Nevada Teachers’ Unions: Divide and Conquer

It’s that time again, where the Nevada Democrats in the Assembly slavishly demonstrate their capacity for boot-licking by adhering to whatever nonsense the Nevada State Education Association wants.  The latest feature of the NSEA’s war on Nevada families is a margins tax, but the tax is notable for who it exempts: the gaming industry is exempt, according to The Education Initiative’s factsheet.

We felt that the Gaming Tax was such a large part of state tax receipts that it was important to
provide some relief for those paying that tax. Notice, that receipts from other aspects of the
Tourism Industry are not exempt. We felt that once we began exempting receipts beyond the
gaming tax we would run into problems deciding where to stop.

The truth is that TEI and the NSEA made a conscious decision not to rile up the largest and most politically powerful lobby in Nevada, because they wanted to divide and then conquer industry.  By sidelining the casinos, TEI and its backers in the teachers’ unions would avoid a full-on confrontation with a politically formidable foe.  Sounds a little familiar, all in all, but history lets us know what happens when we let tyrannical agendas run amok on other people with our silence.

First they came for the Socialists, and I did not speak out– Because I was not a Socialist.

Then they came for the Trade Unionists, and I did not speak out– Because I was not a Trade Unionist.

Then they came for the Jews, and I did not speak out– Because I was not a Jew.

Then they came for me–and there was no one left to speak for me.

Yes, the unions will exempt the gaming industry for now, only to turn around later and come with knives drawn for the gaming industry and its revenues.  The teachers unions are so anti-business, and so anti-capitalist, that they even disparage businesses for deducting items like depreciation and mileage and fuel from their tax bills.  After all, those aren’t real costs, they’re loopholes that enable business to avoid paying its fair share:

2) Would an unprofitable business be required to pay the tax under this IP?
Big business in this state has, for too long, avoided paying their fair share. Are there businesses
that work with accountants to minimize their tax liability, of course there are. Does the margin
tax resist tax planning strategies? Yes, it is hard to find loopholes with this tax. Does a
businessperson stop paying other taxes and fees when they are not profitable? Are they somehow
excused from the cost of business and would they not plan for that cost?

It doesn’t matter if your business is losing money, TEI and the NSEA still want that pound of flesh!  After all, it isn’t enough that you’ll still have to pay federal income taxes, sales taxes, property taxes, fuel excise taxes, and every other tax under the sun! No, you should have to pay a margins tax on your gross revenues as well, even though you haven’t yielded a profit!  Of course, it’s no big deal, because businesses will be able to plan for the cost of the margins tax, as they were able to plan for the eventualities of the 2007-2008 housing collapse! After all, they retain trained seers and psychics to anticipate years in which they will lose their shirts due to banks collapsing the economy!

They’re just greedy bastards.

Of course, hearing this message from a non-profit that paid out over $3.7 million in salaries to 27 employees in 2011 is a joke, especially considering the following:

4) Do I understand this initiative correctly that it provides an exemption from the Margin Tax
for all non-profit organizations that are 501 (c) entities? Can you provide a description or list of
the entities included under 501 (c) as this seems to be a pretty broad group of entities as I
generally recall providing an exemption to 501 (c)(3) entities, which are charitable
organizations. Can you tell me what type of organization the Nevada State Education
Association is and whether they are exempt from the Margin Tax? How much tax would NSEA
pay under the Margin Tax if not exempt? Note: NSEA is organized as a non-profit 501 (c)(5), 
which are labor, agricultural, and horticultural organizations. Second, the Margin Tax 
proposal discussed during the 2011 Session only provided an exemption for 501 (c)(3) 
entities and not all 501 (c) organizations. 
The decision was made to exempt all non-profit organizations as a matter of policy, and to just 
apply the margins tax to those organizations whose purpose is earning a profit, with an eye 
toward ensuring big businesses pay their fair share for a quality public education system. No
distinction was made between those non-profits that are charitable, and those that engage in
certain types of advocacy for their members, various constituencies, and/or the general public
and that thus foster civic engagement.

Oh, that’s right: the purpose of the Nevada State Education Association is not to earn a profit, because if it were, there’d be no way that NSEA would pay $3.7 million in salary to just 27 employees against $8.745 million in revenues.  After all, that would seem a bit excessive in the private world of for-profit business.  It might even be seen as the height of hypocrisy to pay seven officers over $160,000 apiece when your pension plan is only 70.97% funded!  And remember those “loopholes” that TEI decried when businesses claimed tax deductions and exemptions?

Each of the seven officers listed in the NSEA’s 2012 990 filing has over $11,000 in non taxable compensation, with deferred compensation (presumably tax-exempt at that) ranging up to $40,480 in 2011!  Oh, it’s different at a non-profit, isn’t it?   Those aren’t loopholes, we swear!   And with $3,892,647,000 underfunded status in their teachers’ pension fund, it’s not at all hypocritical to be giving union bosses $30,000 or more a year in deferred compensation towards retirement, is it?

Nevada’s public school employees receive generous compensation that far exceeds their private sector counterparts:

Simple calculations show that — for 2012, the most recent year for which data is available — the Nevada private sector average income was only 86.2 percent of the private sector average nationally.

When similar calculations are done for the Nevada K-12 public-school sector, however, those employees turn out to be doing significantly better financially than their counterparts, on average, across the nation. Instead, the average annual income in Nevada’s school districts is 103.4 percent of the average wage for that sector nationally.

At a time when Nevada’s public school employees are the fourth best paid public school employees in the country, TEI and the NSEA want more.  They want more, and they want it from businesses that are losing money if necessary.  At the same time, they want their own 501(c)(5) business exempted from the margins tax, because public policy and non-profit and $3.7 million in compensation for union fatcats.   And they’ll take their deferred tax burden, and their nontaxable benefits, not as loopholes but as their due for public service, mind you!

With eleven public school retirees making more than $200,000 a year in pension income, public education and non-profit work is grueling and underpaid employment with far too little appreciation shown for its workers!  You can visit Transparent Nevada and scroll through the pages of retired public employees who make six figure pensions, and realize the sheer audacity of TEI and NSEA in insisting they need to further tax failing businesses at a time when average Nevadans in in the private sector make a mere 86.2% of the national average private sector income.

It’s called greed, and the cynical ploy of the NSEA and its surrogates in exempting the gaming industry from the margins tax is the height of hypocrisy.  The gaming industry ought to perk up and get involved, because anyone who sincerely believes that the NSEA won’t come for the casinos when the political climate is right is an idiot.  When average Nevada workers make 103% of the average national private sector wage like Nevada public school employees, then Nevada’s teachers unions can talk about a raise.  Until then, the margins tax should be dead on arrival.

 Visit Save Nevada for more information on the Margins Tax, and to sign up to support our efforts to defeat it in 2014! After all…your state could be next! 

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