Posts Tagged ‘DiCianno’

State Senate Majority Leader Requests Emergency Bill To Audit Tax Department

By Sean Whaley | 11:02 am March 14th, 2011

(Updated at 2:12 p.m. on March 14, 2011 to include new comments from Sandoval Administration)

CARSON CITY – Senate Majority Leader Steven Horsford has requested emergency legislation to conduct a performance audit of the revenue collection functions of the Department of Taxation following questions last week about the thoroughness of the agency’s review of mining tax payments.

“We were told by the head of the Tax Department that they haven’t had properly trained individuals in place for two years on the net proceeds – that’s a major problem,” he said. “I am glad that the governor is going to immediately try to address that but the question then becomes what else isn’t being properly audited at a time when we have a $2.5 billion budget hole.”

Sen. Steven Horsford/
Photo: Cathleen Allison/

Horsford, D-Las Vegas, is working with Sen. Sheila Leslie, D-Reno, the chairwoman of the Legislative Commission’s Audit Subcommittee and Chairwoman of the Senate Revenue Committee, on the precise language for the bill.

A number of the members of the Senate Revenue Committee expressed concern at a hearing Thursday when former Tax Department Executive Director Dino DiCianno told the panel that his agency has not had trained auditors to review the net proceeds of minerals tax reports submitted by mining companies, “for a couple of years.”

This at the same time gold prices have reached record levels.

Horsford asked DiCianno if he had informed former Gov. Jim Gibbons about the lack of trained auditors to review mining deductions claimed under the law, which are self reported by the companies.

DiCianno replied he had not, and that maybe he should have informed the governor.

The following day, DiCianno submitted his resignation to Gov. Brian Sandoval effective immediately.

In announcing DiCianno’s departure, Sandoval also named Deputy Director Chris Nielsen to lead the agency until the governor can appoint a successor. Sandoval asked Nielsen to begin preparing a full transition plan, including an immediate strategy to resume auditing mine operators to ensure the proper payment of the net proceeds of minerals tax. Sandoval has also directed the state Internal Audit Division to assist the Department of Taxation as it resumes the net proceeds audits.

Sandoval Senior Adviser Dale Erquiaga today said at a press briefing the governor has instructed the interim tax agency director to determine when the last mining audits were performed, which operators were audited and whether any deficiencies were identified.

The information will then be presented at a special meeting of the Tax Commission set for March 21. Sandoval may also call the Executive Branch Audit Committee together to consider evaluating other revenue sources collected by the Tax Department.

Erquiaga said there is at least one audit of a mining operator that the Tax Department is aware of. The Tax Department is required to conduct random audits so it is not clear if the 100 mining operators in the state could all be reviewed right away, he said.

Sandoval in his proposed budget made only a minor reduction in the agency funding to ensure it could effectively collect tax revenue, Erquiaga said.

“It’s bad management practice in the last administration to allow two years to go by without an audit,” Erquiaga said. “We want an explanation from the staff. We’re going to work with them to be sure going forward that doesn’t happen.”

Horsford said he does not know if the tax deductions claimed by the mining industry over the past few years are legitimate or not. The audit being requested will help answer that question, as well as whether audits of other revenues owed to the state are also being handled appropriately by the agency, he said.

“I was a little concerned about the fact that we’ve had increased revenues from mining, but also increased deductions,” he said. “So the tax payments are down.”

Horsford said the state needs to make sure the reporting is accurate.

“It’s obviously a top priority,” he said.

Leslie said one major focus will clearly be the auditing of the net proceeds of mines.

“This is a direct result of the testimony at the Revenue Committee last week which seemed to shock everyone,” she said. “That at a time when the price of gold is at record highs, we have not been auditing. And I think many of us are concerned about the whole idea of self reporting.”

The huge mining corporations likely have the best tax attorneys available to ensure they take advantage of every “loophole” in claiming exemptions from the mining tax, Leslie said.

“I’m sure they have been looking very closely at how to minimize their tax obligations, and that’s not illegal,” she said. “Right now it seems very one-sided on behalf of the mining companies.”

Leslie said she has questions about whether the mining exemptions have possibly been expanded over the years through the regulatory process that the Legislature may not be fully aware of.

The state has to ensure the exemptions are appropriate and the state is collecting all that is owed, she said.

“We’re outgunned to begin with,” Leslie said. “But the idea that we have nobody and haven’t had anybody looking at that for the last two years is preposterous. We need to be armed with our experts and right now we are unarmed.”

The mining industry has been a major target of both Democratic and Republican lawmakers already in the 2011 session. Some lawmakers have suggested the mining industry can afford to pay more in taxes and lessen the severity of cuts to education and state programs proposed in Sandoval’s $5.8 billion general fund budget.

Leslie said she wants to look at the multiple exemptions the mining industry can take on the minerals tax paid to the state and county governments and whether they are still appropriate, particularly the changes made in 1989.

Audio clips:

Senate Majority Leader Steven Horsford says the Tax Department has not been properly auditing the net proceeds tax:

031411Horsford1 :11 a major problem.”

