Tax package is first veto overridden by both houses

The tax package in SB429 is the first of the bills vetoed by Gov. Jim Gibbons to be overridden by both houses of the Nevada Legislature.

The compromise bill was worked out by a bipartisan negotiating group to fund the state budget and is projected to raise $781 million over the biennium.

The primary revenue generators in the bill are a 0.35 percent increase in the sales tax and a near doubling of the Modified Business Tax. Both of those increases are to sunset in two years.

The tax bill was the sixth bill Assembly members voted to override Friday. It was the first to draw any comment from members.

Republicans James McArthur of Las Vegas and James Settelmeyer of Douglas County said the middle of a recession is the wrong time to increase taxes on business. Members of the GOP had argued during negotiations the increase should be more on the sales tax and less on the business tax.

But Assemblyman John Carpenter of Elko broke the tension by telling members: "I've been talking to the Lord and the Lord says it's still OK to vote for this."

The vote to override was 29-13 with Carpenter the only Republican joining the majority.

Other members of the Republican caucus voted against the taxes even though fully half of them had just finished voting for the budget bills spending the money the tax plan would raise.

In short order and with little debate, the Assembly joined the Senate in overriding the Authorizations Act, which contains all the non-general fund money in the state budget, and the state employee pay bill, which imposes a furlough on state employees and reduces the funding proportionately for teachers and university employees.

In addition, the Assembly voted to override five Assembly bills making up different parts of the budget, sending those measures to the Senate for its vote on whether to reject the governor's vetoes. Those are AB562, the Appropriations Act, which contains $3.88 billion in General Fund expenditures, and AB563, which appropriates $2.79 billion to fund the public school budgets.

In addition, they overrode the veto of the business portal bill " AB146 " the bill increasing the state's collection allowance for collecting and distributing sales tax revenue to the counties " AB552 " and AB543 which increases the governmental service tax in Clark and Washoe counties.

The Assembly actions follow the Senate votes Thursday night to override the Authorizations Act, pay bill and tax package, all of which are now formally overridden by both houses.

Contact reporter Geoff Dornan at gdornan@nevadaappeal.com or 687-8750.