taxes:

Collins: Cave ceiling on property taxes

Commissioner calling on lawmakers to remove caps that he says hurt county

Steve Marcus

County Commissioner Tom Collins is unlikely to find many supporters for his proposal to lift tax caps. State Sen. Bob Coffin calls them “untouchable.”

By Joe Schoenmann (contact)

Wednesday, April 1, 2009 | 2 a.m.

Tax-me-less appeals bore fruit; didn't stop there (3-22-2009)
Court rejects property tax restraint petition (9-23-2008)
Property tax cap not pinching budgets of local cities (4-25-2006)
Changes in property tax bills get mixed reviews (7-22-2005)
Tax cap forcing cities to redo budgets (4-5-2005)

Clark County Commissioner Tom Collins is urging his former colleagues in the Legislature to ditch the property tax caps they adopted in 2005.

The limits of 3 percent annual increases on property tax bills for homes and 8 percent for businesses have outlived their usefulness, Collins contends. They were sold as a way to protect people from huge increases in property taxes caused by skyrocketing property values. Those values, however, have been plummeting for more than a year. And if the caps were eliminated, both Clark County and the state of Nevada would see large infusions of property tax revenue that would take care of many budget problems.

Collins is, in effect, arguing for what will amount to a property tax increase for some.

“It doesn’t make sense anymore to have the caps, and we and the state would be much better off if they were eliminated altogether,” Collins says.

In a report sent Friday to the state Legislature, the Clark County treasurer reported that property tax collections are expected to be $82.5 million lower this year than last year. This will be the first time since the 1993-94 fiscal year that property tax collections have decreased in Clark County.

The report also notes that without the caps, Clark County would take in $918 million more in property taxes. That’s because for the past couple of years tax caps kept tax payments artificially low. Most property owners would have been hit with property tax increases of 20 percent to 50 percent in 2006 if not for the caps.

Collins argues that everyone now needs to pay his fair share so that the county gets its fair share. The state benefits enormously from Clark County’s economy, he says, citing the recently approved hotel room tax, the benefits of which will come largely from Strip hotels. Also, Gov. Jim Gibbons has proposed taking an additional 4 cents from every $100 in property taxes, which would cull about $90 million from Clark County over two years.

“If they are going to take these local dollars, they need to let us find a way to recover that and one way would be to get rid of some of the stringent property tax caps,” Collins says. “It’s time to get rid of it.”

The Legislature has the opposite opinion regarding the timing, however. Sen. Bob Coffin, D-Las Vegas, chairman of the Senate Finance Committee, says property taxes are “untouchable” this legislative session.

“Considering the increases we are likely to make (in other taxes), no one is going to want to hear about those caps,” Coffin says. “The only way it would happen would be if the governor was successful in getting the extra 4 cents (per $100 valuation) from the counties. And I don’t think he’s going to get that.”

Collins, who served seven years in the Assembly, says when he talks now to legislators about the idea “they all get that look in their eye” — a look that says they would like to do something but can’t.

“But that’s now and it’s still early in the session,” Collins says. “We’ll see what happens later on when everyone starts getting a little more desperate.”

Collins says a measure to change property tax collections could still be added to a bill as long as that bill is related to taxes.

One person who agrees that the caps should be abolished is Guy Hobbs, Clark County’s former comptroller and chief financial officer who was chairman of a 2003 state blue ribbon committee to study taxes. Hobbs was against the caps when they were proposed.

Had the state not adopted the caps, Hobbs contends, any local politician who wanted to be reelected would have had to have worked to lower property tax rates.

To refuse to have done so would have been “political suicide,” he says. “County reserves back then were stocked.”

But the caps were politically palatable because they created a fairly normal stream of revenue and kept politicians “from having to make hard decisions,” Hobbs says.

“If they had control of property taxes, then they’d be able to decrease them when times were good, but they’d also have to increase rates when times were bad,” he says.

