- Associated Press - Tuesday, April 21, 2015

CARSON CITY, Nev. (AP) - A major component of Gov. Brian Sandoval’s ambitious attempt to raise or extend $1.1 billion in taxes over the next two years passed a Senate vote Tuesday, although it could face tough times ahead in the less predictable Assembly.

Senators voted 17-4 to advance SB252, which gave the bill the constitutionally required two-thirds majority it needed to pass. Proponents said it would raise the revenue needed to move Nevada’s school system forward.

“Today’s vote is not about the next election, but about the next generation,” Republican Senate Majority Leader Michael Roberson said.

Four Republican senators opposed the measure: Pete Goicoechea, Don Gustavson, Scott Hammond and James Settelmeyer.

The bill is Sandoval’s proposed restructuring of the state’s business license fee, and it’s projected to raise more than $437 million to fund K-12 education programs over the next two years.

“We are now one step closer to securing a future in which Nevada is the leader in education, innovation and student success that I wholeheartedly believe we can be,” Sandoval said in a statement after the vote.

The measure passed out of a committee on a party-line vote after several hours-long hearings that included testimony from Sandoval and three past Nevada governors. A full Senate vote was postponed for weeks, however, as lawmakers hammered out an agreement that would bring together Democrats, who are in the minority, and Republicans who are hesitant to support a tax increase.

The measure is not without opponents. Gustavson spoke against the plan in a speech on the Senate floor, saying it would be unaffordable to many businesses and would take Nevada down a slippery slope of taxation.

“This is just a foot in the door,” he said. “Once this tax passes, it’s going to continue to grow and grow and grow.”

Conservative groups including the Nevada Policy Research Institute and Americans for Prosperity have condemned the plan as harmful for businesses, while state controller Ron Knecht and treasurer Dan Schwartz said they were disappointed their alternatives haven’t been seriously considered.

Others said they supported the idea of raising money for education initiatives but preferred a different mechanism.

Democratic Sen. Pat Spearman unsuccessfully tried to add an amendment that borrows from a failed tax bill she sponsored. It would have imposed a 0.17 percent gross receipts tax on business revenue over $25,000 a quarter.

She cited findings from the nonpartisan Guinn Center for Policy Priorities, which supports the broad-based nature of the proposed business license fee but has questioned whether the bill’s industry-specific tax rates make sense.

The Guinn Center supports the gross receipts tax concept in Spearman’s and Sandoval’s proposals, and has suggested combining elements of those bills with AB464, a tax plan proposed by Assembly Republican leadership that seeks a higher rate for the state’s existing modified business tax and fewer deductions for businesses.

While Democrats praised Spearman’s amendment, they ultimately voted for the plan without it.

Sandoval’s bill is bound to face political challenges in the Assembly, which has struggled with infighting and includes a bloc of vocal conservatives who vowed to oppose tax increases.

Republican Assembly Majority Leader Paul Anderson said the lower house is anticipating final revenue projections from the state’s Economic Forum on May 1 and plans to start working on the bill soon.

“We’ll start looking at the details and how we get it out of the building,” Anderson said.

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