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September 1, 2014

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Daily Memo: GOVERNMENTS:

Proven again: Home rule a lost cause

Legislators aren’t willing to give up power over cities’ purse strings

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Leila Navidi

Las Vegas Mayor Oscar Goodman says it is outrageous that state lawmakers control city taxes. He and other local officials have long sought home rule.

The issue has come up again and again in Carson City. Like clockwork, legislators who believe that cities and counties should control their own financial destinies sponsor a bill to change the law.

Like clockwork, the bill fails.

But that hasn’t stopped municipalities from complaining about the current arrangement and dreaming of a time when they might persuade the state to see things their way.

Last month, after being briefed about the 2009 legislative session and its effects on the city, Las Vegas Mayor Oscar Goodman said it is outrageous that state legislators continue to set tax policy for his city.

If he were given the chance to change one thing related to the Legislature, “the first thing is home rule,” Goodman said.

According to the Nevada Constitution, the Legislature, with certain exceptions, “shall restrict their power of taxation, assessment, borrowing money, contracting debts and loaning their credit.”

This means that cities have no right to raise or lower property, sales or room taxes.

Because there are no constitutional provisions regarding home rule for the state’s counties, they are generally in the same boat.

Nevada is one of the few states that still denies its cities home rule. According to West’s Encyclopedia of American Law, as of 2000, Nevada was just one of four states that denied any form of home rule to its cities. Alabama, Hawaii and New Hampshire were the other three.

Municipal tax experts say the current system is patently unfair to major Nevada cities and counties, which are unable to respond to fiscal emergencies by raising or adjusting taxes when necessary, without waiting for the state to do so on their behalf. Sometimes that means waiting as long as 16 months.

Crises can include the general, such as an increased budget shortfall due a slowed economy, or the specific — such as when massive rains in the mid-1980s made it necessary for the city to quickly improve its flood-control facilities.

“The notion of trying to impose one set of rules for every jurisdiction just isn’t working,” said economic adviser Guy Hobbs, who served as Clark County’s chief fiscal officer for more than a decade. “If you have an emergency, you should be able to fix it.”

For more than a decade the issue has come up in every legislative session, lawmakers say.

This year Sen. Terry Care, D-Las Vegas, introduced a bill that, initially, would have given local governments fiscal home rule. But by the time his bill was passed, it had been so watered down that it simply mandated that a study of the issue be conducted by the Legislative Commission.

Former Sen. Warren Hardy, who stepped down from the Senate after the 2009 term, said he generally supported home rule. But the Las Vegas Republican said he recognized the inherent political difficulties in passing such a bill.

“We’re not the ones who think we’re in a disadvantaged position, so why would we address it?” Hardy said, referring to state legislators.

Both Hardy and Assemblywoman Marilyn Kirkpatrick, D-North Las Vegas, chairwoman of the Government Affairs Committee, noted that legislators have two other reasons for opposing a change — one stated and one unspoken.

There are some smaller counties, and perhaps some cities as well, that would have difficulty raising enough tax revenue to support themselves, they say.

And then there’s the bureaucratic imperative never to give up power. Many legislators simply like having control over the cities’ and counties’ pocketbooks, and are not willing to cede the privilege.

As for Goodman, that means he may be out of luck — unless, of course, he becomes governor one day.

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