Editorial: Highway plan a bust

Sunday, May 13, 2007 | 7:02 a.m.

For an understanding of why Gov. Jim Gibbons' approval rating among Nevadans is a scant 30 percent, one need only examine his long-awaited announcement Thursday on how he plans to solve the state's transportation crisis.

In what should have been his most defining moment since becoming governor in January, Gibbons set forth a plan that impressed people only for its simplicity, divisiveness and self-aggrandizement.

At a time when the state needs to shore up its future by closing a $3.8 billion deficit in highway funds over the next eight years, Gibbons announced a plan that simply hearkens back to his own campaign days. No tax or fee increases, he had vainly promised.

This was his big message Thursday: He, Jim Gibbons, had come up with a way to bridge the deficit without costing Nevada taxpayers a cent. Of course, it was all nonsense - most of his plan involves borrowing billions that will cost taxpayers plenty at payback time.

More worrisome is that a disproportionate impact of his plan falls on the Las Vegas Convention and Visitors Authority. Over the next eight years Gibbons proposes to "reallocate" $420 million from room taxes generated in Clark County, taxes that would otherwise go to the LVCVA.

The authority generates billions in taxable revenue by attracting conventions and through its promotions of Las Vegas. Rossi Ralenkotter, president of the LVCVA, says if Gibbons' plan goes through, the authority will have to cancel or postpone already-approved plans for $890 million worth of improvements to the Las Vegas Convention Center.

If that happens, it's a given that Las Vegas will lose some ground in the highly competitive convention business over the next several years. Also a given under Gibbons' plan is that the authority will have far fewer funds with which to promote Las Vegas around the world.

Gaming revenue dropped slightly in March and a national poll last week showed that consumer confidence is dropping because of high gas prices - meaning the LVCVA's services are needed now more than ever if Las Vegas is to remain the top tourism and trade show destination in the country.

Simply put, in an effort to keep a promise that should never have been made, Gibbons has announced a plan that endangers long-term revenue from our tourism economy.

Unless a more broad-based plan for closing the transportation deficit takes shape, Nevada will likely experience declining revenue from tourism. To compensate, new and increased nongaming taxes will be necessary. And that necessity will have happened on Gibbons' watch.