Amodei predicts education tax battle in 2002 election

The 2001 Nevada Legislature likely won't adopt the Nevada State Education Association's business tax initiative, setting up a battle for votes in the 2002 election, State Sen. Mark Amodei predicted Wednesday.

Amodei was among the speakers at a panel discussion sponsored by the Carson City Area Chamber of Commerce, a vocal foe of the initiative that would impose a tax on all businesses in the state with more than $50,000 in net income to increase state revenues for schools.

"I haven't heard anyone say they expect the (initiative) petition that's been qualified to be enacted by the Legislature," Amodei said.

"That means, for the next two years, you're going to get a strong dose of what people want you to do or don't want you to do."

Amodei criticized the use of initiatives to establish laws.

"Who has access to the process? It takes lots of money, so that means special interests, folks who haven't had much luck at the Legislature so they've bypassed that process.

"And it's a one-shop deal, up or down. You don't know who constructed an initiative. There are no hearings, no open meetings, no mandate that it be discussed in any way."

He said there may be an attempt to come up with a compromise alternative to the NSEA initiative during the 2001 session.

NSEA executive director Ken Lange "told me, 'If we can get something we can live with out of the Legislature, we may just sit on our hands about the petition'" during the 2002 election, Amodei said.

"They expect the bill for the initiative to come out of the Assembly, which would take a two-thirds majority," Amodei said. "That's supposed to be the strong education house, but I don't expect it to pass.

"It will be interesting to see how the negotiation process goes. The potential this session for sharp edges to come out and fly around the room at high speeds is fairly high."

He said that opposition to the initiative does not mark anyone as against children or education.

"It's about whether we are making a smart decision. Are we getting good value for the money we spend?" he said.

Carole Vilardo, executive director of the Nevada Taxpayer's Association, warned that the initiative, with its 22 pages and 59 sections, could not be changed for three years if voters passed it into law.

She said several items raise concerns for her.

"We would require accountability for students and for school districts, but nowhere in 59 sections do we require accountability for teachers," Vilardo said.

"If you file a 1040 (federal income tax form) with schedule E, you'll have to report as income the money from royalties, rents, trusts and estates, even if its less than $50,000.

"It says 'All persons who fall under the definition of a business shall be audited whether or not they've filed a return.' Doesn't that smack of a mini-IRS?" she said.

Businesses that operate in other states as well as Nevada would have to take into account their income from those operations, and the Nevada Department of Taxation or anyone authorized by it would be able to examine the books of any business or person that was defined as a business under the initiative, she said.

The initiative also requires that income from state and municipal bonds, which usually are exempted from local income taxes as an incentive to fund schools, hospitals and similar public projects, to be subject to the new tax, making Nevada the only state to tax those bonds, she said.

"You know, the Clark County School District is the single largest issuer of municipal bonds in the state," Vilardo said. "Here we want to help the schools, but we would tax those bonds?"

Terry Campbell, executive director of the Nevada Policy Research Institute, said several studies have not shown that increasing education funding results in better educated students. He said the institute has seen the results of four studies into Nevada's class size reduction program in lower elementary grades and the results showed negligible improvement.

"We've spent $80 million for something that isn't working," Campbell said.

Meanwhile, in the decade since the NSEA's prior attempt to pass an initiative to increase education funding, Nevada teachers' pay and benefits combined have risen to be the 15th best in the nation, he said.

Campbell recommended several changes he said would be more effective at improving student education than increasing educators' pay:

- Return to the basics, like teaching phonic instead of the current whole language approach.

- Test students' abilities earlier, at the beginning and end of the first and second grades, rather than waiting until the third and fourth grades.

- Consider alternatives to the class size reduction programs. Elko county schools were allowed to use the class size reduction funds to try other approaches and are to report their effectiveness to the next legislature.

- Accept no excuses, such as blaming low standardized test results on the large number of Hispanic students in the state. "That's disgusting," Campbell said. "Texas beats the averages. Harlem schools are competitive. That's because their principals and administrations demand the best."

On the Web:

Nevada Taxpayers Association

http://www.nevadataxpayers.org

Nevada State Education Association

http://www.nsea-nv.org

Nevada Pro-Education Alliance

http://www.nvproed.com