Horsford says the question is what else has not been audited:

031411Horsford2 : 15 $2.5 billion budget hole.”

Horsford says mining revenues are up but tax payments are down:

031411Horsford3 :21 payments are down.”

Sen. Sheila Leslie says the bill request is a direct result of the shocking testimony last week:

031411Leslie1 :25 idea of self-reporting.”

Leslie says she is certain that mining companies are taking every tax deduction they can:

031114Leslie2 :13 that’s not illegal.”

Leslie says the state is outgunned in the auditing process:

031411Leslie3 :30 years is preposterous.”

Sandoval Senior Adviser Dale Erquiaga says it was bad management practice by the Gibbons Administration not to audit mining companies:

031411Erquiaga :11 that doesn’t happen.”

Gov.-elect Sandoval Names Three Additional Members To His Administration

By Nevada News Bureau Staff | 11:02 am December 16th, 2010

CARSON CITY – Gov.-elect Brian Sandoval announced today he plans to appoint Terry Johnson as director of the Nevada Department of Business and Industry in his administration. 

Sandoval also announced he will reappoint Teresa Thienhaus as director of the Personnel Department and Dino DiCianno as executive director of the Department of Taxation.

Johnson has 15 years of experience in state and local government administration.

Sandoval said Johnson will be a valuable asset to the agency and will help his administration make Nevada an even more business-friendly state.

“As the director of administration in the Clark County District Attorney’s Office and an experienced state agency administrator, Terry has the experience and the know-how to get the job done,” Sandoval said.

Previously the director of the Nevada Department of Employment, Training and Rehabilitation where he directed all daily and long-term strategic planning and management functions for the department, Johnson also served as a state labor commissioner for five years. In 1996, Johnson was an assistant business advocate at B&I in the Office of Business Finance and Planning.

Sandoval said he is pleased that Thienhaus and DiCianno will continue in his administration.

“With their years of experience, I know that each will be a strong advocate for bringing change to state government while ensuring the missions of their departments are carried out,” he said.

Thienhaus is a former senior deputy attorney general for the state of Nevada. She served as the primary personnel attorney for the Department of Transportation and the Department of Business and Industry.

DiCianno, a native Nevadan, previously served as deputy director of the Tax Department. He also has 10 years of experience in the Division of Assessment Standards as the supervisor of Centrally Assessed Properties.

Nevada’s New Tax Amnesty Program Brings In $3.4 Million So Far

By Nevada News Bureau Staff | 5:17 pm July 28th, 2010

CARSON CITY – A new tax amnesty program initiated July 1 by the Nevada Department of Taxation has brought in $3.4 million in previously uncollected revenue through Tuesday, with just over two more months to go.

Dino DiCianno, executive director of the state tax agency, said about $2.7 million of the total collected so far is sales taxes, another $500,000 is modified business taxes and the remainder is smaller amounts covering liquor, live entertainment, tobacco, business licenses and other levies included in the amnesty.

DiCianno said about $1.2 million in penalty and interest charges associated with the tax payments have been waived as part of the amnesty program.

The amnesty program, which will run for three months, was approved by the Legislature in a special session in February as a way to help close an $800 million gap in the general fund budget.

The amnesty, which will allow taxpayers to pay taxes owed without any interest or penalties, is projected to bring in an estimated $10 million to the cash-strapped state general fund.

The total tax generated so far will not all flow to the state’s general fund. Some of the tax revenue will go to support public schools and local governments.

A previous amnesty authorized by Gov. Jim Gibbons in 2008 brought in more than $27 million. It only covered sales and use taxes, business license fees and modified business taxes.

The new amnesty program, as approved in Assembly Bill 6 of the 2010 special session, is broader, including cigarette taxes, liquor taxes, insurance premium taxes and other levies.

The one-time amnesty is for businesses and individuals who owe taxes that were due before July 1, 2010 and have not been paid. The program will allow penalty and interest to be waived provided the outstanding tax debt is paid in full during the amnesty period.

Certain restrictions apply to taxpayers who have already entered into settlement agreements or offers in compromise with the Nevada Department of Taxation.

Improved Service From State Agencies Anticipated With New One-Stop Business Portal

By Sean Whaley | 3:14 pm July 15th, 2010

CARSON CITY – Companies seeking to establish themselves in Nevada should soon find a more business-like process in place to file paperwork and pay fees to the state to get up and running.

By early next year, a “business portal” unique to Nevada is expected to be operating through the Secretary of State’s office. The portal ultimately is expected to give businesses an online process to provide information required from a number of different state agencies all at one time. All required forms and fees will be accommodated through this one-stop online shop.

Upon completion of this first phase, businesses will be able to apply for and receive their sales and use tax permits, receive and renew their annual state business licenses, file articles of incorporation, file annual lists of officers and conduct other important business all in one online visit and with one online payment.

