LV officials prepare for possible legislative cuts

Diana Sahagun

Tuesday, April 24, 2001 | 10:58 a.m.

Recent moves in the Legislature have Las Vegas officials bracing for a $3 million shortfall as the City Council prepares its budget for the coming fiscal year, which begins July 1.

City Finance Director Mark Vincent has prepared a $333 million preliminary budget, in which he considers the likelihood that Assembly Bill 653 will be approved in some form. This would result in a shortfall of more than $2 million.

Assembly Bill 457 is also on the minds of city leaders, although its implications have not been factored into the budget. The bill, sponsored by Republican Bob Beers and Democrat David Goldwater, both of Las Vegas, would shift the share of the motor vehicle privilege tax collected by local governments to school districts and would cost the city about $9.5 million in the first year following passage.

AB653, sponsored by Assembly Speaker Richard Perkins, D-Henderson, concern Las Vegas and Clark County officials because it would change the distribution formula for consolidated tax revenue to reward cities experiencing rapid growth.

The City Council will conduct its first workshop to discuss the tentative budget at 9 a.m. Wednesday inside council chambers.

Henderson claims it has lost $24 million since the consolidated tax formula was changed in 1997. City officials say the revised formula shortchanged them of tax revenues and are seeking $4 million more a year. The county and city of Las Vegas would each pitch in $2 million annually under Perkins' proposal.

The loss of revenue would be felt in Las Vegas' general fund, which pays for capital improvements and projects.

"In our budget we have considered that some form of this bill might pass or that some form of this issue might be resolved by the three entities -- Henderson, Clark County and Las Vegas," Vincent said.

The city factored in a $3 million shortfall if the bill passes.

Staffing, particularly new positions and programs, would also be hurt if cuts have to be made, Vincent said.

The city requested 108 new staff positions, but the tentative budget shows funding for just 60, Of those, 40 would be in the fire department, and those positions are funded directly by the recently approved fire safety initiative. The remaining 20 positions are split among the court, detention, public works and field operations.

Nonlabor requests, which include utility and other costs associated with running the city, will increase less than 1 percent over last year.

Metro Police is also prepared to operate on a scaled-back budget should AB653 pass. Metro's Fiscal Affairs Committee has submitted a request asking the city for funding for 155 positions next fiscal year. But it also has a plan "B" -- which would ask for half the number of staff members -- and even a plan "C" -- a minimal budget that includes 24 civilian positions, which would be enough to staff new police substations.

"That would be a very scary budget, but it's something they are prepared to do if the Legislature passes these two bills," Vincent said.

Vincent said if the bill passes it would result in a 10 percent reduction in the city's consolidated tax revenue. By the first year the city could lose $9.5 million.

"I don't know how the city could absorb a $20 million reduction in revenue," he said. "Most entities can't believe this will pass, which is why it is not addressed in this budget."

Vincent said budget cuts would likely affect programs of a discretionary nature, such as services and programs for seniors and youth.

Projects that already have been funded, such as the expansion to City Hall, will not be affected by budget cuts, he said. Projects that are proposed, such as the first phase of a regional park in City Councilman Michael Mack's ward, could be targeted for cuts.

"Projects like Mack's will either end up being delayed or may have to be broken into smaller phases," Vincent said. "The reality is not as much money is going to be available for some of those discretionary projects. It's going to take longer to start them and longer to complete them."