Two Dems target LVCVA funding

Wednesday, Nov. 29, 2006 | 7:04 a.m.

CARSON CITY - Setting up what could be one of the premier showdowns in next year's Legislature, Senate Minority Leader Dina Titus and freshman Assemblyman Richard "Tick" Segerblom are looking at tapping into some of the more than $200 million that annually goes to the Las Vegas Convention and Visitors Authority to promote tourism.

Titus, the unsuccessful Democratic candidate for governor, said she has not yet decided on a specific plan on how dollars now going to the LVCVA could be used to fund other programs.

She acknowledged, however, that any attempt to siphon money from the authority would be "extremely controversial."

Segerblom wants to take 1 percent of the money - $2 million-plus - for distribution to museums. Like Titus, he concedes that it may be difficult to divert money from the convention authority, which he calls "a sacred cow."

Both Clark County Democrats have asked that bills be drafted to revise how the 9 percent room tax is distributed in Clark County.

Vince Alberta, vice president of public affairs for the authority, said the agency expects to receive about $213 million in revenue this fiscal year as its share of the hotel room tax.

The "return on investment" for the Las Vegas region, Alberta said, is impressive: 44 million annual visitors to Clark County who had an economic impact of $38 billion last year.

The authority's use of the room tax funds to lure more visitors to Las Vegas, officials note, generates sales tax revenue from tourists, which in turn helps keep other taxes down for residents. In addition, one-third of Clark County's jobs are tied to travel and tourism.

The last time that the distribution of the room tax, which is set by state law, changed significantly was in 1999, when the authority abandoned its objection to the transfer of $12 million in room tax revenue - 10 percent of its budget at the time - to the Clark County School District. The transfer had been authorized by the Nevada Legislature to help with school construction.

Currently, the authority receives 46.5 percent of the room tax collected. Of the remainder, 20 percent is distributed to Clark County and local cities; 18.1 percent goes to the School District; 11.1 percent goes for roads and transportation and 4.2 percent goes to the state Tourism Commission to promote rural Nevada.

Alberta said the authority uses one-tenth of 1 percent of the room tax revenue to make grants to organizations that submit applications.

At this early stage in the discussion, few legislators are rushing to embrace Titus and Segerblom's plan.

Sen. Randolph Townsend, R-Reno, a member of the Senate Taxation Committee, predicted that the two face high hurdles, political and otherwise.

"That will be a war - a flat-out fistfight," Townsend said of any effort to divert funds from the authority.

Sen. Warren Hardy, R-Las Vegas, said he looks forward to the upcoming debate. "It's time to have a discussion" about the money's disbursement, he said.

Sen. Bob Coffin, D-Las Vegas, who praised the LVCVA's performance, said his decision on whether to redirect dollars elsewhere would hinge on the amounts and recipients proposed.

But if the economy continues to grow, which would push up the room tax revenues, Coffin, who also serves on the Taxation Committee, said he would be "open to suggestions."

Sen. Mike McGinness, R-Fallon and chairman of the Senate Taxation Committee, said past efforts to transfer room tax revenue, even in smaller cities such as Fallon, have almost always generated controversy.

"You start messing with the room tax and people get very territorial," McGinness said. Titus and Segerblom, though, argue that some of the room tax funds that the authority now receives could be redirected without undermining its core functions.

"I don't see how 1 percent can cripple anybody," Segerblom said, calling the amount of money he hopes to spend elsewhere a "drop in the bucket" for the authority.

A minuscule reduction in the LVCVA's funding, Segerblom and Titus argue, is unlikely to have any measurable effect on local tourism, in part because all of the major resorts have their own convention centers and promotions staff.

Titus also points to several factors suggesting that the authority is anything but hard-pressed for cash. In particular, she takes issue with its attempt to sell for $1 the lucrative trademark rights to the popular "What happens here, stays here" slogan to the advertising firm that developed it. Last summer a federal judge voided the sale.

Titus said she also was displeased that the authority gave huge raises to its senior staff, including a $60,000 bonus to President and Chief Executive Rossi Ralenkotter for his success in marketing Las Vegas to the rest of the country to draw more visitors. Ralenkotter's base annual salary is $243,000.

The bonus, Alberta said, stems from the agency's "pay for performance" standards, based on annual goals.

"We had a successful year in visitors and (hotel) occupancy," he said.

Segerblom, who became the first freshman lawmaker to put in his request for bills to be drafted for the 2007 Legislature, wants to see a "small portion" of the convention authority's money devoted to the Neon Museum, the Atom Bomb Museum, the Liberace Museum, the Boulder City Museum and the proposed "Mafia" museum being promoted by Las Vegas Mayor Oscar Goodman.

Although the state's healthy surplus of more than $100 million could help fund those facilities, both Titus and Segerblom say they would prefer to establish a reliable source of income rather than simply rely on an appropriation from the 2007 Legislature.

"I'm looking for money annually as opposed to one time," Segerblom said. "This would keep the doors open on a year-to-year basis."