Las Vegas Sun

May 5, 2024

Columnist Ken McCall: No easy solutions regarding property tax issue

WE ALL LIVE IN the same valley, right?

If most of us call the fire department, we get the same fire truck.

If we call the police, it's the same police car.

Our kids go to the same bursting schools, we visit the same overcrowded parks and courtrooms, we drive on the same congested streets and highways.

We all basically use the same urban services.

So why should people living in identical houses in the same neighborhood pay different property taxes?

That's the question thousands of residents of Las Vegas and North Las Vegas who live across the street from county residents ask themselves when they stop to think about it.

That's also the question that 82.3 percent of Las Vegas voters said last November they wanted their representatives to solve -- pronto.

Las Vegas residents pay an estimated $125 more in property taxes per year on a $125,000 house than county residents.

They don't care that the Strip was invented to avoid the city, that dozens of policy decisions set up the discrepancy, that the solution lies buried deep in a tangled jungle of budget numbers.

They just know it's not fair and somebody needs to fix it.

Sadly, the last county squad assigned to the task disappeared into the equity swamp, never to return.

But Las Vegas City Councilman Matthew Callister isn't mourning the passing of the County Commission's complicated solution, which sank like a stone last week into the gurgling quicksand of jurisdictional politics -- the same quicksand that swallowed a regional infrastructure tax agreement.

Equity crusader Callister calls the proposal "overburdened" and says it met "an appropriate fate."

Now the city will be free to go ahead with its legislative proposal to create a single gaming tax district, Callister says. Such a district will "level the playing field," he says, by distributing the rich vein of gaming taxes based on population instead of geography.

Callister likes to point out that county government gets 80 percent of the gaming taxes, 75 percent of the property taxes and 64 percent of all county taxes collected -- yet it has only 43 percent of the county's population.

And that ratio will only become more lopsided. With the approval of Summerlin West, the northwest area master plan, and new subdivisions in North Las Vegas, Henderson and Green Valley, Callister estimates 70 percent of the county's population will reside in the cities.

Meanwhile, it's the unfettered casino explosion on the unincorporated Strip that will fill all those bedrooms. And because the new megaresorts are in the county, the county gets all their gaming taxes.

"Since we all share in the pain in the growth in the valley," Callister asks, "shouldn't we all share in the bounty as well?"

With a single gaming district, the cities would be able to afford to lower their property tax rates to the county's level. The county's leaders need to reach that basic equity, says Callister, if they want to sell a proposed quarter-cent sales tax increase for a water pipeline.

But not so fast, says Commissioner Bruce Woodbury and others in county government. Callister and the city are comparing apples to oranges.

First of all, the county not only works as a municipal government to residents in unincorporated areas, it provides many services to all county residents.

"We provide the entire criminal justice system," Woodbury says. "We provide the Election Department, the recorder, the assessor, the clerk -- it goes on and on. You would expect the county to receive more than a per capita share."

Besides that, he says, the cities get all the alcohol and cigarette taxes -- most of which come from sales in the county.

It may not seem fair that neighbors have to pay unequal taxes, he says, but that happens all over the country. People live in different jurisdictions, and different jurisdictions make different decisions.

"The solution needs to keep in mind what the problem is," Woodbury says. "It came from a series of decisions: While the county was holding the line on property taxes, the city was gradually allowing them to go up."

So if Callister and the city want to go for the single gaming district in the state Legislature, Woodbury says, the county is ready with its own "counter legislation."

"If we're going to talk about distributing these various urban taxes on a per capita basis, we need to talk about all of them," he says.

According to figures worked out last year by Assistant County Manager Randy Walker, that kind of distribution would give the county $20 million more than it gets now.

"We're ready to do that tomorrow," Walker says. "But I don't think the city is ready to do that."

To get to real equity, Walker says, you have to separate out what the county spends on "municipal" services and what it spends on all residents. The county invited the city to come over and hack through the budget together so everyone could at least agree on basic numbers.

"I think that's the right approach," Walker says. "But we never, ever, ever got a response on that."

Deep in the jungle, the quicksand is licking its lips.

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