Vol. 4, No. 5, May 2008
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Teachers Pulling ‘Big Con’
A noted gaming analyst has dismissed the proposal from the Nevada State Education Association to raise gaming taxes as a “big con.”
Bill Lerner of Deutsche Bank released an 18-page report examining the teachers’ proposal—as well as another that was readily dismissed—to fund public projects on the backs of gaming operators.
Lerner attacks the NSEA proposal—which seems the most likely to pass based on recent polling—as “a smoke screen to increase currently higher-than-state-average teacher pay under the guise of a student achievement initiative.”
Lerner writes that teacher salaries in Nevada are already higher than salaries in other fields in the state.
“Surprisingly, we found that the median annual Nevada teacher salary is already 40 percent higher than the average Nevadan’s salary and could potentially be about 67 percent more than the average Nevadan if the proposal were to become law,” Lerner wrote.
He also notes that the “NSEA is a teachers’ union, not a student achievement advocacy group.”
The document also makes a comparison between Nevada and Illinois, which raised its gaming tax in 2001, 2002 and 2003.
“Casinos collectively laid off nearly 26 percent of their workforce. Why? Because casinos have a fiduciary responsibility to their shareholders to seek the highest returns on invested capital,” Lerner wrote.
His ultimate conclusion was an ominous one for Nevada residents who approve the tax increase: “We believe a similar phenomenon would occur in Nevada should taxes be raised.”
The Nevada Resort Association is doing all it can to keep the initiative off the ballots by challenging it in court. A judge ruled April 3 that the NSEA could begin collecting signatures, but the NRA is asking the Nevada Supreme Court to issue a speedy decision in an appeal of the previous ruling.
A hearing has been scheduled for July 1.
