CARSON CITY, Nev. — Nevada Attorney General Aaron Ford is opposing a lawsuit filed by Nevada legislative Republicans to overturn two tax extensions approved in the last session.
Ford filed a motion in Carson District Court last week to dismiss the lawsuit filed by all eight Nevada Senate Republicans charging that those bills are unconstitutional because they didn't get a two-thirds vote in the Senate.
SB551 removed the sunset from the higher Modified Business Tax to pump about $100 million into K-12 education. SB542 extended the technology fee DMV is using to pay for a new computer system for an additional two years.
Both passed the Senate on a party-line vote, 13-8 — one vote short of two-thirds.
“Because neither bill ‘creates, generates or increases' ‘taxes, fees, assessments and rates,' each bill is constitutional,” the motion argues, quoting from the Nevada Constitution's “supermajority” provision.
Citing that language, the motion says, “there is no reasonable doubt that the supermajority provision is intended to apply to new taxes relative to prior years rather than continuing existing taxes at existing rates as the 2019 Legislature did.”
And the attorney general's motion says that, if there is any ambiguity requiring interpretation, “this court should interpret the supermajority provision narrowly with the intent that it apply only to new or increased taxes, not to the continuation of existing taxes at existing rates from one year to the next.”
Ford filed the motion on behalf not only of Gov. Steve Sisolak and the Department of Taxation and DMV, but Senate Majority Leader Nicole Cannizzaro, D-Las Vegas. The suit also lists Lt. Gov. Kate Marshall and Senate Secretary Claire Clift, “in their official capacity.”
Led by Senate Minority Leader James Settelmeyer, R-Minden, Senate Republicans stood together, arguing that the constitutional provision has always been interpreted as applying to extending existing taxes as well as to new or raised taxes.
He argued that SB551 wasn't even necessary to fund K-12 education because the state's surplus is greater than the $100 million the MBT would generate. The DMV fee, by comparison, would only generate about $7 million a year.
But Democrats argued that, in a May 8 memorandum, Legislative Counsel Brenda Erdoes cleared their simple majority vote on the two bills.
“As set forth by the Legislative Counsel in its May 8, 2019 memorandum, Senate Bill 551 maintains the existing tax rate and revenue structure,” the motion states.
Likewise, it says SB542 doesn't create or generate more revenue, it simply extends the existing DMV fee for two years.
In addition, the motion argues that the Nevada Constitution, “must be strictly construed in favor of the power of the Legislature to enact legislation under it.”
“Here the people's elected representatives in the Senate disagree on how to interpret Nevada's Constitution,” it concludes. “Where both interpretations are reasonable and the majority Legislature relied on the specific advice of its counsel, this court should defer to the Legislature's interpretation.”
The motion asks that the lawsuit be dismissed with prejudice.
No hearing date has yet been scheduled in the case, which is before Carson District Judge Todd Russell.
-->CARSON CITY, Nev. — Nevada Attorney General Aaron Ford is opposing a lawsuit filed by Nevada legislative Republicans to overturn two tax extensions approved in the last session.
Ford filed a motion in Carson District Court last week to dismiss the lawsuit filed by all eight Nevada Senate Republicans charging that those bills are unconstitutional because they didn't get a two-thirds vote in the Senate.
SB551 removed the sunset from the higher Modified Business Tax to pump about $100 million into K-12 education. SB542 extended the technology fee DMV is using to pay for a new computer system for an additional two years.
Both passed the Senate on a party-line vote, 13-8 — one vote short of two-thirds.
“Because neither bill ‘creates, generates or increases' ‘taxes, fees, assessments and rates,' each bill is constitutional,” the motion argues, quoting from the Nevada Constitution's “supermajority” provision.
Citing that language, the motion says, “there is no reasonable doubt that the supermajority provision is intended to apply to new taxes relative to prior years rather than continuing existing taxes at existing rates as the 2019 Legislature did.”
And the attorney general's motion says that, if there is any ambiguity requiring interpretation, “this court should interpret the supermajority provision narrowly with the intent that it apply only to new or increased taxes, not to the continuation of existing taxes at existing rates from one year to the next.”
Ford filed the motion on behalf not only of Gov. Steve Sisolak and the Department of Taxation and DMV, but Senate Majority Leader Nicole Cannizzaro, D-Las Vegas. The suit also lists Lt. Gov. Kate Marshall and Senate Secretary Claire Clift, “in their official capacity.”
Led by Senate Minority Leader James Settelmeyer, R-Minden, Senate Republicans stood together, arguing that the constitutional provision has always been interpreted as applying to extending existing taxes as well as to new or raised taxes.
He argued that SB551 wasn't even necessary to fund K-12 education because the state's surplus is greater than the $100 million the MBT would generate. The DMV fee, by comparison, would only generate about $7 million a year.
But Democrats argued that, in a May 8 memorandum, Legislative Counsel Brenda Erdoes cleared their simple majority vote on the two bills.
“As set forth by the Legislative Counsel in its May 8, 2019 memorandum, Senate Bill 551 maintains the existing tax rate and revenue structure,” the motion states.
Likewise, it says SB542 doesn't create or generate more revenue, it simply extends the existing DMV fee for two years.
In addition, the motion argues that the Nevada Constitution, “must be strictly construed in favor of the power of the Legislature to enact legislation under it.”
“Here the people's elected representatives in the Senate disagree on how to interpret Nevada's Constitution,” it concludes. “Where both interpretations are reasonable and the majority Legislature relied on the specific advice of its counsel, this court should defer to the Legislature's interpretation.”
The motion asks that the lawsuit be dismissed with prejudice.
No hearing date has yet been scheduled in the case, which is before Carson District Judge Todd Russell.
