The 2009 Nevada Legislative Session

Executive Summary


State lawmakers approached the 2009 Legislative Session knowing they would face difficult decisions. Declining tax revenues over the previous budget cycle had already forced legislators to gather in Carson City on two occasions for special sessions to deal with gaps between tax revenues and planned state spending. Revenue projections released in December 2008 indicated that the state's fiscal position would continue to deteriorate.

With tax revenues projected to decline for the second straight biennium, the Executive Branch was claiming that expenditures would have to grow by more than $1 billion in order to maintain government services at the same levels lawmakers and the governor had chosen when revenue forecasts were much higher. Now, with revenues projected at $5.656 billion, lawmakers faced a gap of $2.266 billion between revenues and desired spending.

To reconcile this gap, lawmakers knew they would have to choose between two general strategies: searching for additional revenue or searching for areas where state spending could be reined in. Complicating this decision were the economic conditions providing the session's backdrop: The state was already facing its worse economic recession in decades. More than a decade of overly loose monetary policy by the Federal Reserve had inspired the creation of a "bubble" market in housing that was particularly pronounced in Nevada. By the time the 2009 session began, the median sale price of a home in the Las Vegas Valley, since peaking in early 2006, had fallen nearly 50 percent.

The collapse of the artificial housing market quickly reverberated throughout the economy, leading to massive unemployment. At the outset of the 2009 session, Silver State unemployment had already reached 9.4 percent and would soon exceed 10 percent. The rising unemployment led some policymakers to argue for controlling government size rather than raising tax rates. A minority, they understood that higher tax rates — imposing higher costs on struggling businesses — would only exacerbate the unemployment problem.

Geoffrey Lawrence

Geoffrey Lawrence

Director of Research

Geoffrey Lawrence is director of research at Nevada Policy.

Lawrence has broad experience as a financial executive in the public and private sectors and as a think tank analyst. Lawrence has been Chief Financial Officer of several growth-stage and publicly traded manufacturing companies and managed all financial reporting, internal control, and external compliance efforts with regulatory agencies including the U.S. Securities and Exchange Commission.  Lawrence has also served as the senior appointee to the Nevada State Controller’s Office, where he oversaw the state’s external financial reporting, covering nearly $10 billion in annual transactions. During each year of Lawrence’s tenure, the state received the Certificate of Achievement for Excellence in Financial Reporting Award from the Government Finance Officers’ Association.

From 2008 to 2014, Lawrence was director of research and legislative affairs at Nevada Policy and helped the institute develop its platform of ideas to advance and defend a free society.  Lawrence has also written for the Cato Institute and the Heritage Foundation, with particular expertise in state budgets and labor economics.  He was delighted at the opportunity to return to Nevada Policy in 2022 while concurrently serving as research director at the Reason Foundation.

Lawrence holds an M.A. in international economics from American University in Washington, D.C., an M.S. and a B.S. in accounting from Western Governors University, and a B.A. in international relations from the University of North Carolina at Pembroke.  He lives in Las Vegas with his beautiful wife, Jenna, and their two kids, Carson Hayek and Sage Aynne.