Lawmaker suggests plan to freeze tax assessments

Launce Rake and Stephen Curran

Tuesday, Dec. 7, 2004 | 11:05 a.m.

Senate Minority Leader Dina Titus, D-Las Vegas, said Monday that she has requested a bill that would freeze property tax assessments throughout the state at last year's level, effectively wiping out increases that in Clark County have amounted to 20 percent to 50 percent or more.

The bill will likely add more fuel to the exploding property tax debate. Titus, on one hand, downplayed the proposed measure's implications while some local government officials said it could push them further toward a financial crunch.

Titus and Assembly Speaker Richard Perkins, D-Henderson, last summer endorsed a cap on increases of 6 percent, mirroring a proposal by Clark County Assessor Mark Schofield. Titus said a simple freeze on increases would be a temporary measure that would give the Legislature the entire session to consider a permanent restraint on property tax increases.

Schofield and others have warned that the Legislature has only about a month after convening Feb. 7 to put some kind of cap in place because assessors' offices around the state would not be able to adjust the July bills unless the legislation is in place by early March.

Although legislators from both parties appear to support some kind of cap on increases, some Republicans are supporting a cap on increases of 3 percent or less, raising the possibility of a contentious split on the issue.

Schofield, fiscal analyst Guy Hobbs and local government officials have said a 6 percent cap on increases would mirror the historical rate of growth for the taxes and match the demands that local governments have faced in the cost of providing services.

Below 6 percent, Hobbs has argued, local governments would have to cut services as the county would struggle to cover the costs of a population that continues to grow by about 75,000 people a year.

Schofield on Monday said he was not familiar with Titus' proposal but said the bill request, while "intriguing" and likely to be popular with the public, could be troublesome for government entities.

"If she's suggesting that it be freezed, I think local governments and school districts are going to come unhinged," he said. "You're going to have all the local governments and school district waiting in line to give testimony about what a loss this would be."

Titus acknowledged that local governments, which with the state and school districts share property tax revenues, would take a hit, but the effect would be temporary and would be offset by assessments on new properties.

Titus, who has said she is exploring a run for the governor's office in 2006, said it is critically important to get a cap or other property tax solution that works both for taxpayers and for local governments. A cap that reflects poor or inadequate information could be a burden on either group, she said.

"They can make it for one year," she said. "It makes sense to take your time and do it right."

Titus said she is working with analysts, among them Schofield and Hobbs, to determine the fiscal impact of her proposed bill.

George Stevens, Clark County's chief financial officer, said he understood why it might be necessary to freeze the state's property taxes and that there was no consensus on how the bill would affect local government.

The county now relies on property taxes for about 30 percent of its revenue, he said.

"I understand why she's proposing what she's proposing," Stevens said. "To get the issue together and solve it in two months is not realistic. It comes down to the individual financial position of a particular government."

One of the biggest shortfalls, he said, could manifest itself in county salaries, which are obligated by collective bargaining agreements to include cost-of-living increases.

Depending on the financial health of each government, the gap could force the county to either renege on its obligations or even lay off employees, Stevens said.

"Somehow you have to pay for that and if you have zero revenue growth, how are you going to do that?" he said. "Some will be more affected than others. It just depends."

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