Secretary of State Ross Miller said the business portal is moving forward with the approval Tuesday by the Board of Examiners of a $4.5 million contract with Capgemini Government Solutions to implement the required technology.

“It’s a game changer,” he said. “We are far ahead of the curve of what any other state has been able to do.”

Company representatives and state agency officials met today to get the project going.

Jose Garcia, vice president of Capgemini, said he has staff in Nevada now and is moving forward with the work. The first phase will link the secretary of state’s office and the Department of Taxation. The project is ambitious but involves the type of work the company has done in other states, he said.

“We’re using the standard industry technology,” Garcia said. “I’m not saying it’s easy. It will be a challenge in that we have a tight timeline to be successful.”

Future phases are expected to link to other state agencies, such as the Department of Employment, Training and Rehabilitation, as well as local government business licensing entities. Agencies must already offer online services to link to the portal.

Dino DiCianno, executive director of the Department of Taxation, said the portal will allow the agency to use its current on-line programs and services, but will make it easier for the business community to access the information.

“The bottom line is we have to be more efficient,” he said.

Miller said that the portal will not only simplify the licensing and registration processes for the business community, it will also generate more revenue to the state by capturing fees that have not consistently been collected in the past.

A third benefit will be a reduction in the amount of state staff time and resources now required to process the information, Miller said.

The state has already seen a financial benefit with the integration of some of the functions of the Department of Taxation and the Secretary of State’s office, Miller said. Since that integration on Oct. 1, 2009, the state has collected significant amounts of previously un-captured tax revenue, he said. His office was given the task of issuing state business licenses and collecting the fees.

The first phase of the portal is expected to be operational by March of 2011. It will put Nevada “light years” ahead of other states in providing the business community with an easy-to-use process, Miller said.

No longer will someone wanting to set up a business have to visit different state agencies, fill out different forms and pay each time with separate transactions, he said.

It will also simplify the renewal process for existing businesses, Miller said.

The 2009 Legislature authorized the creation of the business portal.


audio clips:

Ross Miller says Nevada ahead of other states with the portal project:

071510Miller1 :20 of state agencies.”

Miller says portal will benefit the business community:

071510Miller2 :15 premier business jurisdiction.”

Capgemini Vice President Jose Garcia says the project is challenging:

071510Garcia :34 on the ground.”

Nevada November Taxable Sales Down Double Digits But Improve Over Prior Months

By Sean Whaley | 12:59 pm January 26th, 2010

CARSON CITY – Nevada’s taxable sales fell by 10.9 percent in November 2009 over the same month in 2008, making it the 13th month of double-digit declines in economic activity in the state. The $3 billion in goods sold in Nevada in November brought the fiscal year to date taxable sales decline to 18.1 percent.

In what might be a sign of improvement, the decline was lower than the 17.8 percent decline in October, and a 17.7 percent decline in September, according to the release by the Nevada Department of Taxation.

Gov. Jim Gibbons said: “The release of taxable sales and revenue collection data for the month of November indicates that, although revenues continue to decline in light of the sustained weakness in the housing and job markets, the pace has slowed.  The administration continues to search for ways to save money, reduce spending, and promote efficiencies in government.”

All major taxable sales categories except clothing and accessories stores, up 2.7 percent, were down in November 2009 compared to November 2008. But some of the declines were more modest than in previous months. Home furniture and furnishings were off by 1.4 percent, while general merchandise stores were off by 1.5 percent.

The largest categories continue to show a state economy that is in a protracted slowdown, however.  Motor vehicle and parts dealers were down 9.3 percent, bars and restaurants were down 10 percent, the construction industry classification was off by 44.6 percent and merchant wholesalers-durable goods were off 30.2 percent.

Thirteen of Nevada’s 17 counties recorded a decrease in taxable sales for November 2009 compared to November 2008. Only Humboldt, Lincoln, Mineral and Nye counties recorded positive taxable sales for the period.

The taxes generated by the sale of goods are a major source of revenue for the state budget. In part because of the continued slump in taxable sales, Gov. Jim Gibbons and the Nevada Legislature face a $1 billion shortfall in the current two-year budget that will require major cuts to programs and services. A special session of the Legislature to deal with the shortfall is expected in late February or early March.

The 2009-2011 budget was balanced by the Legislature using the assumption that taxable sales would decline by an average of 4.9 percent this year and grow by 2.1 percent in the fiscal year that begins July 1.

But on Friday, those estimates were revised downward to reflect an average 13.4 percent decline this year and a 4.7 percent decline next year. The difference is nearly a $183 million shortfall in this state budget revenue source alone. Assumptions for other major tax revenues were lowered as well.

Dino DiCianno, executive director of the Tax Department, said Friday during a hearing on the new revenue estimates that Nevada has a long way to go to get out of the current slump.

“I do see some glimmer of hope; there are certain sectors within the economy in this state that are starting to rebound,” he said. “But the problem is, without construction, which is a major driver, and without automobile dealerships selling cars, we’ve got a long ways to go folks, a long ways to go.”

Data from Nevada Department of Taxation