Adjustments on hotel values near $1 billion

Mathis Winkler

Friday, March 1, 2002 | 11:07 a.m.

Twenty-three hotels convinced a Clark County board to reduce the taxable values of their properties by a combined total of about $1 billion, which local governments say will mean about $10 million less in property taxes during the 2002-2003 fiscal year than they had hoped.

Among the biggest cuts, the Aladdin, which has declared bankruptcy, saw its value slashed to $298.5 million, a cut of $320 million off the county's initial assessment. The Stratosphere's assessment was figured at $102.4 million, cut by $157 million, and the Las Vegas Hilton saw its assessment set at $210 million, a cut of $101 million.

The reductions, which county assessors say are not out of the ordinary and similar to others made in previous years, came Thursday after the hotels appealed to of the Clark County Board of Equalization.

The casino properties were revalued because of slowed business or other reasons that affect what a property is worth.

The valuations are the basis for what owners pay in property tax, and Las Vegas and other local government officials have said that the reductions might force them to cut back services in an already tight financial situation this year.

Property taxes make up about 18 percent of the city's budget and 35 percent of the county's budget.

The Board of Equalization held hearings on seven days in February to deal with 780 cases ranging from vacant lots and single family residences to billion-dollar hotel properties.

Only about 580 appeals were filed last year, Rocky Steele, the county's assistant director of assessment services, said. But the increase is not surprising as the county keeps growing, he said, and the county's valuations are below other areas of the country, because assessments cannot exceed the fair market value of properties.

Overall, board members lowered the county's initial assessed taxable property value of $105.5 billion by about $1.511 billion. That reduction is worth $15 million in property taxes. With continuing growth in the valley and additional property being added to the tax rolls each day, county assessors said they expect to make up the difference by June.

Thirty-three hotels in the county sought reductions totaling $2.3 billion, but officials only took off about $1 billion based on additional information on the value of properties submitted by the casinos.

The county's assessors calculate taxable value by determining how much it would cost to replace properties. Assessors place value on land, buildings and personal property.

Not all appeals were successful, and some hotels, such as Caesars Palace, decided to withdraw their appeal. Others managed to get a reduction, but not quite as much as they had hoped for.

Las Vegas Hilton officials sought a reduction of $166 million and submitted an appraisal of the property for $145 million.

Neither officials in the county's assessor's office nor board members were willing to go along on Thursday.

"I think that appraisal's a joke," said board member Tio DiFederico, who is an appraiser.

The board eventually reduced the hotel's taxable value from $311.5 million to $210 million, taking into consideration the casinos' drop in business.

Property owners will have to pay property taxes according to the new assessed value starting in August. They can still appeal the county board's decision to the state Board of Equalization, which will hear cases in May and take their case to the courts as a last resort.