Nevada Supreme Court Reverses Course on Tax Supermajority Requirement

September 13, 2006

The Nevada Supreme Court recently overruled one of the most notorious public finance court decisions in recent years. In its 2003 decision in Governor v. State Legislature, the state’s highest court ruled that the legislature’s constitutional duty to fund education trumped the constitution’s requirement that any tax increase pass by a 2/3 vote in each legislature.

The court was asked to decide the case when the legislature adjourned without funding education because there were not enough votes to raise taxes to do so. A tax increase was necessary because a simple majority of the legislature had appropriated virtually all forecasted revenue for purposes other than education.

The Nevada Supreme Court’s original decision ordered the legislature to proceed under majority rule, even though Governor Guinn had not asked the court for such a remedy. The only party that suggested such a remedy was the Nevada State Education Association, which did so through the filing of an amicus brief.

The fallout from the case was swift, and the criticism of the opinion was widespread, though of course it also had its defenders. An attorney for the court also later resigned, apparently in protest against the court’s decision.

In a decision where they ordered that a state spending limit could not appear on the ballot this fall, the court unanimously reversed its ruling in Governor v. Legislature. This is a good development for public finance law. The Governor v. Legislature decision drove an unnecessary wedge between procedural and substantive constitutional provisions and could have served as a model for similar misbehavior in other states.

Get Email Updates from the Tax Foundation

Follow Us

About the Tax Policy Blog

Subscribe to Tax Foundation - Tax Foundation's Tax Policy Blog The Tax Policy Blog is the official blog of the Tax Foundation, a non-partisan, non-profit research organization that has monitored tax policy at the federal, state and local levels since 1937. Our economists welcome your feedback. If you would like to send an e-mail to the author of a blog post, please click on that person's name to locate his or her e-mail address or visit our staff page here.

Monthly Archive