District Judge James Wilson’s ruling, which was made public Monday, sided with a business coalition called the Committee to Protect Nevada Jobs in saying the measure doesn’t comply with the “single-subject requirement.”
“Imposing a tax to support Nevada schools and changing current tax law to make certain tax record information public are not functionally related and germane to each other in a way that provides sufficient notice of the general subject of ... the proposed initiative,” Wilson wrote.
The measure backed by the Nevada State Education Association and Nevada AFL-CIO seeks to impose a 2 percent margins tax on businesses that gross more than $1 million annually. Supporters say it would generate about $800 million annually and increase funding for K-12 education.
The initiative also called for the state taxation department to publish the name of each business that has paid the margin tax, and the amount paid, in an online database. Gary Peck, executive director of the Nevada State Education Association, said Monday that the revised initiative will drop that segment.
“We are heartened at the judge’s decision,” Peck said. “He rejected one provision in the entire initiative petition.”
The business coalition had argued that the measure’s description of effect — a required synopsis limited by law to 200 words — fails to adequately explain the initiative’s ramifications.
The judge sided with sponsors, saying the synopsis was sufficient.
If the measure is reworked and it proceeds, initiative sponsors will need to collect more than 72,000 signatures by Nov. 13 to send the issue to the 2013 Legislature. If lawmakers fail to act or reject it — a likely scenario — the issue would go to voters in 2014.
Peck said he’s confident the measure will survive other legal hurdles and will ultimately succeed.
“We will gather enough signatures to qualify it,” Peck said, “and the Legislature or the people of Nevada will enact the margins tax because they know the system is badly broken and we need a dedicated and stable source of revenue.”