Judge tosses petition to increase gaming tax

CARSON CITY -- A district judge on Wednesday threw out a petition that would have allowed the state to increase the gaming tax on casinos to 9 percent as early as 2015.

District Judge James T. Russell said the 200-word description for the Nevadans for a Fair 9 Percent Gambling Tax petition was misleading and cannot be circulated among voters.

Russell said that the petition description called for a 9 percent tax on all gross revenue earned by a casino, not just on gross gaming revenue. Under that language, the tax would have been imposed on restaurant and other sales of a gaming establishment, he said.

Las Vegas businessman Monte Miller, who is leading the move to increase gaming taxes from the current maximum of 6.75 percent, said he would correct problems in the description and resubmit it to the secretary of state's office. He said workers already collected about 500 signatures. They must be thrown out.

During the 90-minute hearing, Nevada Resort Association lawyer Matt Griffin said the error in using gross revenue instead of gross gaming revenue was a
$1 billion mistake.

Griffin also said the petition said the tax applied to "unrestricted" gaming licensees instead of "nonrestricted" licensees, as larger casinos are known by under Gaming Control Board regulations. He said the petition would allow the tax to be collected from gaming manufacturers and distributors, which are not covered by the current tax.

Russell agreed with Griffin's arguments.

Miller's lawyer, Maggie McLetchie, called the description problems "small errors and small technicalities" that the judge could have corrected. She said the argument over the use of "un-restricted" or "nonrestricted" was ridiculous.

"It means the same thing," she said. "There is nothing in the law that says you can't use laymen's terms."

McLetchie argued that the petition's intent was clear to citizens signing it and that the Nevada Resort Association simply was doing everything in its power to prevent it from being circulated.

She expects the resort association will file another legal challenge against the petition after it is refiled by Miller.

Miller's petition proposes changes to an existing state law. If he gathers 72,352 valid signatures by Nov. 14, the proposal would be considered at the Legislature in 2014.

Legislators would have 40 days to decide whether to increase the gaming tax to 9 percent. If they take no action, the matter would go before voters in the fall 2014 general election.