Bellagio offers to make art viewing less expensive for locals

CARSON CITY -- Mirage Resorts is asking the Legislature to clarify the 1997 law providing a tax break for those displaying certain collections of fine art.

In return for clarifying the language, Mirage Resorts is offering to make its collection of masterpieces at the Bellagio more accessible to children and to discount the admission fees for Nevadans.

"Reasonable people can disagree whether this is an incentive -- but no one can deny that this is an improvement," Harvey Whittemore, a lobbyist for Mirage, said.

What may be at stake is whether the art collection at the Bellagio is exempt from certain taxes.

Under current state law, the art must be publicly displayed 20 hours a week for at least 35 weeks a year. But there is confusion over what constitutes a "public display."

The Bellagio charges $12 for admittance. In November the Nevada Tax Commission ruled the intent of the legislation was for the art to be displayed free of charge to the public. Mirage is suing over this issue.

Mirage is proposing this compromise in Senate Bill 521:

* The exhibit will be open to school groups free of charge for 20 hours a year.

* Nevada residents will receive a 50 percent admission discount.

* Any net profits made by admission fees will be paid in taxes or given to charity.

The proposal was presented Thursday to the Senate Taxation Committee.

Current law exempts certain collections of fine art that are open to public viewing from personal property taxes as well as the most sales taxes -- except the constitutionally mandated 2 percent state sales tax. In Clark County, the sales tax ordinarily would be 7.25 percent.

But this law raised the dander of Sen. Joe Neal, D-North Las Vegas.

"They are just trying to give themselves a tax break, plain and simple," he said. "This law was written so that it just benefits one particular casino," he said.

Neal has earned a reputation for being the most vocal critic of the gaming industry within the Legislature. In fact, he is sponsoring a separate bill to entirely repeal the art-tax exemption.

Even if his repeal efforts fail, Neal said he will fight the compromise legislation advocated by Whittemore.

"I don't care if it does cut the cost of admission. It doesn't do enough. I will fight this. I will fight this all the way to the floor if I have to," Neal said.

Neal has estimated that during the first year Mirage would save $17 million or $18 million in taxes.

"That's just not right. We could use that money to help our schoolchildren," he said.

But Whittemore said the state is benefiting from the tax exemption. He said the $300 million art collection at the Bellagio is exempt from the taxes anyway because it is inventory that will be sold. So far, about $10 million in art has been sold from the collection, he said.

Whittemore said the state benefits from the bill because it encourages art collectors to share their collections with the public by displaying them.

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