State Archivist Departs Urging Tax Shift From Tourists To Residents

Nevada’s State Archivist Guy Rocha made the front page of the newspaper with news of his retirement. He offered, in addition to his usual ability to fascinate with his command of Nevada history, some political views. For example:

“I find it disturbing this state that has essentially been my life is, in my opinion, on the brink of disaster. You can’t cut 34 percent or more without devastating state government”… Rocha fears legislators in the coming session will cut state spending so severely that it might take decades for his and other agencies to recover.

This is a little melodramatic. The latest estimates of Nevada’s tax revenue for the next two years is that state tax revenues will be about this same for the two years starting July 1, 2007 as it was for the two years starting July 1, 2005, and that it will be about the same for the two years starting July 1, 2009. Our flat revenue is much higher than revenue was for the two years starting July 1, 2003, and that number was swollen with the largest tax hikes in many decades passed by the 2003 Legislature. Later, Rocha notes he was a history major.

Rocha parts with this:

Rocha also criticized the state’s tax structure, saying it relies too much on tourist-generated revenues and leads to wild swings in the state’s financial health.

“We need a 21st-century Nevada, and it can’t rely on tourism to keep driving the engine,” Rocha said. “Tourism will no longer be able to sustain state government unless people are satisfied with a government so small it can’t do very much at all.”

All the available evidence indicates that our ability to export taxes to visitors has led to greater tax structure stability for Nevada, rather than wild swings. The current economic downturn (the private sector is down and losing jobs while the public sector is flat and not losing jobs) started with the “locals” economy of residential construction, and for many months tourism continued to do well, and the 2001 downturn was much less severe in Nevada than most states due to how quickly tourism rebounded.

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