Editorial: Rights are right, and fair is fair

Monday, Feb. 11, 2002 | 8:35 a.m.

Thirty-six hotel-casinos in Southern Nevada are taking advantage of a right guaranteed to all -- to seek lower taxable values for their properties in order to reduce their property taxes. They have responsibilities to their shareholders, employees and customers to keep liabilities such as taxes to a minimum so that stocks are healthy, jobs are secure and prices are competitive. The Clark County Assessor's Office sets the taxable values every year after conducting appraisals. Property owners who dispute the values may appeal to the Clark County Board of Equalization. This board also has a responsibility -- to the public. It must make decisions based on fairness to all taxpayers. When the board meets Feb. 25 it will hear individual presentations from the hotel-casinos and the assessor's office. Then it will decide, much like a jury after listening to the d efense attorney and prosecutor.

All properties in Clark County are appraised for their taxable values once a year. Replacement value of the building and contents, improvements, and the land are among factors considered by appraisers. During appeals, income-producing properties can present evidence of diminished business. The gaming properties may argue that the terrorist acts of Sept. 11 have diminished their customer base and therefore their assessed values should go down. The initial reaction is to say that given this logic, a homeowner who lost work because of Sept. 11 should be able to make a similar argument for a reduction of his home's taxable value. But tax law does not view homes as "income producing." And it's the law that must be applied, not emotion.

So that leaves us with the Board of Equalization, whose job is to determine the fairness of taxable values strictly by law. What the board can do is evaluate the past three years of business activity within the hotel-casinos before deciding on any change in taxable values. Certainly the headlines after Sept. 11 illustrate the immediate decline in revenues. This newspaper reported, for example, that for October 2001, the win at Strip casinos was down 10.5 percent. We reported the statewide win down 7.4 percent for November 2001. A truer picture of a property's income would emerge from a three-year review. For example, here is a Sun headline from 2000: "Gaming win rises 13.9 percent in April." Here is another headline from 1999: "February Strip gaming win soars 20 percent." Examining income over time allows for a truer sense of a property's taxable value. Cl ark County Assessor Mark Schofield says his staff will tell the equalization board that the three-year perspective should b! e used in order to ensure fairness for all taxpayers. He said Sept. 11 may be considered as one factor but that it should not be the total consideration.

Altogether the hotel-casinos are expected to request approximately $2 billion in taxable value reductions. The total taxable value of properties within Clark County is $105.5 billion. The net loss in taxes if all hotels were to have their own appraisals accepted is estimated by the assessor's office at around $6 million, which should be viewed against the county's $736 million general fund budget and the city of Las Vegas's $335 million general fund budget. Granted, with the state forecasting a need for new taxes, and the double-digit growth rate that fueled government revenues in the Las Vegas Valley during the last decade over at least for now, every dollar counts. But even more is at stake Feb. 25 -- the general public's trust that all taxpayers are treated fairly. When the day is finished, we hope the board will be able to justify its decisions based o n fairness alone. The equalization board must must not automatically take the side of the county and it must not yield to t! he considerable clout of the gaming industry.