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Nevada Lawmakers Approve Mining Tax Increase At Session's End

The Nevada Assembly gavels out.
Paul Boger
KUNR Public Radio
With the end of the 81st Session of the Nevada Legislature, Nevada passed one of the largest tax increases on gold and silver mining in state history.

Nevada lawmakers have successfully negotiated one of the largest mining tax increases in state history. The bill’s passage caps off a tumultuous session in which lawmakers added nearly hundreds of millions of dollars in new funding for schools. KUNR’s Paul Boger reports.

Lawmakers adjourned the 81st Session of the Nevada Legislature sine die just a few minutes shy of midnight, late Monday.

The end of the session is usually a time of celebration. After 120 days of committee hearings, budget negotiations, floor speeches and countless hours waiting around for votes, lawmakers are understandably ecstatic to hear the gavel for the final time, but this year, the joy also marked the end of a particularly grueling week in which lawmakers passed a budget and finalized one of the largest tax increases on gold and silver mining in Nevada history.

Speaker of the Assembly Jason Frierson presented AB495 to lawmakers.

“It is said that legislation is the art of compromise," said Frierson. "I believe that this bill represents a monumental compromise and collaboration that will benefit Nevadans now, but also for years to come.”

The measure creates a new excise tax on gold and silver producers with at least $20 million in gross profits annually, and it’s expected to raise an estimated $300 million over the next biennium, specifically earmarked for education.

Introduced in the waning hours of the session, the bill was drafted as a compromise among, not only, lawmakers and the mining industry, but also teachers' groups and gaming.

"I think all the stakeholders involved are leaving, everybody is leaving, a little sad," said Tyre Gray, President of the Nevada Mining Association. "We’re certainly leaving a little lighter, but at the end of the day, we’re all happy to know that we’re going to be helping education.”

The thing is, the mining industry was forced to the negotiating table. First, during last summer’s special sessions, Democrats introduced a handful of resolutions aimed at amending the state constitution to dramatically raise mining’s tax liability.

The Clark County Education Association also bolstered Democratic negotiations after they successfully added a set of tax initiatives to the 2022 ballot, potentially raising the state’s sales and gaming taxes. The union is currently working to withdraw the initiatives, now that AB495 is on the governor's desk.

Gray says the industry took those factors into account.

“When you’re given four options, and you’re asked to select one, you’re probably going to choose one that fits your business model a little better,” said Gray.

Even with the mining industry’s blessing, Democrats were unable to secure the vote alone. Under state law, the creation or modification of taxes requires a two-thirds majority for passage. That required buy-in from at least four Republicans, two in the Assembly and two in the Senate.

Throughout the session, GOP lawmakers advocated for increased funding for opportunity scholarships for students with special needs. They also wanted $15 million in federal COVID relief funds dedicated to charter schools affected by the pandemic.

Six Republicans ended up voting for the bill, including Assemblywoman Jill Tolles of Reno. She says the compromise legislation signaled a win-win for the state.

“From the very, very beginning, [I] said that it was important to me that any kind of investment in education needs to come from an industry that is supportive of that, and we saw that in this case," said Tolles. "And [it] needs to really impact all of our students in our schools, statewide. I think [it] really covers the bases [of] making sure our kids are okay, and for me, that’s always going to be the driving force.”

Lawmakers put nearly half a billion dollars in new money to education using the increased mining taxes and federal COVID relief funds. For Speaker Frierson, this push to increase funding for education is just the start.

“I’m really proud of the record investment that we’re making," said Frierson. "We’ve started a conversation about a 10-year plan to increase per-pupil spending. We’re going to have to continue to track results to make sure it’s not just money, but it's transparency and accountability. All of that’s a part of it, but we’re proud that we’re making an investment in our kids.”

In all, lawmakers approved roughly $9.5 billion in state appropriations for the next two years.

One thing this budget doesn’t take into account is federal COVID relief money. The state will get roughly $2.7 billion under the American Rescue Plan, but those funds can only be used for certain things. Lawmakers say they can appropriate those stimulus funds during the interim between sessions.

Paul Boger is a former reporter at KUNR Public Radio.
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