POLITICS

Brian Sandoval surprises party and proposes biggest tax hike in Nevada history

Nevada Gov. Brian Sandoval talks about the ongoing legislative session from his office at the Capitol in Carson City, Nev., on Friday, April 17, 2015. Sandoval says he's optimistic that lawmakers will reach a deal on the state's budget. (AP Photo/Cathleen Allison)

Nevada Gov. Brian Sandoval talks about the ongoing legislative session from his office at the Capitol in Carson City, Nev., on Friday, April 17, 2015. Sandoval says he's optimistic that lawmakers will reach a deal on the state's budget. (AP Photo/Cathleen Allison)

Nevada Republicans made history last election when they took control of both houses of the Legislature for the first time since 1929.

Now they're on the verge of leaving a surprising legacy by implementing the biggest tax hike in state history.

Gov. Brian Sandoval has shaped a budget plan around raising or extending $1.1 billion in taxes, intending to funnel the new revenue into the state's low-performing public school system.

The tax package passed the state Senate last week with well over the two-thirds margin required to garner approval in this historically conservative state. Should it pass the Assembly, Sandoval could rewrite the definition of the state's Republican Party.

"He has branded Republicans in Nevada as a party that wants to get things done," said Jeremy Hughes, who managed Sandoval's campaign. "Gov. Sandoval has done the cutting, he's done the reforms ... This is just the next step to ensuring we have a good education system."

Sandoval's proposal has infuriated anti-tax types, both in Nevada — where no-compromise conservatives took over the state party years ago, wreaking political havoc — and nationally.

"He is a Republican with a Hispanic last name in a swing state. Were he in good odor as a Reaganite Republican, he'd be on everybody's list as a vice president — and he's not because of taxes," Grover Norquist of Americans for Tax Reform in Washington, D.C., said of Sandoval. "He's not just trashing his national prospects — he's going to cost Republicans" the Nevada Assembly and Senate.

Sandoval, who easily won re-election last year with no official Democratic opposition, is termed out and hasn't voiced an intention to run for further elected office. He has indicated he's uninterested in running for Sen. Harry Reid's seat next year and that his proposal shows he's mainly concerned with Nevada and not his own political future.

"As a Republican, this is not orthodox," Sandoval said about his tax increase in a recent interview with The Associated Press. "But at the same time, it's my job to be honest with the people of the state of Nevada."

Supporters of former Florida Gov. Jeb Bush have circulated Sandoval's name as a potential vice presidential pick, but speculation about his future swirls mainly around a possible role in a Republican administration as Attorney General or a Supreme Court justice. As governor of a small state whose legislature meets every two years, he wields enormous power and has waited until the Nevada economy, hammered by the real estate crash, was on the upswing before proposing his increase.

Erik Herzik, a political scientist at the University of Nevada, Reno, said he expects the far-right opposition to Sandoval's tax hike to fizzle.

"You're still going to have the bad PR of too much talk about guns and silly talk about transgender kids using bathrooms," he said, referring to hot-button bills backed by the most conservative Assembly members this session. "But the Republicans at the top can say: 'We got it done. You put us in charge, and look what we did.'"

Nevada's meager public education funding has bedeviled the state for years. In 2003, another Republican governor tried to raise taxes to fund education and end the state's reliance on gambling receipts, only to see his party melt down over the effort.

Last year's tax hike was another effort to address the problem, though Sandoval argued it was poorly structured.

Tom Skancke, a friend of Sandoval's and executive director of the Las Vegas Global Economic Alliance, which has endorsed the tax hike, said education is the top issue that stops businesses from relocating to Nevada.

"Of the 251 companies who came through my door last year, not one said 'I'm here because of your tax structure,'" Skancke said. But more than a third told him they wouldn't move because of the state's poor education system, he said.

Most observers believe conservatives in the Assembly may be able to whittle down the size of Sandoval's plan but not avoid raising taxes. Leading the talks in the lower house are moderate Assemblymen Paul Anderson and Derek Armstrong, who have proposed their own tax plan but said they generally support the governor's spending goals.

"I don't think being a Republican means no taxes, because at the end of the day, everyone feels a responsibility to provide services," Armstrong said. "The governor's proposal for education is definitely something I'd say the majority of the building will get behind."

Conservatives warn that those votes will have consequences in the next election.

"I've talked to a lot of Republican groups around the state since the governor announced his plan," said Victor Joecks of the conservative think tank Nevada Policy Research Institute. "They are furious."

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