2005 legislative legacy

Governor Kenny Guinn called the 2005 Nevada Legislature, which will be his last as the state's chief executive, the best that he has seen.

This session will probably be remembered most for two measures that have a direct impact on taxpayers: a tax rebate and a property tax cap.

Nevada businesses will share in the benefit of these two landmark measures.

Unprecedented windfall The 2005 Legislature was considered by most business leaders to be a major improvement over the previous session in 2003, when legislators and lobbyists debated over what resulted in the largest tax increase in state history.

Nevada citizens and businesses will benefit from this unprecedented windfall that the state has experienced.

Lawmakers approved rebate checks of $75 to $275 for every Nevadan who had a registered vehicle last year or was at least 65 years old as of Jan.

1, 2005.

The $300 million rebate, the result of a state budget surplus, will be distributed through roughly two million checks between July 1 and December 31, 2005.

Businesses that own vehicles will also benefit from the rebate.

Excluded from the rebate will be utility trailers, vehicles weighing more than 26,000 pounds and rental car fleets.

Debate on property tax relief dominated much of the first half of the session.

Clark and Washoe Counties have seen some of the highest real estate appreciation in the country and Nevada homeowners and businesses were facing skyrocketing property tax bills.

Under Assembly Bill 489, the legislature voted to cap annual property taxes increases at 3 percent for homeowners and 8 percent for businesses.

Another tax matter that business leaders will see is a temporary reduction in the payroll tax rates, from 0.65 percent to 0.63 percent.

This modest reduction is only temporary and will expire on June 30, 2007.

Banks, which pay a higher payroll tax rate of 2 percent,were unable to lower their rate, but they did receive some relief on the annual $7,000 per-branch tax that was passed during the 2003 Legislature.

Banks will be allowed to forgive the per-branch fee for one branch per bank in each county.

This will assist rural branches whose profit margins are narrower.

Small businesses burdened with trying to offer affordable health insurance will soon see some help thanks to a bipartisan bill supported by lawmakers.

This plan would take unused federal funds that the state is supposed to receive for providing health insurance for children from low-income families and use it to subsidize insurance plans for businesses between two and 50 employees.

Economic development agencies get $10 million Leaders of the economic development entities also praised the actions of the 2005 Legislature.About $10 million in economic development money was earmarked to the primary economic development entities of southern Nevada and northern Nevada the Nevada Development Authority and the Economic Development Authority of Western Nevada.

Not only are the economic development entities appreciative of the funds to promote their regions, they also enjoyed the return to normalcy and stability that did not exist during the 2003 session.Many businesses looking to expand or move to Nevada nervously watched the legislators debate some controversial tax proposals in 2003.

In the 2005 session, there were no tax increases and surplus tax dollars were spent on important quality of life issues that will make Nevada a more appealing state for business to move to and grow.

Political experts felt one thing that will not reflect well on the public is the Legislature's inability to meet the constitutionally mandated 120-day limit.

Because of political bickering, Governor Guinn was forced to call a oneday special session on the 121st day.Much of the debate in special session centered on two bills: a new funding plan for the millennium scholarship program and a scale back of the full-day kindergarten program.

Despite all of the successes of the 2005 Legislature, there are critics who feel that Nevada's budget has grown too big.

During the Guinn governorship, the state budget has nearly doubled.

It is estimated that Nevada's budget has grown in recent years to twice its population and inflation rate combined.

Considerable debate pending There will be considerable debate about taxes and spending leading up to the 2007 session.

The 2006 election for governor as well as a possible constitutional ballot on spending restraints will provide a forum for this debate.

Fiscal conservatives will likely campaign on the need to reduce or repeal the tax increases passed in 2003 and the other side of the political spectrum will argue that spending at the current levels is necessary to provided essential government services.

If the Nevada economy continues to grow at its healthy rate over the next 18 months and there is another tax surplus, there will be an expectation created by the 2005 Legislature to provide another tax rebate.

For voters, this session will be remembered for efforts to give tax back to Nevadans and keep taxes low on their homes.

But for those insiders working the halls of the Legislature, they will know this session for political jockeying that took place.

It was the first time we had two legislative leaders in the same party running for governor.With that we had the political ambitions of other legislators looking at ascend up the legislative ladder or perhaps for higher office.Unlike in previous sessions, these differences were more between the Senate and Assembly rather than the Republicans and the Democrats.

A change of watch? The 2007 Nevada Legislature will look much different.

It will have a new Governor, likely a new Assembly speaker in Barbara Buckley and new Assembly majority leader, and perhaps a new Senate minority leader, should Sen.

Titus be elected governor.

Few predict that party control of the Senate or the Assembly will change hands, unless the next governor sweeps his or her party into power.

Michael Dayton is vice president of the government affairs group in the law firm of McDonald Carano Wilson.