All eyes and most of the talk has been focused on the $1.1 billion worth of extended sunsets and new taxes in Gov. Brian Sandoval’s recommended 2016-17 budget.
That includes $544.5 million over the biennium by extending the “temporary” tax hikes that currently feed the General Fund plus $569.4 million in new revenues.
That money increases the total available General Fund revenue for the coming biennium from $6.2 billion to $7.3 billion and balances Sandoval’s proposed budget.
But that total doesn’t include the nearly $700 million in existing taxes and diversions outside the General Fund.
When that money is added in, the total is a bit north of $1.8 billion — a significant increase over that $1.1 billion number.
Keeping the Local School Support Tax portion of the sales tax at 2.6 percent instead of 2.25 percent is projected to generate $376.5 million over the biennium. Extending the transfer of the Room Tax hike is worth another $308 million.
Finally, the plan includes $12.6 million from the Net Proceeds of Mines tax in 2017.
The projected $697.1 million total isn’t included in the administration’s talking points because it goes directly to the school districts rather than the General Fund.
Those too were supposed to be temporary increases but, in Sandoval’s budget, the increases, like most of the other sunsets and diversions on the list, become permanent.
The $544.5 million in existing temporaries plus the $569.4 million in new revenues and the $697.1 million going directly to school districts total $1.811 billion.
“There are going to be some difficult decisions to be made but they have to be made to move our state forward,” Sandoval said at his inauguration in January.
A couple of those so-called temporaries still are planned to go away, eventually. Specifically, the $127 million from the Government Services Tax and the $66.9 million in GST penalties and commissions are still listed as sunsetting at the end of Fiscal 2017.
But most, including the Modified Business Tax, the new and much larger Business License Fee, the Sales Tax Commissions, LSST increase and IP-1 Room Tax transfer are all to become a permanent parts of the state’s revenue stream, as part of Sandoval’s budget.
Lawmakers have already begun reviewing the proposed increases in the governor’s recommended budget. Most of the new money is dedicated to improving the K-12 education system, an idea that has proven popular even among some of the Legislature’s most conservative members.
They are expected to begin discussing his plan to pay for it all — a much more contentious issue — in the near future.
“I am going to fight for this, not because I want to raise everybody’s taxes but because I believe in my heart and soul that this is what we need to move Nevada forward, to get to this new Nevada that you all see happening right before your eyes,” Sandoval told the Associated Press.
“And for those who don’t want to do that (specify budget priorities), then they need to do the same thing. They need to say, ‘This is where I am going to cut.’ Because right now, they get to say, ‘I have 12 votes not to raise your taxes.’ But there are consequences with that.”