Tuesday, March 4, 1997 | 11:59 a.m.
With the Southern Nevada Home Builders Association's offer of $11 million in new tax revenue from home sales, another piece of the infrastructure funding puzzle has fallen into place.
With the $27 million in room taxes offered by the gaming industry last week, and a potential to squeeze another $10 million from local governments, that adds almost $50 million more a year to the infrastructure pot. The total comes to almost $90 million a year when a proposed quarter-cent sales tax increase to pay for water facilities is added.
But enough pieces of the puzzle are still missing to obscure the bigger picture -- namely, how much is enough to pay for Southern Nevada's growth during the next 10 years.
"That question has yet to be answered," Tim Cashman, vice chairman of the government affairs committee for the Las Vegas Chamber of Commerce, said Monday. "Until we do, I don't see where the general business community ought to be running around trying to figure out what to give."
The chamber today was set to publicly endorse the Southern Nevada Water Authority's proposal to raise the sales tax a quarter-percent to help pay for a $1.7 billion water pipeline, Cashman said.
"We know we need money for water," Cashman, president of Cashman Cadillac, said. "The water authority did its homework and is moving forward with its proposal. That is a definite need and the chamber is willing to support that because this community needs reliable, dependable water."
Home builders and the gaming industry also support the quarter-percent sales tax increase for water, and home builders support the reliability surcharge on water rates to guarantee water during a crisis.
However, the industry advocates a more broad-based as opposed to piecemeal approach to meeting infrastructure needs, said Irene Porter, executive director for the home builders.
"We look to other businesses and industries to readdress what they can and should do," Porter said, noting that the construction industry already pays about $1 billion for improvements annually.
Home builders have offered to raise the transfer tax on real estate sales by 60 cents for every $500 of value, for an additional $11 million a year. That would almost double the transfer tax on a $120,000 home from $156 to $300.
Porter said it was a more acceptable proposal than the $500 impact fee on new home sales and $250 on resales suggested by Mark Brown of the Howard Hughes Corp. Brown said he accepted the home builders' proposal.
Another suggestion of Porter's is for local governments to give up the 55 cents for every $500 they already get from the 65-cent real estate transfer tax for an additional $10 million a year to spend on infrastructure. The other 10 cents goes into a low-income housing trust fund.
Critics call the tax increase a pass-through to home buyers that doesn't affect the bottom line for home builders.
Likewise, some legislators said the 1 percent hotel room tax increase offered by the gaming industry is a pass-through to tourists that has no impact on casino profits.
Last week, the gaming industry came forward with a plan to increase the room tax by 1 percent to raise $17 million in revenue, and divert another $10 million out of a $30 million special events budget managed by the Las Vegas Convention and Visitors Authority.
Gaming officials said that $27 million could then be bonded to upwards of $400 million.
County Commission Chairwoman Yvonne Atkinson Gates said the proposals made by both industries are a sign they support a broad-based approach to paying for the community's growth.
"I see this as a cooperative effort," Gates said.
Porter said she has had discussions with Gates about the proposal, and agrees with taking a more comprehensive approach.
Cashman said he too has talked with Gates about putting an infrastructure plan together.
"She asked me if I was interested and would participate in attempting to figure out some plan where general business could contribute to community infrastructure funding requirements," Cashman said.
"It's got to be a broad-based package, like what Yvonne is trying to craft, but we should have been doing it a year ago," Cashman said.
Cashman said he would, since the industry had started down that path about a year ago, but failed because of the daunting weight of finding billions of dollars to pay for Clark County's needs.
"We still don't know what we need," Cashman said. "We've been asking for a year and still don't know what we need in the way of funding and how best to finance it."
Cashman said the business community probably would not support an increase in the business activity tax, but suggested the county could raise its business license fees.
"It's tough to speak for the business community because we have 30,000 small and large businesses in Southern Nevada," Cashman said. "To get consensus among them is, I don't know how you do it, impossible."
But a reasonable business person, he said, "should be concerned about the community's infrastructure needs and be positively disposed to play a part in solving those needs by contributing."
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