Live blog: IFC tax study firm selection meeting
Moody's wins the contract.
***Scroll for updates***
The IFC Subcommittee to conduct a review of Nevada's revenue structure is meeting today to pick the consultant that will actually conduct the tax study. The agenda is here. The meeting is not, I repeat NOT, being streamed online. More on that later.
The four contenders to conduct the tax study are Willdan, Moody's, Nevada Consultants, and UNR.
9:25 Willdan presents first. They have 45 minutes. With four groups presenting this is going to be a longer meeting, but that's why Write on Nevada is here.
9:30 Willdan says they are currently working on 3 dozen "revenue enhancement" projects. No doubt that will endear them to some members of the committee.
9:43 Willdan is talking about how to stabilize revenue (taxes). For their sakes, I hope they realize that this isn't about stabilizing taxes, it's about finding an excuse to increase taxes.
9:45 Willdan is now talking about rainy day funds. Rainy day funds are a terrific idea, but again, that's not what the IFC wants. I'm not liking Willdan's chances here, because they don't seem to realize this study is just a cover to raise taxes not govern responsibly -- although I'd be happy to be wrong.
9:48 Sen Townsend is once again wearing terrific suspenders.
9:52 Sen Townsend asks if the Willdan study will be revenue neutral.
Willdan says they'd be open to anything.
Sen. Horsford cracks on the way Sen. Townsend dresses. Good natured and funny.
9:57 Hmmm... Willdan and Sen. Weiner both say many states are looking for revenue.
Remember this: budget problems weren't just a Nevada problem.
10:02 Sen. Care says the IFC must consider an income tax in order to have a ... complete study.
10:06 Assemblyman Conklin cites the Tax Foundation on how much of Nevada's tax burden is paid by out-of-staters. He says it's almost half.
10:10 Sen. Horsford how do you build consensus on quality of life issues?
This is the crux of the problem. You can't. Individuals value different things at completely different levels. The beauty of freedom is that people are allowed to pursue their own self interest, so long as they don't impose on the rights of other individuals. Government has the awesome power of being able to take individuals' time and money, and that is why government should be limited to its core functions and not try to pick the winners and losers in an economy.
10:15 Willdan's done. Sounds like they know their stuff, but did they ruin their chances by mentioning things like rainy day funds and setting priorities?
10:21 Nevada Consultants is up. Sounds like they'll be playing up the "We know Nevada" angle. For instance, Nevada's flag is on the background of all its slides. Subtle.
10:28 NV Consultants did a survey on potential new taxes. Claims that two taxes had "substantive support."
10:31 Says Nevada shouldn't lose low tax environment.
10:35 NV Consultant presenter: "Tears have welled up in our eyes" when thinking about what's happening in Nevada.
10:38 "We don't need the money...It's because we love Nevada." "He's (Eric Hilton's) doing this because he loves Nevada."
Is this a business presentation or a Hallmark movie?
10:43 Sen. Rhoads' audio on the video conference is way too loud.
10:44 NV Consultants says they will hire (20 to 30) Nevadans to do work on the study.
10:52 NV Consultants says the viability of the study must be considered from the beginning. Says NV Consultants wants to do the study in a way to "protect" the legislature.
10:56 Says NV Consultants won't make fun of Nevada ... like those other (big, competing) companies. Says "we're the best for this task, because we're Nevadans."
And with that their presentation ends. Oh, did they mention they're from Nevada?
I have my doubts they'll be selected.
11:09 Moody begins its presentation.
11:16 Moody's presenter says Ne-vah-da and immediately catches himself.
11:20 Moody's presenter says sales tax states are usually less volatile , but Nevada is unique (because of dependence on tourism). Says personal income tax states are also experiencing large declines in tax revenue. Says just adding personal income taxes may not do the trick.
11:26 Moody's says they suspect revenues won't keep up in future years and that current taxes are becoming less effective. Adds that individual and corporate income taxes are also facing downward pressures.
11:31 New Moody's presenter compares the Nevada Vision Stakeholder Group to herding cats.
11:36 Moody's asks, "Will improving quality of life require increased tax revenues?"
We already know Assemblyman Anderson's answer, "We don't have money. That's the reason we're doing the study."
11:42 Assemblyman Conklin says Nevada's tax revenue isn't keeping up with Nevada's income. I'll have to scan in the graph later today so you can see it, because tax revenue has stayed very consistant (with tax increases) with personal income. But more than that, why should government grow as income grows? Government should provide its core functions, not grow as the populace gets richer.
11:51 Assemblyman Conklin is still pretty excited about something. He's been engaged with Russ Guidon (Legislative staff) in an animated exchange for a couple minutes.
11:53 Moody's presentation ends. Up next are the presenters from UNR. I expect lots of talk about their vision for Nevada. It's worth remembering what Sen. Raggio pointed out at the last tax study working group meeting. It's a huge conflict of interest for UNR employees to be making the case for more taxes when they would (presumably) directly benefit from increased taxes that led to greater state funding for UNR.
12:02 On a completely unrelated note, it's noon and I'm starting to get hungry. There'll be a lunch break after UNR's presenation.
12:02 The UNR team includes 20 faculty members from UNR and UNLV and 14 grad and undergrad students. No wonder this proposal costs over $900,000. (The limit was suppose to be $500,000, but the IFC can spend what they want. Even though Legislators claimed to have "cut to the bone", they found money for this.)
12:06 UNR: "Will we be biased? Absolutely. Will we be self-serving? No."
They are also playing the "We are from Nevada" card.
12:09 Says they'll look at the "universe of tax options." Says the economic base is shifting away from the existing tax base.
12:13 UNR: Higher tax rates have several negative consequences.
Let's keep that in mind.
12:23 UNR is talking about the places Legislators can "invest" your (tax) money and the return they can get.
12:25 UNR's used 25 minutes and they still have two professors to go. With only 20 minutes left, I think they're going to run out of time.
12:31 UNR sped through its final two presentations and now has 15 minutes for questions.
12:32 Says they'd look at what California is proposing. Says CA is looking to lower the personal income tax and eliminate the corporate income tax, because they are too volatile. Suggests expanding the sales tax to services.
I had not heard about that about CA, but that proposal sounds quite interesting.
12:40 Assemblyman Stewart asks if UNR is going to be able to reduce the cost. One of the presenters says he'll take his salary out of the proposal and do it for free.
12:42 Break until 1:15.
1:34 Moody's is selected unanimously. Willdan is the second choice in case something doesn't work out. The next step is to negotiate and finalize the contract. The next meeting of the full IFC committee is November 19 and the subcommittee will meet afterwards to select the members of the Nevada Vision Stakeholder Group.
1:41 Meeting adjourned.