Republicans lead from the minority

For years, senators William Raggio and Randolph Townsend have been among the more influential state lawmakers, in part because their Republican Party nearly always controlled the Nevada Senate. Raggio was the longtime Finance Committee chair and GOP floor leader, and Townsend chaired the Commerce Committee.

This year, though, without committee chairs and with their Republican Party in the minority, the two Washoe lawmakers are enjoying a control of the process unlike any they had before.

As the result of a minority control provision placed in the Nevada Constitution by an initiative petition sponsored by Jim Gibbons during his first, unsuccessful run for governor in 1994, a third of either house of the Nevada Legislature can stop any tax increase. And Gibbons himself, now governor, says he will veto any tax increase—including those that meet the conditions of his initiative petition.

In this, the biggest state budget crisis since 1983, the Democrats have control of both houses, including a veto-proof majority in the Assembly. But their majority in the Senate is not veto-proof or minority-proof. Balancing the budget without fiscal carnage depends on luring two Republican senators to vote for the final budget and tax plan.

In a GOP caucus filled with dogmatic ideologues, moderates Raggio and Townsend are the likely candidates. The two have been fuses against what they consider excessive taxes and spending on the Democratic side and against intransigence on the Republican side. When the heat has risen too high on one side or the other, Raggio and Townsend have been reminders of the cost of not cooperating.

The Democrats have been aided by Gov. Jim Gibbons, whose conduct has alienated his fellow Republicans and made it easier for them to break away from the governor. Raggio, who during the last legislature exhibited impatience with the governor’s critics (“I am tired of everybody bashing the governor all the time”), has shown less of that feeling as time has gone on. Gibbons’ budget cuts were so severe that they offended some GOP senators who have invested a lot of effort in building up some state programs. As a result, GOP concern about upholding a Republican governor’s veto is at an all-time low.

Raggio and Townsend themselves have such interests—Raggio in education, Townsend in mental health. The governor’s plan to cut the higher education budget in Nevada by a third was stillborn—Raggio and Townsend are both UNR graduates, and Townsend taught there. Raggio and other Republicans on the Finance Committee have built up the system over many years.

In his early career, Raggio carved out a role as the kind of doctrinaire conservative that now bedevils him—so right-wing that one opinion survey taken when he was Washoe County district attorney showed him with a high “antipathy quotient”—an unusually large number of people who actively disliked him.

As a state senator he has been more moderate, attracting support from groups that once disdained him. At the same time, the party was moving further right. Newcomers to Nevada GOP politics began questioning the quality of his Republicanism. At one point an Incline Village man was circulating a recording, “Won’t You Come Home, Bill Raggio?” and various party activists were calling him a RINO—“Republican in name only” (“Whose side is Raggio on?” RN&R, Nov. 22, 2000). Raggio barely took notice of them until, in 2008, he was forcefully challenged by Sharron Angle, a fringe conservative. He won 53 to 47 percent.

Townsend began his career in politics as a Democrat, bearded and in open shirts with gold chains, running a fiery populist campaign for state senate in 1976 that attacked Sierra Pacific Power Company for high rates. The battle was so fierce that the company’s president at one point threatened to sue Townsend and local businesspeople ran sleazy full-page ads with out-of-context quotes just before Election Day. Townsend lost that campaign but came back in 1980 to win the job he has held ever since.

In 1985 rumors circulated that the liberal Townsend was planning to switch to the GOP—a rumor initially considered so preposterous that Raggio reportedly responded, “Well, we do have some minimum requirements.” But the rumor turned out to be true, and Raggio wasn’t turning down any converts, no matter how liberal. The Republicans took the majority the next year.

Townsend became Commerce Committee chair, which made businesspeople think twice about attacking him.

After the 2008 election, when it was clear that Townsend and Raggio would play an unusually key role, they discussed how they would handle it. They made it plain to Democratic leaders that the cost of their support would be high. Townsend says they told the Democrats that they would not leave their caucus behind—in order to get their two votes, the Democrats would have to put together a package that could attract most of the GOP votes in the senate. “It wasn’t going to be two people,” he said. “It was going to be a majority of the caucus.”

In addition, they said Democrats would have to deal in some way with several issues:

• Changes in the Public Employees Retirement System

• Changes in the Public Employees Benefits Program

• Changes in Nevada Revised Statute chapter 288 (“Relations Between Governments and Public Employees”)

• Changes in prevailing wage practices

This made it clear that workers in government were going to be targets. It also meant that Republicans—who said there was no time for a major overhaul of the tax structure—nevertheless wanted a major overhaul of public employees issues. They said this was necessary because in order to take money away from local governments—which was supported by the Democrats and Gov. Gibbons—“you have to be able to give them [local governments] some flexibility to deal with their responsibilities.”

Can they pull it all together? This is a key week, and at this writing, the outcome is not yet clear.

“We are hopeful,” Townsend said. “We’re in the midst of those negotiations as we speak.”

Democrats—including Assembly Speaker Barbara Buckley and Senate Democratic Leader Steven Horsford—wanted to overhaul the tax system during this year’s legislative session, but that was made nearly impossible by another Raggio/Townsend demand—that all tax increases come from existing taxes, not new taxes.

“That has been one of our tenets in trying to make it very easy to implement and easy for the public to understand,” Townsend said.

That didn’t mean that the Republicans are unwilling to do a tax overhaul. Raggio is sponsor of a tax review—he avoids the term “study”—to be done during the period between the 2009 and 2011 legislatures. The 2011 session would then rebuild the tax structure, which would also give Republicans an election in which to narrow the gap between the two parties.

But there have been earlier plans—notably, in 1987-89—to overhaul the state’s tax structure that went nowhere. Aren’t Raggio and Townsend taking the chance that recession-generated urgency about Nevada’s unstable tax system will dissipate before 2011? They believe otherwise, that even if the economy is in recovery, the flaws in the state’s fiscal system will still be apparent—more so, probably, because federal stimulus funds will not be around then to patch them over.

Raggio: “I don’t see this situation [the recession] getting better within three or four years.”

Townsend: “Our [fiscal] staff is telling us it’s going to be worse next time.”