Leave Mining Alone!

Nevada Legislature concluded its special session last week. The special session was convened by Governor Steve Sisolak to address the budget shortfall caused by the COVID crisis. While several areas were cut, one recurring theme made its predictable re-entry: Higher taxes on mining.

Over the past several sessions in the legislature – and with ballot measures away from the legislature – Democrats have attempted to increase the taxes on mining and failed. If it weren’t for the people of Nevada – and the Republicans in the legislature – who rejected the proposed increase of mining tax, Democrats would have succeeded in making mining less competitive like they have so many other industries.

As a brief history, Nevada was founded on mining. In the nineteenth century, this is the state where people came to turn their dreams to reality. John William Mackay (after whom the Nevada School of Mines and the Nevada Football Stadium is named) is one of many who went from rags to riches in this state. These pioneers mined their way to success, and along the way, overcame significant challenges. These miners risked their lives to make a living and on whose hard, manual labor this state was built.

Today, Mining pays nearly $300 million in total taxes every year. Half of the net proceeds tax levied on the mining industry goes to the local governments. Mining provides high paying jobs with an average salary of $90,000. The mining industry pays one of the highest payroll taxes in the state. Manufacturers such as Cashman are in Nevada, because well over three quarters of their business comes from supplying products to the mining industry. America is a world leader in the production of precious metals like Gold and Silver, thanks to Nevada’s mining industry. Circuit boards, which are the primary component of all electronic equipment including computers, need gold and silver as inputs in the manufacturing process. Would you depend on good old Nevada miners in Lander County for your computers and other electronic goods or would you prefer to be held hostage by communist China?

Back to the mining tax, AFSCME, the union that represents the state employees, contributed over a quarter million in the last quarter to Democrats knowing fully well there will be a special session. Coincidentally, the Democrats reduced the planned furlough of state workers. Does anyone really believe that a mining tax would have been attempted by the Democrats had the mining companies contributed a quarter million to the Democrat party? Most of the Democrat legislators come from Clark county. Does anyone really believe that the Democrat legislators would try to increase the taxes on mining if the mines were in Clark county? Let’s call a spade a spade: tax on mining will result in redistribution from poor rural counties to politically powerful Clark county.

One final point: This great state became part of the union in the middle of the Civil War to ensure President Lincoln’s reelection. Without concessions made to mining, the constitution of this state would not have passed, and Nevada would not have become part of the union in 1864. Mining was, and will for the foreseeable future, be Nevada’s heartbeat. Mining, over the last sesquicentennial, has built many cities around the state. Hotel Mizpah in Tonopah was once the tallest building in the state, thanks to mining. Even today, the haunted “Lady in Red” suite at Mizpah is the stuff of legends and is part of the history of this great state. Those who call this state home should respect the storied history of this state and mining’s continued contribution and stop trying to squeeze every last penny out of it.