City Council tightens fiscal belt

Denise Cardinal

Tuesday, Sept. 9, 1997 | 9:34 a.m.

It's as true in economics as it is in physics: What goes up must come down, says Mayor Jan Laverty Jones.

With that in mind, the Las Vegas City Council is taking precautions against any withering of business at downtown casinos, and the withering of tax revenue that would result.

Jones and the Las Vegas City Council directed administrators Monday to draft fiscal policies that are more conservative.

The council expressly mentioned new policies on bad-debt write-offs, tax refunds, capital improvements and purchasing.

Jones requested the policy changes because she wants to be ahead of the curve in case the city's economy starts to spiral downward.

"It's proven that economies are cyclical," she said. "We've increased our room inventory by 15 percent, and increased our visitor numbers by 6 to 7 percent. We'll have to decompress sooner or later."

Councilman Arnie Adamsen agreed. He pointed out that the city isn't reacting to low gaming revenues as much as it's preparing for the alteration of those revenue sources.

"There is a shifting in the city's dynamic," Adamsen said. "People are bringing more money to shop than to gamble. And 47 percent of our budget comes from sales taxes. Only 19 percent comes from property taxes."

Clark County has taken similar measures in its budgeting, for good reason. For fiscal year 1996-97, there was only a 1.7 percent increase in the county's gaming revenue -- the lowest in the last seven years. The county's taxable sales for the same year increased by 12.1 percent, the smallest in the last four years.

Mike Alastuey, assistant county manager, said the county looked at the decline in gaming revenue when deciding its budget.

"Our forecasts for gaming revenue are very conservative," he said. "So we can take the lower revenues in stride."

Robert Barone, chairman and chief executive officer of Comstock Bank in Reno, analyzes the quarterly gaming numbers for the state. He said he commends the city for being vigilant against a downturn in the economy.

"It's a nice thing that they're doing from the taxpayers' perspective," Barone said. "They're spending our money in the best and most efficient way they can."

Barone said the gaming industry's slowing numbers have been expected for some time. No city could handle double-digit growth forever, especially a city like Las Vegas that is constantly changing, he said.

"Las Vegas has changed," he said. "It caters to much more than gamers. It can't do that without the numbers softening a little. The economy is still strong. It's nothing to be worried about."