Area’s fiscal outlook darkens: County officials frustrated by budget shortfalls

Adrienne Packer

Wednesday, May 9, 2001 | 10:52 a.m.

As politics and personal interests swirl around three legislative proposals that would transfer Clark County revenues to the state, county administrators said Tuesday that Southern Nevada could be facing a recession.

"The picture is not as rosy as it has been in the past," County Manager Dale Askew said Tuesday.

Proof of the economic uncertainty is in Clark County's tentative budget, which will be presented to the commission during a special hearing May 21.

County Finance Director George Stevens said his office is in a holding pattern until the legislative session ends, but it is unlikely many -- if any -- of the positions requested by department heads will be granted.

"We're not going to recommend anything at the budget hearing," Stevens said.

If the three legislative proposals that would transfer county funds to the state pass, Askew said his administration could be looking at a recession similar to one in the 1980s, when there were layoffs at the County Government Center.

The push to dip into local governments' coffers to make up for shortfalls at the state level has become a common theme during this legislative session, and county administrators don't like the pattern, they say.

Southern Nevada elected officials for weeks have feared two bill proposals -- one that strips local governments of their share of motor vehicle privilege taxes and another that would take $2 million from the county and Las Vegas in a consolidated tax distribution formula shift.

But the most recent proposal, made by Senate Majority Leader Bill Raggio, R-Reno, would transfer property taxes from the county to the state.

"That one has everyone alarmed," Askew said of the proposal that shocked local governments when it surfaced this month. "Some say it's just rhetoric, but we're taking it more seriously than rhetoric because of who it comes from."

Although the proposal is not in bill form and the session ends in June, Askew said Raggio needs only a majority vote to push his proposal through. The county wants its position known, but exactly how it will relay its concerns to Carson City is a point of contention with Clark County commissioners.

Commission Chairman Dario Herrera angered some of his colleagues when he declined to participate in a joint public hearing between Las Vegas and Clark County on the bill proposals.

Commissioner Yvonne Atkinson Gates is encouraging a public hearing, but to do so without the chairman's approval she must get four votes from fellow commissioners.

Herrera, a candidate for the newly created congressional seat that will open in 2002, disputed claims he doesn't want to upset legislators who are in charge of rewriting district boundary lines that could affect the outcome of the election.

"I think the Legislature is abundantly clear on what our position is on any measure that draws away from local government; they (lawmakers) understand the drastic consequences they would have on constituents," Herrera said.

Some county officials aren't so sure lawmakers understand their point.

State officials claim Clark County has benefited most from growth through sales and property tax revenues. The state's revenue growth averaged 7 percent last year while the county's was 11 percent, Stevens said.

The county's revenue growth might have been greater, but so was its population and the money is needed to provide services, he said. Because of dwindling populations in rural communities the state has fewer residents to serve; Clark County makes up 70 percent of the state's population.

The motor vehicle privilege taxes would be taken away for two years -- a $36 million loss to county coffers. The money would fund a 2 percent statewide teachers' raise and provide books and equipment for schools.

"Education is the state's responsibility," Assistant County Manager Michael Alastuey, said.

County residents already approved not only a bond issue for the construction of schools but agreed to fund projects for the Regional Flood Control District and the Regional Transportation Commission.

Alastuey said the county shouldn't be punished by the state, which regulates nearly everything county officials do. Clark County's growth benefits the entire state -- its property tax revenues are shared equally with the state, it exports about 4 percent of its revenues to rural counties and its voters are already funding projects to help accommodate growth.

Elected officials and county administrators have wondered publicly why legislators -- some of whom have eyed positions on the county commission and city councils -- haven't raised taxes rather than encouraging local governments to do so.

"Local governments are being asked to raise taxes to make up for money taken away and diverted for state responsibilities," Askew said. "Raising taxes is a death knell for politicians, there's no doubt about it."