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The Great Sandoval-Roberson Tax Hike of 2013

This just amazes me.

Reader’s Digest version of history: Brian Sandoval ran for governor in 2010 promising to roll back the state’s general fund budget to the 2007 pre-recession level of around $5.2 billion. Once elected, however, he proposed in January 2010 a general fund budget of about $5.8 billion. But no tax hikes…including no extension of the “temporary” tax hikes passed in 2009.

With me so far?

Now…in the beginning of May 2010, the unelected cardinals on the Economic Forum convened and determined that an improving economy would result in an unexpected $300 million windfall surplus of tax revenue for the upcoming biennium.

Now…did the governor reduce taxes by $300 – maybe a reduction in vehicle registration fees or sales taxes – to give individual citizens and/or businesses a break with the recession still going on?

No.

Instead he added $300 million worth of new spending over and above what he proposed in January…which was some $600 million more than he proposed as a candidate.

Now…three weeks later the Nevada Supreme Court determined that a $62 million funding “raid” of a Clark County water project by the state could not be used to balance the budget.

The decision only applied to the $62 million, but the governor assumed it would eventually apply to some $600 million worth of other booty raids from the locals. We disagreed with his assumption (so did Sen. Michael Roberson, a lawyer)…but let’s give the guv the benefit of the doubt on this one for argument’s sake, OK?

Now…did the governor say, “Well, now we have to cut $600 million out of the budget?

No.

Did the governor say, “OK, we at least need to rescind the $300 million in additional spending I added three weeks ago and we’ll extend $300 million worth of the ‘temporary’ 2009 tax hikes instead of extending a full $600 million worth of ‘temporary’ tax hikes”?

No.

Instead the governor decided to have his cake AND eat it, too.

He decided to spend the $300 million worth of windfall surplus revenue the Economic Forum gave him just three weeks earlier AND hiked taxes on businesses and the citizens of Nevada – which he promised NOT to do – by a full $600 million.

But only “temporarily” again. Those tax hikes, we were assured, again, would finally expire as promised – “And this time we really, really mean it!” – in June of 2013.

Alas, last week the governor announced he was going to break his word a second time by keeping the full $600 million worth of taxes he promised would go away in his budget.

And adding insult to injury, Sen. Roberson (R-Las Vegas) – who has signed the Tax Pledge and voted against the sunset extension last year – did a reverse-one-and-a-half-somersault-with-a-three-and-a-half-twist and embraced turning those sunset taxes into sunrise taxes.

Complete. Total. Unconditional. Surrender. All without a shot being fired.

Now, here…let me rub some salt into that open wound, OK?

On Friday, Jeff Mohlenkamp, the governor’s budget czar, issued a memo…in government-speak, “Policy Directive #D-2012-04”…to all state agencies relating to their 2013-15 budget requests. And wait’ll you get a load of THIS!

“The State economy has been showing signs of recovery and tax revenues exceeded the economic forum forecast for FY 2011,” Mohlenkamp wrote. “Revenues are also on pace to exceed the forum’s forecast during FY 2012.”

Got that? In other words, not only did Gov. Sandoval get a windfall of $300 million that he spent instead of using to replace the raided loot he had to give back, but the recovering economy is actually pumping even MORE than that $300 million windfall surplus into the government’s coffers.

Which means by this time next year it’s quite possible that Nevada’s recovering economy could very well replace the full $600 million worth of “temporary” tax hikes that are scheduled to expire in June 2013 without cutting a dime from the budget Gov. Sandoval proposed in January 2011 when he took office and adamantly declared no tax hikes and no sunset extensions (which is the same thing).

But instead of keeping his word and making the tough decisions on spending, the governor is taking the easy way out…at OUR EXPENSE.

But don’t worry…it gets worse!

The reason for going back on his word – for the SECOND time – according to Mr. Mohlenkamp, is that despite the recovering economy and despite so many people leaving the state because they couldn’t find jobs, demand for “safety net (welfare) services” has supposedly “increased dramatically and continued high demand is expected.”

Come on. There will ALWAYS be high “demand” by tax eaters for government services paid for by the tax payers. That’s the problem…and that’s the debate legislators SHOULD be having. Not on what taxes to raise, but on what spending is, in fact, a critical, legitimate government expense and then prioritizing it.

Conceding that there’s nothing left in the budget to cut without a fight may be expedient, but it sure as hell doesn’t fix the problem.

But hang on and grab your blood-pressure medicine before reading the final straw loaded onto this camel’s back.

Now, to be fair and honest, I don’t understand bureaucratese very well (who does outside of government?), so I might be completely wrong on my interpretation of what Mr. Mohlenkamp next wrote with regard to agency “targets,” but let me just reprint it here:

“All executive branch agencies must limit their agency request budget submissions to amounts listed in the attached General Fund target sheet. … These General Fund targets are…adjusted for pay-related reductions that sunset effective July 1, 2013. These reductions that have been added back include furloughs, pay rate reductions, suspension of merit salary increases, and suspension of longevity pay.”

WTF?!!

By the way, it was Mr. Mohlenkamp who underlined “that have been added back,” not me. And if I understand this correctly – the governor’s staff is free to correct me and I’ll issue a correction – here’s what this means:

To balance the current budget, taxpayer-funded government workers “temporarily” had to take some pay cuts and furloughs, as well as give up certain raises and bonuses. And those minor and necessary wage reductions were scheduled to expire on July 1, 2013…the EXACT SAME DAY the “temporary” tax hikes were supposed to expire.

So it appears to me – again, if I’m reading this correctly – the extension of the “sunset” tax hikes is NOT so much going to pay for “safety net services,” but to HIKE GOVERNMENT WORKER PAY!!

If this is true, the coming Great Sandoval-Roberson Tax Hike of 2013 is an even bigger outrage than the 2003 Mother of All Tax Hikes…which, allow me to remind you, then Attorney General Brian Sandoval sued to have imposed on us.

This is gut-check time for Republicans.

Are you going to stick your collective heads in the sand and pretend this isn’t going on? Are you going to keep your mouths shut because this injustice is being perpetrated by a fellow Republican? My party, right or wrong? Is being a good – what way the phrase Rick Santorum used? – oh, yeah…”team player” more important that standing up for your principles?

Aren’t there any Republican leaders willing to stand up to the governor and Sen. Roberson over this?

Um, never mind. Forget I asked. We know the answer.

But seriously…if it was a DEMOCRAT governor and DEMOCRAT legislative leaders proposing this crap, Republicans all across the state would be breaking out the pitchforks and torches by now!

And some Republicans wonder why so many former Republicans such as me are FORMER Republicans?