Court Ruling Upends Nevada Governor's No-Tax Stand

 
Nevada Governor Brian Sandoval is one of 11 new Republican chief executives who vowed on the campaign trail last year to balance their state budgets without raising taxes. But a sweeping ruling from the Nevada Supreme Court on Thursday (May 26) took $656 million out of the state's roughly $6 billion two-year spending plan, forcing Sandoval to modify his stand on taxes.

The high court invalidated efforts by Sandoval to grab hundreds of millions of dollars from localities to balance the state budget. Though it centered on Sandoval's plan to take money from a clean-water fund in Clark County, the decision also undercuts Sandoval's attempts to raid school district reserves, local property tax accounts and other sources.  Sandoval's senior adviser told the Las Vegas Sun that the ruling was "roughly 10 times worse" than the administration expected and the Las Vegas Review-Journal quoted a Sandoval attorney saying, "I don't see how there is any way that we could take a narrow view of the court's decision." Sandoval himself is a former federal judge.

With time running out on the Nevada legislative session, Sandoval will release a revised budget proposal today. In it, he is expected to go along with a Democratic-favored extension of a host of taxes that were approved in 2009 and set to expire by the end of June, the Review-Journal reported. While the governor has been resolute in his pledge not to raise taxes, he said on Thursday that he "will not gamble with the state's future." If Sandoval changes his position on the tax extensions, some anti-tax Republicans in the Legislature are expected to line up behind him, providing enough votes to pass the governor's revised budget, one GOP official predicted to the Review-Journal .

Meanwhile, Eric Herzik, a political analyst, noted that while the court ruling comes as a blow to Sandoval, it doesn't hand total victory to Democrats, who have sought tax increases above and beyond just the extension of the 2009 rates.

"The easy gloating approach is to say the governor blinked and broke his promise," Herzik told the Review-Journal . "But I think the governor had built a budget on thin ice, and he saw that budget fall through the ice with the Supreme Court decision ... The governor now has to go back on his promise, but the Democrats aren't getting a massive infusion of money either."
 
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