LVCVA, school district battle over room taxes

Benjamin Grove and Adrienne Packer

Monday, April 12, 1999 | 10:35 a.m.

A heated debate between the Las Vegas Convention and Visitors Authority and the Clark County School District is resonating in the Legislature.

Ultimately, lawmakers will decide which group will get about $12 million a year in hotel room taxes.

"I think it's going to be a pretty big fight," said Assemblyman Wendell Williams, D-Las Vegas, chairman of the Education Committee.

At issue is 5/8 of 1 percent of the state's 9 percent room tax, paid by hotel guests.

The money now flows to the LVCVA. But the 1997 Legislature mandated that the money will be deposited in the school district's school construction fund beginning this July.

The district's construction program, which includes building 88 new schools in the next decade, will be funded by a combination of the room taxes, property taxes and real estate transfer taxes. Officials estimate the "three-legged stool" will pull in $3.5 billion in the next 10 years.

But some analysts say the district could net at least $4.1 billion as Clark County's robust economy continues.

That's why the LVCVA is arguing the district has more than enough money for construction.

LVCVA officials say the 5/8 of 1 percent is a healthy chunk -- 10 percent -- of their budget. The LVCVA creates promotions to draw tourists to the city.

The LVCVA supports a bill introduced by Williams calling for an audit of Clark County's school construction program. Convention authority officials say the audit will prove the district is flush with cash.

Williams said he is reserving judgment whether the district or the LVCVA needs the money most.

"I'm waiting to see if the (audit) reveals what the convention authority is running around telling everybody," Williams said.

If approved, the audit would not be completed for months. No price tag has yet been attached to the audit.

Other lawmakers adamantly argue that the room tax money now belongs to the district. Case closed.

"It was signed, sealed and delivered," said Assemblywoman Chris Giunchigliani, D-Las Vegas. "A deal is a deal. It was agreed to. This is the law."

Giunchigliani, the architect of the 1997 law that set up the "three-legged stool," said other lawmakers are likely to agree.

"I don't think they will go back on their word," Giunchigliani said. "It's unfortunate that this was ever brought up as an issue."

Assemblywoman Barbara Cegavske, R-Las Vegas, who sits on both the Education and Ways and Means committees, agreed that lawmakers have committed the money to the district.

"I can't imagine pulling it away from the school district," Cegavske said. "If we find something horrendous (in the audit), if we find that they don't need the money, which I can't imagine, then we'll look at it at that time."

School officials plan an aggressive lobbying campaign of their own in Carson City. They argue that voters approved a property tax freeze based on the fact that the gaming industry agreed to pay part of the school construction bills.

"We have said that we are not in the business of giving back money that we need," said Joyce Haldeman, who oversees the district's bond money."