GOP’s Raggio holds the key to tax increase

CARSON CITY — By the numbers alone, this legislative session is likely to come down to one thing: what Bill Raggio wants.

Sure, the Democrats have the majority in both the Assembly and the state Senate. But it is Raggio, the Reno Republican senator who is the longest-serving legislator in state history, who has all the power.

That’s because it will take a two-thirds vote of both houses to pass a tax increase and then to override a gubernatorial veto, which Gov. Jim Gibbons has promised to supply once that tax increase comes to his desk.

Democrats make up two thirds of the Assembly, but just 12 of 21 votes in the state Senate. They will need two Republicans to join them to reach two thirds.

Raggio holds the key to those Republican votes. The 82-year-old minority leader is a moderate who has faced his last election under term limits.

So what does Raggio want?

“The same thing everybody wants,” he said in a recent interview. “We’re dealing with the most serious financial crisis this state has had in the time I’ve served in the Legislature. … We have to concern ourselves with how we get through this next biennium and meet essential services, and at the same time not impose unrealistic, unfair financial burdens on the people that have to pay the cost of it.”

Raggio downplayed the notion that it’s all in his hands.

“I’m the minority leader. My job is to get a bill to consensus within the Republican caucus,” he said. “That will be what I and others will do. We keep our caucus fully informed; eventually, there will be a consensus in our caucus, and that’s how we’ll vote.”

Democrats could get to the magic 14 state Senate votes with the help of Raggio and just one more Republican, likely Randolph Townsend, R-Reno, Raggio’s longtime lieutenant. But Raggio said he wants to see a plan with broader support.

“They’re not just going to peel off two Republicans to vote for any of these issues,” he said. “It’s not going to work that way. We’re going to build a consensus in our Republican Senate caucus, and that will be the basis on which any votes will be cast.”

After three months of legislative work, lawmakers are coming down to the wire.

The deadline to end the session within the 120-day limit is June 2. But once lawmakers send a budget to the governor, he has five days to either sign it, veto it, or let it become law without his signature.

Legislators fear that if they don’t get Gibbons a budget in time, the clock could run out before he’s acted on the bill, and they won’t be in session to override his veto. Only the governor can convene a special session and set its agenda.

Thus, lawmakers want to get Gibbons a budget in plenty of time for him to veto it and allow them to override the veto. Including time for processing, legislators have said that means they’ll have to pass the budget by May 21.

The possible dimensions of the budget compromise have been largely kept under wraps. Gibbons has criticized legislators of both parties for negotiating largely behind closed doors, without putting a formal proposal before the public to raise taxes.

Lawmakers spent the last week trying to come to agreement on major spending areas, approving cuts smaller than Gibbons proposed to state worker salaries and benefits and K-12 education. But after hours of private meetings, they failed to come to agreement on the higher education budget. It is scheduled for hearing Monday afternoon, putting the legislators behind schedule.

Once spending has been tentatively agreed upon, lawmakers will see how big the gulf is between that number and the amount of revenue the state is projected to take in over the next two years. Legislative observers believe it will be over $1 billion.

They will get the money through a combination of creative accounting, tax hikes and possibly further cuts. Raggio acknowledges that taxes will be part of the solution, but says they will have to meet certain criteria.

“Once we fill some of the holes that are now in the governor’s budget, and add back what we think are required for essential services, that will give us an amount that we have to fund,” he said. “To the extent that those funds aren’t here, then we’re probably going to be looking at some enhanced revenue. That’s difficult to do, because businesses are hurting, people’s incomes are down, people are losing jobs. We’ve got to have that in mind.

“So whatever enhancements to revenue — tax increases — are required, we’re going to have to be mindful that they’re going to have to be spread fairly, and as minimal as possible. … I can’t give you today where we’re going to look for increased revenues, but I do have some criteria personally, and I think our Republicans who are in the Senate feel these are our concerns and limits. I don’t think we’re going to be looking at new taxes. We’ll be looking at existing revenues, and we’ll be looking at minimal increases, because a lot of people think any time you put a tax in that it’s never going to go away.”

Any tax increase this Legislature passes, he said, will have an automatic expiration date built into it — a so-called “sunset clause.”

“One of my strong suggestions is that they will have to sunset,” he said. “They will be for this biennium, till we get through this financial crisis, and then they will sunset. Next session, we’ll have to revisit it. If the economy’s improved and we don’t need them, then they’ll be gone.”

In 2008, Raggio fended off a tough challenge from a right-wing former assemblywoman, Sharron Angle, in the Republican primary in his Reno district. During the campaign, he said he opposed raising taxes.

That he has changed his tune has drawn criticism from anti-tax activists such as Chuck Muth, the Las Vegas conservative who has taken to calling this session’s impending deal “the Raggio Tax Hike.” Raggio said he remains at heart a conservative, but not an absolutist.

“I believe in some fundamental things,” he said. “I believe in free enterprise. I believe in fiscal responsibility and in limited government. I know there are those who say otherwise, but I consider myself a Reagan conservative. … I also believe that government should be lean, but it shouldn’t be mean, and that you need to have concern and compassion for people who can’t provide for themselves and their families.”

He won his own election, but Raggio lost the majority when two incumbent Republican state senators in Southern Nevada were defeated. Many who have spoken to Raggio since the election report that he seemed more relieved than dismayed to relinquish the responsibility that comes with the majority position. Raggio likes to point out that of his 37 years in the Senate, 14 were previously spent in the minority, “so it’s not a new situation.”

Raggio also clearly has an eye on his legacy. Under term limits, he will still be in office for the 2011 legislative session, but then his time will be up.

“My role is as a senator who’s in his last term, who’s served here for now 37 years, who wants to do what’s right for this state and what’s essential for this state and what’s in the best interest,” he said. “That’s my concern. I don’t have any other purpose. I’m not running for higher office. I don’t have any political ambitions, and my name is never going to be on a ballot again. So I’m going to do precisely what is necessary in the best interest of the state. That’s what I was elected to do, not to represent my party or any special interest group.”

But Raggio disagreed with the notion that despite his minority status he continues to hold the reins of the legislative process.

“I’m one vote and one voice, and I’ll try to be persuasive,” he said.

Contact reporter Molly Ball at mball or 702-387-2919.

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