Mining’s commitment to Nevada
February 24, 2010 - 12:00 am
As the Nevada economy continues to falter and we embark on a special session of the state Legislature, Nevada’s mining industry shares everyone’s concern for the state’s future in this unprecedented fiscal crisis. There has been a lot of commentary about the role Nevada mining should play in helping the state overcome our current challenges. We would like to take this opportunity to publicly outline exactly who we are, and how we are prepared to do our fair share, just as we have always done.
Mining employs more than 14,000 Nevadans in the production of gold, silver, copper, molybdenum, gypsum, lime, lithium, geothermal energy and more. Beyond the processing of precious metals, we provide the minerals that are essential to producing the wallboard that is in your home, the cement that is used in all areas of construction, and we are leading the way in making Nevada a global leader in the production of renewable energy.
There are an additional 50,000 Nevadans employed indirectly through the industry’s supply chain. The industry’s vendors and service providers include equipment wholesalers in Henderson, engineering firms in Reno, security specialists in Las Vegas, machinists in Elko, soil laboratories in Sparks and many geologists living throughout the state.
There has been a lot of commentary recently focusing on our tax contributions to the state. Unfortunately, either willfully or accidentally, our tax contributions have been repeatedly misrepresented by focusing only on the portion of our industry specific tax that goes to the general fund, which ignores the vast amount of our actual tax contributions. The facts are Nevada’s mining industry paid $131 million in conventional business taxes in 2008, plus an additional $90 million in industry specific property taxes.
In total, mining’s tax contributions averaged nearly $16,000 per employee; far more than any other business in the state.
Mining is one of only four industries in Nevada to pay an industry specific tax, in addition to all of the same conventional taxes paid by every other business. The Net Proceeds of Minerals Tax is a property tax assessed on ore bodies at four times that of the conventional property rate. Every other person or business in the state pays 3.64 percent of the assessed value on only 35 percent of their property; whereas, only mining has a property tax rate of 5 percent of the assessed value on 100 percent of our property.
But as I said, we recognize the depth and severity of our current fiscal crisis, and we are willing to do more. We appreciate the impact the proposed cuts will have and take seriously our obligation to help sustain services, especially within the communities where our employees live and work.
— Mining is willing to again consider advancing payments of Net Proceeds of Minerals Taxes to help sustain the state’s finances.
— Mining already pays fees to support the Divisions of Minerals and Environmental Protection, and other state agencies. We are willing to consider paying fees for additional mining-related state services.
— Mining has long supported a broad-based business tax and is open to pursuing changes that stabilize the revenue streams, as opposed to compounding Nevada’s fiscal crisis with new industry-specific fees falling only to a few.
Modern Nevada mining has worked to be a good corporate citizen in the state. We have stepped up repeatedly to help the state on fiscal, energy, social and other important issues. We pay family-sustaining wages and provide needed infrastructure — physical and social — in the counties where we operate. We provide support for numerous charities in urban Nevada where we have few employees.
The state is in an unprecedented budget crisis, and the solutions to restoring essential programs and services won’t be simple. But we firmly believe that the state’s business community must work with our state’s leaders to find balanced, broad-based solutions that stabilize our revenue streams and set a course for renewed prosperity. That is what we are committed to doing, and as always, mining is ready to do our fair share.
Tim Crowley is president of the Nevada Mining Association.