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NEVADA VIEWS: The problem with government by initiative petition

It’s election season. While the presidential race is occupying much of the conversation, you should be aware that the Clark County Education Association has proposed two ballot initiatives to raise more than $1 billion in new taxes that would negatively impact residents, visitors and businesses in Southern Nevada.

The first proposal is an increase to the gaming tax; the second proposal would boost Clark County’s sales tax to nearly 10 percent, making it one of the highest in the country. It would put tremendous burdens on working families, who would pay higher taxes on many goods such as clothing, shoes, school supplies and even cars. And it would have a chilling effect on visitor spending on retail items.

As petitions for these initiatives circulate, we urge you not to sign them. Here’s why:

Initiative petitions provide no opportunity for compromise, the consideration of unintended consequences or dialogue with those affected. Debating these proposals in the Legislature — where all voices can be heard, consequences can be considered and compromises can occur — is the best place for enacting good policies.

For example, in the Legislature, lawmakers can consider the implications of adding a significant new tax on gaming. The gaming industry is already the single most significant contributor to the state general fund and is the economic driver of the state. Is this a fair tax on our most important industry?

And in the Legislature, lawmakers can consider the impact of raising the Clark County sales tax once again. Clark County just increased its sales tax by one-eighth of 1 percentage point to support local education efforts. According to The Tax Foundation, Nevada currently ranks 12th-highest in the nation based on our state and local sales tax average. This proposal by the teachers union would saddle Clark County with one of the highest sales tax rates in the country.

Through the legislative process, lawmakers can consider whether a sales tax of nearly 10 percent would drive commerce away from the state, particularly with tourists and residents who may choose to purchase an expensive item in a neighboring state with a lower sales tax.

Increasing funding for education via the legislative process has proven to be successful. The Legislature has increased K-12 funding nearly every biennium over the past decade. In 2015, in collaboration with the Vegas Chamber and the business community, then-Gov. Brian Sandoval and lawmakers passed a new commerce tax along with increases to the modified business tax and state business license fees, which added $1 billion more to K-12 education every biennium. In total, we have spent more than $27 billion on K-12 education over the past 10 years through the state’s approved budgets, not including federal dollars.

And last session, lawmakers overhauled the Nevada Plan — the funding formula that allocates state dollars for education — after more than 50 years. This new formula will be utilized beginning in 2021, and, by all accounts, Clark County will receive a larger share of state funding. Teacher salaries and reimbursements to teachers for school supplies have also been increased. The Vegas Chamber, representing businesses in Nevada, has been supportive of these increases because we recognize the need to invest more into K-12 education. We were also supportive because these proposals were made and passed through the legislative process.

The Vegas Chamber has been opposed to initiative petitions in the past as they tend to be based upon sound bites, not sound policy. Open debate allows tax proposals to be considered from all perspectives in order to ensure that the burden is necessary and spread as broadly as possible. Legislative proposals can draw out all of the possibilities and bring in all of the perspectives to develop a consensus that is good for the state.

The governor and legislators are responsible for the entire state budget, including other challenges our state faces such as homelessness, mental health, roads and public safety. They should have the flexibility to debate the pressing needs of our state and determine how best to address them through the budget process. The Legislature is also the best place to address how much more money is needed for K-12 education, how any new funds would best be spent and how more revenue would improve K-12 outcomes.

K-12 funding is a problem that needs to be recognized but dealt with holistically and comprehensively. The adjustments need to be carefully considered. We at the Vegas Chamber are committed to working with Gov. Steve Sisolak and the Legislature on their efforts to fund education at the appropriate levels that aligns with the Clark County superintendent’s plan for student achievement and success.

We urge voters to not sign the teachers union petitions and instead allow these conversations to occur in the Legislature where they can consider if more money is needed for education, and if so, the fairest way to fund it that will do the least harm to our businesses, residents and visitors alike.

— Mary Beth Sewald is president and CEO of the Vegas Chamber. Hugh Anderson is chairman of the Vegas Chamber Government Affairs Committee.

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