The state constitution won’t defend itself. That’s why Senate Republicans must go to court to challenge efforts by legislative Democrats to brazenly ignore the voter-imposed supermajority requirement for tax hikes.
On Monday, Democrats approved Senate Bill 551, an extension of the current Modified Business Tax rate. It was scheduled to decrease as a result of higher-than-anticipated revenues from the Commerce Tax. But despite a record tax take, Gov. Steve Sisolak’s budget proposal sought to kill the sunset.
The Nevada Constitution requires that any bill which “creates, generates or increases any public revenue in any form,” receive a two-thirds vote in both legislative houses. A bill that nixes the proposed tax reduction clearly “generates” revenue. That’s the whole point, after all.
Democrats have a supermajority in the Assembly, but are one vote shy in the Senate. So the majority leadership sought cover from the pliable attorneys at the Legislative Counsel Bureau, which provides legal advice to lawmakers. The LCB obliged with a nonbinding opinion declaring that extending a levy’s existing rate doesn’t trigger the two-thirds requirement. Democrats took that as a green light to approve the tax increase in the Senate by a simple majority.
It’s worth noting that the LCB reached the opposite conclusion in 2011, 2013 and 2015 regarding similar bills.
The LCB’s flip-flop was the result of political pressure rather than lucid legal reasoning. Democrats have long chafed at the two-thirds restraint, which Nevada voters twice approved overwhelmingly during the 1990s. The state’s political elite has sought to avoid or erode the mandate for decades.