Henderson defends its pursuit of tax shift

Adrienne Packer

Friday, April 13, 2001 | 11:11 a.m.

As Clark County braces to lose millions because of a proposed change in the state's consolidated tax revenue formula, Henderson officials continue to defend their quest for the controversial tax shift.

Henderson lobbyists claim the community hasn't received its fair portion of tax revenues since the formula was changed in 1997. It is seeking $4 million more a year -- funds that would come from Las Vegas and Clark County coffers.

In unincorporated Clark County, the townships of Paradise and Winchester would be hardest hit, losing about $2 million and $2.5 million, respectively, over a three-year period.

If the county can't find funds to offset the loss, officials fear the tax shift that benefits Henderson would adversely affect police services, infrastructure and parks in two of the county's oldest districts.

"My position all along is we at the county would like to help Henderson, but not at the cost of taxpayers in unincorporated Clark County," said Clark County Commission chairman Dario Herrera, whose district includes Paradise.

Helping Henderson while hurting other jurisdictions is a concern of the bill's critics, who fear some unincorporated county residents would see their property taxes raised while Henderson's remain the lowest in the valley.

Because Winchester and Paradise are older, established townships, the assessed valuation of properties is stagnant, and they are not generating the amount of tax revenues growing areas do. If the county cannot find money to replace losses, it might have to resort to property tax hikes.

"Those are the people who can least afford it in Clark County; they're older homes and older residents by and large," Herrera said. "But I think we would pursue every option available to us before we would have a conversation about raising property taxes."

Not only would the county's townships suffer: the Clark County Fire District would lose $3 million over three years until a entirely new formula is created. The Las Vegas-Clark County Library District would be stripped of $1.5 million over the same period, according to a county finance report. County Finance Director George Stevens said the loss to the fire district puts the county's plan for 10 new stations over the next decade in jeopardy.

The city of Las Vegas would withstand the most significant blow, losing $16 million over three years. City Manager Virginia Valentine could not be reached for comment Thursday or today.

Henderson officials say they have lost $24 million in consolidated tax revenues -- which include sales taxes and motor vehicle privilege taxes -- since the Legislature revamped the state's formula four years ago.

They said the formula, which is based on assessed valuation of property and population, hurt the city because Henderson's portion was based on outdated population numbers.

As the county and city brace for budget losses and cutbacks, however, they're watching their neighbor to the south gain about $24 million over three years and prepare to enhance its own government services.

County officials are reluctant to speak on the record about their concerns with the proposal because they believe Assembly Speaker Richard Perkins, D-Henderson, has the power to hurt the county in the Legislature.

But county officials have wondered whether Henderson is in as dire a financial situation as city leaders say or whether funds sacrificed by Las Vegas and Clark County would subsidize Henderson projects.

There have also been questions about why the city recently began construction on a $60 million city hall if it is short on funding. And why it didn't use general revenue funds to hire more police and firefighters rather than making voters decide whether to raise property taxes to support emergency personnel.

Henderson chief lobbyist Kurt Segler said the new city hall complex is being built with capital funds designated for the project. That money couldn't have been used for the salaries of emergency personnel because the funding eventually runs out.

"The issue is that we could do one or the other, but we don't need to do both," Segler said. "That's an unfair characterization."

Segler said Henderson's population is continuing to boom, and the government needs more space for its employees. This is the last shot the city has at building on the land adjacent to its existing city center, he said.

It's also unfair to claim that Henderson is more of a residential community and that is why it keeps property taxes low but also why it doesn't receive a larger share of sales taxes.

"The fair issue is why we're doing this," Segler said. "We have tried to work within the system to receive what we feel is a fair and equitable allocation of this revenue.

"The reality is in the last three years we have had $24 million less than we would have under the old formula. That's a huge issue for us."