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Nevada teachers' union to seek gaming tax hike

by Antonia Planas, Howard Stutz, Molly Ball

LAS VEGAS, Nevada -- Every roll of the dice and pull of a slot machine would mean more money for Nevada's public schools if the state's largest teachers union gets its way.

The board of directors for the Nevada State Education Association voted unanimously Saturday to start a petition drive to raise the gaming tax on Nevada's largest casinos to 9.75 percent from 6.75 percent. The 3 percentage point increase, for casinos that gross more than $1 million a month, would translate into an additional $250 million per year for Nevada's public schools, said Lynn Warne, president of the union.

Warne said the proposal for the ballot campaign was a last resort in a state where public education is consistently underfunded.

"There is nothing more important than increasing educators' salaries, benefits and improving their working conditions as well as the learning conditions of students," Warne said. "We have chosen to stand to make a difference, and we will not quietly submit to the idea that there is nothing we can do."

Gaming officials said Monday their industry was being unfairly targeted.

"We do share the same concerns that the teachers are expressing," Nevada Resort Association President Bill Bible said. "As employers, we want an educated work force and, as parents, we want to see good schools. The problem is you're placing the burden on one industry."

Bible, whose organization has been running an advertising campaign regarding gaming tax dollars already going into the state's education system, said the industry funds about one-third of the state's educational budget.

Gaming taxes are expected to produce about $1.9 billion during the next two fiscal years. Total state spending for the two years is $6.9 billion. Gaming taxes are not earmarked for any particular purpose. About $2.3 billion of state general fund revenue is to be spent on public K-12 education in the current two-year budget period.

Boyd Gaming spokesman Rob Stillwell said an increase in the gaming tax could affect the company's investment plans. He said that if taxes need to be increased, gaming should not be the lone target.

"Other businesses and industries that benefit from our vibrant economy need to have a responsibility to be part of the solution," Stillwell said. "We just happen to be the most visible."

To get a constitutional amendment passed, the teacher's union will have to get signatures from all of Nevada's 17 counties, then have the ballot initiative approved by voters in two successive elections. An initiative that went on the ballot for the first time in 2008 would have to pass again in 2010 before it could take effect.

The 58,628 required signatures would be due to county clerks by May 20. The clerks would count them and submit them to the secretary of state for verification. Signature-gathering campaigns usually cost upwards of $100,000.

Warne said the Nevada State Education Association has the money and support to be successful. But she was reluctant to say what entities support the initiative because the campaign just began. Warne said a petition has been drafted, but she said she could not provide it because she was traveling Monday afternoon.

State Superintendent Keith Rheault said studies have shown that public education is underfunded in Nevada. Rheault said he supports finding new methods that would bring more money to schools.

After a 2006 study, Denver-based consultants Augenblick, Palaich and Associates concluded that Nevada needed to boost education spending by $223 million a year, starting with a base year of 2003-2004, so students can meet the performance standards of the federal No Child Left Behind Act by 2014, when full compliance is required.

Spending on public education in Nevada was $2.23 billion in the base year of 2003-2004. The consultants said the state needed to build up to spending $4.46 billion a year in the 2013-2014 fiscal year.

The consultants' recommendation did not reflect growth in student enrollment. As more students enroll in school each year, public education funding would have to be increased more to accommodate the additional pupils, they said. The calculation also did not include construction costs or spending on transportation and buses.

Gov. Jim Gibbons has been firmly against raising taxes. But he has said he supports the people's right to tax themselves through initiatives. In this case, the people would be asked to vote to tax an industry instead, and a spokeswoman for Gibbons was not enthusiastic.

"It's their (the union's) right to go out into the community and see what feedback they get. I think you'll find that people don't want their taxes raised," Melissa Subbotin said. "Members of the gaming industry are also residents of the state, and I can't imagine that they'll sit back and be silent if taxes are about to be imposed on their industry."

The gaming tax last was raised by the 2003 Legislature to 6.75 percent from 6.25 percent.

But one gaming official, Lesley Pittman, Station Casino's vice president of corporate and government relations, said the gaming industry needs to do a better job winning the public relations battle to ward off a tax increase.

She said gaming growth, such as the large developments on the Strip, will help Nevada pull out of any economic woes much quicker than other parts of the nation.

"We've struggled to show the person who lives in this community that their personal economic health is tied to this industry," Pittman said. "A small business might not deal directly with the industry, but they might service the employees of the industry."

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