County Commission Chairman Rory Reid says the county’s Taxpayer’s Bill of Rights prevents the county from enacting higher tax rates without a vote of the people.

Collins has a comeback for that though: The Taxpayer’s Bill of Rights isn’t law, it’s just a policy. Under an emergency situation, he says, the policy does not prevent the county from increasing its tax rate of $2.50 per $100 of assessed value to match the highest level in the county, which happens to be in North Las Vegas at about $3.36 per $100.

“We could do it,” he says.

Discussion: 12 comments so far…

By neiman1

4/1/09 at 3:02 a.m.

Suggest removal

Raise more taxes on the strip casinos. They are all doing so well right now. It doesn't matter how many workers that would put on unemployment, as long as local government doesn't have to lay anyone off or reduce salaries. Take it from the Casinos, the goose that just quit laying.
By bob_cirelli

4/1/09 at 5:58 a.m.

Suggest removal

If the property tax caps were not in place, the governments would have created even bigger and more wasteful programs, to spend every penny of the increased property taxes.
Had that been the case, they would now be looking for EVEN MORE MONEY to get by the crunch.
NO NO NO NO NO NO NO.
Government spends, with more money available, government spends even more. The tax caps are the only way, we the people, have to keep them under control.
By Houstonjac

4/1/09 at 7:03 a.m.

Suggest removal

Based on devastating drop in home prices and the great foreclosure bust, it's time to significantly revise downward the property taxes that homeowners are forced to pay. Collins is moving in the wrong direction at the wrong time.
By 2zero

4/1/09 at 7:13 a.m.

Suggest removal

Collins is a cow pie.
By NV002025G

4/1/09 at 7:57 a.m.

Suggest removal

Cut the pay of local government workers who have collective bargaining rights. Reduce their pay to what state employees get for like work (about 37 percent lower). This will solve the budget problem with local government and at the same time give the workers a liveable wage. A lot of money would be saved that could be returned to the taxpayer. Property taxes are high enough!
Look at our neighbor to the south, Mohave County, AZ where property taxes for a given assessed value are much lower and their governmental employees do not have collective bargaining rights, yet they receive a liveable wage. It's time for action by our legislature to abolish the requirement that local governmental entities engage in collective bargaining for wages.
By texexnv

4/1/09 at 8:30 a.m.

Suggest removal

'Ol Tom is looking good since he had his lobotomy.....
By clydeperkins

4/1/09 at 8:44 a.m.

Suggest removal

Its time to bring back the lynching!
By LT2LV

4/1/09 at 9:16 a.m.

Suggest removal

People are paying $500,000 worth of taxes on homes now worth $300,000. How is that fair? If anything property taxes need to be reduced.
By jfnance32

4/1/09 at 9:50 a.m.

Suggest removal

I agree with bob_cirelli.

If there was no cap then the county budget before the crash would have been about 20% to 30% bigger.

They would have been in the same situation.

In fact, it is helping them. Every year you get your tax bill. If you think your house is not worth as much as they say then you can challenge it. Because of the cap, the tax reductions that are occurring are much less then they normally would have been. Too bad, the reporter did not report that. Sloppy reporting....again!!!!

If there is a government program to help chickens to cross the road then the pols will be screaming about it being cut.

It is extremely rare for a pol or a leftist who thinks a government spending program needs to be cut. They are all precious.
By redsoxwin

4/1/09 at 10:44 a.m.

Suggest removal

"large infusions of property tax revenue"

Is that the same as saying that property owners take it in the shorts? That's OK, cause if you complain, the 1/4% sales tax increased Tahoe driving loafers will be knocking at your door.

Something about being a public servant turns people into public thieves.....
By randucandu

4/1/09 at 12:16 p.m.

Suggest removal

Raise the cigarette tax to $1 million a pack....We'll have plenty of money then,IDIOTS
By Harley

4/1/09 at 6:25 p.m.

Suggest removal

Obviously 'Tom Collins' has failed the sobriety test.

LOL