSD, for example, is sitting on $900 million – take $100-200 million before raising taxes.
- Look into leasing state highways. Indiana made $3.85 billion on a 40 year lease for a 157 mile long highway. Nevada could make at least that much for I-80 and I-15. The money could be used to prop up government spending to avoid making real cuts, refill our rainy day fund, and provide a tax rebate. We could even lower Nevada’s notoriously high gas tax since highway maintenance will now be done by the companies operating the highways.
Once all of that is complete, and there is still a budget shortfall, then look at raising taxes. But seriously, take a look at EVERYTHING on the table and don’t let Democrats (or the Las Vegas Sun editorial board) get away with empty rhetoric.