Activism in Nevada:
State Supreme Court Trumps Will of the People
to Nevada, where the state's official motto, "All for our country,"
is giving way to a new slogan "why bother?"
in the wake of a highly politicized state Supreme Court ruling setting
aside a voter-initiated state constitutional amendment.
all-too-familiar story of states raising taxes instead of reducing
spending in these times of rampant budget shortfalls has taken a
bizarre new twist in the land of high stakes and honey. Here, a
Republican governor has teamed up with the teachers union to raise
massive new taxes on businesses to fund education. On July 10,
they managed to convince six out of seven judges on the state Supreme
Court all of them Democrats to order the state legislature
to pass the governor's tax hikes by a simple majority vote instead
of a constitutionally required two-thirds vote of the legislature.
"going for broke" is a common refrain in Nevada, Governor Kenny
Guinn has taken that concept to a whole new level, choosing to interpret
his recent landslide reelection as a mandate for higher taxes and
runaway spending. Already Guinn's approval rating has plummeted
to 43 percent from the 53 percent he held before coming out in favor
of new taxes. His excuse? "It's for the kids," of course.
the "fastest growing state in the Union" isn't always easy for state
lawmakers, who are struggling to come to agreement on an education
plan for this year's budget that will keep pace with the constant
stream of new students flooding the public school systems.
governor is proposing a $1.65 billion school budget which
represents a nearly 35 percent hike in state spending that
will require about $860 million in new taxes to fund. Standing
in his way are legislators of his own party, who are rightly opposed
to passing the largest tax increase in state history, and a constitutional
amendment passed by 78 and 71 percent of Nevada voters in two successive
elections in the 1990s, which requires a two-thirds supermajority
vote of the legislature before taxes can be raised.
June 2, the regular 120-day session of the Nevada Legislature ended
with lawmakers failing to strike a compromise on, or pass by two-thirds
vote, a series of tax proposals that would impose a franchise and
payroll tax on businesses and that would go after the liquor, tobacco,
casino and live entertainment industries for new or higher taxes.
Two special sessions totaling 17 days were then held, to no avail.
It was then that the governor and the state Supreme Court took matters
into their own hands.
July 1, Governor Guinn and the teachers union asked the state's
highest court to intervene to resolve the legislative deadlock over
taxes and force
lawmakers to the negotiating table. The petitioners made the novel
legal argument that a state constitutional amendment passed
by voters during the Great Depression in 1938 which requires
the legislature to fund education, holds a higher priority under
the state constitution than the requirement for a two-thirds majority
vote on taxes.
Attorney General Brian Sandoval put it: "We just asked the court
to require the legislature to balance the budget and fund education."
Oh, is that all?
a surprise 6-1 opinion, the court agreed. Finding an "irreconcilable
conflict" between the two constitutional amendments, the court ordered
the legislature to raise "sufficient revenues to fund education
while maintaining a balanced budget." It also agreed with an argument
raised in an amicus curiae (friend of the court) brief by
the teachers union that the legislature can use a simple majority
when voting on tax proposals.
for the one dissent, it was only partial and the Justice
who is also a Democrat would have given lawmakers until July
28 to reach a consensus before intervening.
to the majority opinion: "If the procedural two-thirds revenue
vote requirement in effect denies the public its expectation of
access to public education, then the two-thirds requirement must
yield to the specific substantive educational right." In other
words, the court ruled that a "substantive" constitutional requirement
to fund schools trumped the "procedural" requirement of a supermajority
for taxes. If education is a fundamental right, there's no telling
what else in the state constitution the court might negate.
so-called "substantive" requirement on education states merely that:
"The legislature shall provide for a uniform system of common schools,
by which a school shall be established and maintained in each school
district at least six months of every year... and the legislature
may pass such laws as will tend to secure a general attendance of
the children in each school district upon said public schools."
That hardly seems like an all-powerful trump card.
Natelson, a University of Montana law professor, points out in the
Las Vegas Review-Journal, that if a conflict between two
constitutional provisions exists, the provision adopted most recently
in this case the two-thirds requirement, approved by voters
in 1996 normally would take priority over the earlier one.
court conveniently chose to ignore that fact. In essence, the Court
manufactured a "dynamic tension" between two separate constitutional
provisions to ease tension in the legislature.
court also chose to ignore other available remedies, such as suggesting
the legislature keep at it. The legislature had only met in special
session for a whopping total of 17 days. If that's the requirement
for urgent state Supreme Court intervention, a lot of other state
legislatures better get moving fast! The threat of school
closings enough was likely to ultimately lead to a political solution
in this case. And, while the court was about the business of legislating
from the bench, it could have just as easily required the legislature
to find ways to reduce spending in other places to fund education.
Suprynowicz, a columnist for the Las Vegas Review-Journal,
claims the fix was in all along. According to Suprynowicz, a retired
Nevada judge told him before the court's ruling: "Guinn went to
(Justice Bob) Rose and (Justice Miriam) Shearing on the Supreme
Court some time ago and got their agreement that they'll impose
the tax hikes. (Justice Deborah) Agosti is wavering, but it'll
probably be 6-to-1." Right he was.
the state Supreme Court's ruling, the Assembly came together on
July 14 and approved a tax increase of nearly $800 million by a
vote of 26-16.
Rep. Jim Gibbons (R-NV), the author of the initiative requiring
a supermajority, points out in the Las Vegas Review-Journal:
"Many other states have a two-thirds or higher provision in their
state laws, just like Nevada did...It strikes me as ironic that
those states managed to open their schools, educate their children
and hire their teachers without having to trash their respective
law expert John Eastman of the Claremont Institute, representing
fifteen Assembly Republicans, nine GOP state senators and concerned
business owners, won a federal temporary restraining order to halt
passage of the taxes by less than a two-thirds supermajority. However,
after a hearing on the complaint was held on July 16, where surprisingly
all seven of Nevada's federal district judges participated by audio
hookup in courtrooms in Reno and Las Vegas, the judges unanimously
ruled that they lacked jurisdiction in the matter and dismissed
plaintiffs then filed an emergency motion asking the U.S. Court
of Appeals for the 9th Circuit itself no stranger to judicial
activism to grant a preliminary injunction pending appeal.
The court denied the motion but granted the attorneys' request to
expedite the appeal process, which can take up to a year. The plaintiffs
threatened to appeal all the way to the U.S. Supreme Court if necessary.
Eastman has also said the group could seek a rehearing from the
Nevada Supreme Court, although legal experts say such petitions
are very rarely granted.
to Professor Natelson, the Nevada Supreme Court's ruling fits a
disturbing new trend in the courts when confronted with tax matters.
"The courts have been recently either striking down or finding ways
around tax expenditure limitations," Natelson told the Las Vegas
state that's hoping that trend continues is California. In the
wake of the Nevada Supreme Court's decision, the state's education
chief with the support of Governor Gray Davis has
asked the state Supreme Court to intervene in a budget stalemate
by allowing a simple majority. At least 12 other states with similar
supermajority tax laws in effect may soon follow suit.
and tax-and-spendthrifts in Nevada and around the country are, of
course, claiming victory for schoolchildren everywhere. What the
kids have really learned is that their state constitution isn't
worth the paper it's written on. That's what $800 million and an
activist court can buy you in the way of education.
July 22, 2003]
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