Editorial: Tax freeze unworkable

Wednesday, Dec. 8, 2004 | 9:11 a.m.

Clark County property owners would normally be receiving their "notice of value" postcards this week and next. For tax purposes, the postcards show the property's current value and the value it will have after July 1, the beginning of the new fiscal year. This year, however, because real estate values shot up dramatically, the postcards were sent in mid-November. As property taxes are based on property values, extra time was needed to handle the inevitable responses from owners, who would realize their taxes were about to shoot up as well.

True to expectations, the early mailing touched off a chorus of protest from property owners. Calculations by many of them revealed their taxes rising 40 percent, give or take a few percentage points. Clark County Assessor Mark Schofield, in June, foresaw the protest and proposed a mollifying idea -- a property tax cap of 6 percent, embodied in Nevada law. He will propose the cap to the 2005 Legislature, with the caveat that a law must be approved by early March. That would give him time to adjust all of the property tax bills by the time they go out next summer, so that no one would see such a sharp increase.

This newspaper has supported Schofield's idea. Property taxes fund the state's school districts, the courts, the 911 emergency service, police and firefighters, medical care for poor people, libraries and many other state and local governmental services whose expenses rise each year. The natural increase in property taxes -- the increase associated with rising values -- is generally about 6 percent and enough to cover the rising expenses. This means the rate at which property is taxed rarely needs to be adjusted, enabling governments to keep pace with demand without resorting to the dreaded action of increasing taxes.

When values rise as they have in the Las Vegas Valley, however, governments are in for a huge windfall at the expense of taxpayers unless something is done. While the governments, particularly here in Nevada, could use the extra money to improve our barely adequate services, taxpayers should not have to pay taxes that are hugely and suddenly disproportionate to what they have been paying. That's why Schofield called for his cap.

Schofield, however, is not the only one with an idea of how to fairly address the issue of rapidly rising property values. Sen. Dina Titus, D-Las Vegas, is now calling for property taxes to be frozen, so that the Legislature will have the entire four-month session to debate the issue of a cap. In our view, state and local governments cannot afford a freeze that would last at least a year and likely longer. We believe, given the importance of this issue, that the Legislature should forgo much of the normal silliness that goes on during the first few weeks of a new session (proclamations, etc.), and concentrate on passing a cap at least close to what Schofield has proposed.