Mo' Money
Inside Liberty Watch Today - November 6, 2006

By Doug French

With concerned voters waiting breathlessly to learn what was on the Gibbons/Mazzeo garage tapes-"I think I saw a puddy cat, I did, I did"-so as to make the "informed" decision about who to elect as Governor-that wasn't one of Jane Ann Morrison's 54 cats was it-more enlightening news about the direction of state government was tucked away safely off the front page of the Las Vegas Review-Journal last Friday.

The state Economic Forum, a group of businesspeople from the taxpaying sector, took their preliminary wild-ass guess that determines how much money the state can spend over the next couple of years. And the verdict is that Nevada's general fund is going to rake in just short of $7 billion in tax revenues from individuals and businesses over the next two years. They 
will finalize their estimate in November.

This guesstimate sets the table of goodies for legislators to fight over next session. And $7 billion, well, that's a lot of booty to divvy up. Plus, revenue collections in the current two-year budget cycle are running ahead of a year ago's estimate. The Forum folks believe the state will bring in over $310 million over the statutory caps in place for the current budget cycle.

The Economic Forum estimate is over a billion dollars more than the 2005 budget passed by the Gang of 63 in 2005. Not to mention that Nevada state government outpaced all others in general fund growth from 1994 to 2005, growing 147.5%. That's right, our tight-fisted public servants grew government in the Silver State more than such bastions of liberal lawmaking 
as Delaware, New Jersey, Virginia, and California. That takes some doing.

Now Carson City gets to back up the truck for more, and state agency department heads are licking their chops and have already sent in their wish lists. State budget head Andrew Clinger told the R-J that state agencies have requested nearly $1 billion more than the revenue total. Good grief, have they no shame.

The R-J noted that the forum projections are conservative. After the Kenny Guinn tax increase of 2003, collections rocketed 31.7 percent the following year. In 2005, state revenues grew another 14.1 percent and 11.5 percent in fiscal 2006. Back in 2005, Glenn Cook noted in the R-J that the 2003 tax hikes were "deemed essential for a state government supposedly starved by a stumbling economy and a flawed tax structure, fueled nearly $1 billion in increased spending."

And now, with no mention of tax cuts this campaign season, legislators will have yet another billion to spread around. As Cook noted two years ago, Nevada lawmakers are ignoring the inevitable: "When government grows faster than the private sector and businesses are forced to operate in an increasingly hostile climate, economic prosperity cannot be sustained. 
Eventually, both bubbles will burst."

Masked by a good economy, few seem to be paying attention while state government grows at an alarming rate to a size that a normal non-boom economy cannot begin to pay for. Of course budget-busting items like full-day kindergarten are campaign promises from the now strangely silent Dina Titus. What's the matter Dina; that garage cat got your tongue?

We should remember that government employee Ms. Titus is as Glenn Cook described her-openly hostile to business. She expects businesses to pay good wages, provide health insurance to employees, and supply the state with increasing amounts of spending money to boot.

Meanwhile, despite having all of this money the Transportation Department says it doesn't have enough money to build roads. So a Blue Ribbon task force (sound familiar) of local leaders has been meeting to come with a way to raise the $3.8 billion that the Nevada Department of Transportation says it is short. Raising the already high gas tax in Nevada has been proposed to raise the $280 million a year NDOT says it needs. According to panel member Tom Skancke, president of the Skancke Corp., the highway situation "isn't a problem, it is a crisis." Skancke is peeved by the task force's reluctance to continue the meeting and vote on other tax proposals.

Maybe he doesn't realize: the taxes have already been raised-in 2003 and 2005. How much more can Nevada taxpayers take?

Doug French, Liberty Watch Columnist 


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