Mortenson not buying sales tax

Larry Henry

Wednesday, May 28, 1997 | 10:48 a.m.

CARSON CITY -- Legislative renegade Harry Mortenson finally got to put in his 2 cents -- or at least a quarter-cent -- against a plan to raise sales taxes in Clark County.

"If this were put to a vote of the people, I'd be for this bill," Mortenson, a Democratic assemblyman from Las Vegas, told the Senate Taxation Committee Tuesday. "If it's not put to a vote of the people, I wouldn't be for it."

A public vote might not be too far-fetched, Committee Chairman Mike McGinness, R-Fallon, said after the hearing.

Casino lobbyists pushing a sales tax hike in lieu of increased gaming taxes are against putting it on the ballot because advertising to persuade voters would be too expensive. McGinness also had opposed a required public vote, saying counties already have the option to do that.

But McGinness has upgraded the chances to 50-50. "We're all hearing from our constituents," he said.

Assembly Bill 291 allows counties to raise sales taxes a quarter-cent for growth needs. In Clark County, the tax would help complete a second water pipe from Lake Mead, doubling the area's 1.2 million population in 20 years.

The Assembly passed the bill after rejecting an amendment that would have put the tax before the public. Mortenson was one of only seven to vote against AB 291.

The Assembly committee studying growth didn't air Mortenson's objections, although he received publicity for trying to poke holes in the tax plan weeks before others were willing to challenge the powerful special interests supporting the bill.

He got a chance Tuesday to highlight his fight on center stage.

Mortenson, a retired nuclear physicist, told the Senate committee that Las Vegas is growing so fast that hook-up fees and water rates -- which will increase under AB 291 anyway -- can finance the $3 billion water and sewer project.

He said "simple mathematics" prove that current residents will pay more for growth under the legislation than newcomers.

Without a sales tax, hook-up fees at new homes pay 79 percent of the project, Mortenson said, displaying pie charts on an overhead projector. Current residents would pay the other 21 percent, through higher water rates.

With the sales tax added, new residents pay only 52 percent, while people who already live in Clark County, when increased water rates and a new excise tax are added to the sales tax, will pay about 35 percent.

"Are we trying to squeeze four million people into a situation where 2 million could live nicely?" Mortenson asked. "I'd rather see a Las Vegas that was beautiful ... a jewel in the desert."

Mortenson also cited a study from Price Waterhouse, a national accounting firm, that says sales taxes are unfair to poor people.

"The poor pay a larger percentage of their income (in sales taxes) than rich people," he said.

Assemblyman David Goldwater, who chairs the Assembly Infrastructure Committee, which approved the bill earlier this month, said water rates and housing costs will increase even more if the sales tax doesn't pass.

Richard Wimmer, of the Southern Nevada Water Authority, said the average residential water bill will go up $2.25 a month with a sales tax and $4.50 without it.

Irene Porter, lobbyist for the Southern Nevada Home Builders Association, said housing costs will jump $30,000 without a sales tax, though Mortenson said the increase would be closer to $5,000.

"If you want to see higher water rates and fees, I suggest you come up with an alternative solution," Goldwater, D-Las Vegas, told the Senate committee.

Ken Mahal, a senior citizen who testified from Las Vegas via teleconferencing, said one alternative source of funding is higher casino taxes.

"We believe gaming should have come to the table and paid this tax," Mahal said.

He said he agreed with Mortenson that Las Vegas is growing too fast.

"Las Vegas is a jungle," he said. " I wouldn't call it a zoo. At least in the zoo, the animals are in a cage."