Wynn's art tax bill faces Assembly

UCARSON CITY -- It will probably be a lot quieter when the Assembly considers the controversial art exemption bill being pushed by Mirage Resorts Chairman Steve Wynn.

"I don't anticipate as much heat as there was in the Senate," said Assembly Speaker Joe Dini, D-Yerington, who supports Senate Bill 521. "I believe in it."

Majority Leader Richard Perkins, D-Henderson, said he wants to hear the pros and cons but adds, "I don't want it to become a big circus."

After a spirited debate Friday, the Senate approved the bill 14-7. Sen. Joe Neal, D-Las Vegas, the biggest critic of the legislation, said it gives a $15 million tax break to Wynn.

Sen. Mark James, R-Las Vegas, backed the bill, saying it carries on centuries of tradition with government encouraging the arts. People don't have the money to go to Paris to view the art in the Louvre, he said, but Wynn's $300 million collection is open to the public in Las Vegas.

The bill arrived in the Assembly Saturday. Minority Leader Lynn Hettrick, R-Minden, said he voted for the bill two years ago, adding, "They have cleaned it up a huge amount by putting in free time for students and half price for Nevadans and saying any profits on the charges goes back to the state in some fashion.

"We need to remember that all they (Wynn) would have to do is call themselves an art gallery, put up a sign and they could own all the art as inventory and pay no taxes. We make such a big stink about this issue over nothing."

The art exemption was pushed through in 1997 by representatives of Wynn. Harvey Whittemore, lobbyist for Wynn, said Saturday the casino owner was already exempt from the sales and personal property tax then because the collection was classified as inventory. He said Wynn wanted the added exemption put in the law as a double protection against the payment of taxes.

Whittemore said this bill means a person who purchases a work of art from the Bellagio or another collection won't have to pay sales or personal property tax if he or she keeps it on public display. If that person buys the painting and doesn't display it publicly, then the taxes are imposed.

This bill encourages public display of fine art, he said.

Wynn charges $12 a person at the Bellagio. After the 1997 law was passed, the Nevada Tax Commission ruled the tax exemption could not be claimed if there was an admission charge. Wynn sued and the case is pending. But the suit could be dropped if this bill is passed.

The original law gave the tax exemption to anyone who purchased a painting for $25,000 or more and put it on display at least 20 hours a week for 35 weeks each year. AB521 allows an exemption even if there is an admission charge. It provides Nevadans will get in for half-price for at least 25 hours a week between 6 p.m. and 12 a.m.

To gain the exemption, the art owner must allow free group tours by students for at least five hours for at least 20 days a year.

Whittemore said he would recommend the half-price for Nevadans section go into effect immediately, rather than waiting for passage of the bill.

The revenue collected from admissions, after expenses are deducted, must be paid in taxes to the state or donated to charity.

Neal, in his 22-minute speech against the bill, complained it expanded the exemption to those who lease valuable pieces of art. And he said it would permit a tax exemption for such things as even a carpet.

He said the $15 million in lost tax revenue would mean that public schools will not be getting $6.7 million of that. "How can we pass legislation that takes money away from kids?" he asked.

Supporters of the tax exemption say nothing is lost because no tax has ever been paid yet. And this art collection brings in additional business to the state, which collects taxes from that.

Sen. Terry Care, D-Las Vegas, said he campaigned against the tax exemption. "Art is about beauty, not about taxes or money."

Voting with Neal and Care against the bill were Democrats Bob Coffin, Dina Titus and Valerie Wiener, all of Las Vegas and Republicans Ann O'Connell of Las Vegas and Mark Amodei of Carson City.

archive