County critical of Gibbons’ plan to take property tax

By Cy Ryan

Tuesday, May 12, 2009 | 10:22 a.m.

CARSON CITY – Gov. Jim Gibbons wants to take part of Clark County’s share of the property tax to help balance the state’s budget.

The proposal, which would transfer 4 cents of the property tax to the state, would leave Clark County in the hole by $123.1 million by the 2011 fiscal year, county officials said Tuesday.

During a hearing Tuesday, county officials said they are struggling to balance their own budget.

Clark County Manager Virginia Valentine told the Assembly Ways and Means Committee the county has not filled 450 vacant positions in county government and 200 at University Medical Center because of the municipality’s budget troubles.

George Stevens, chief financial officer for the county and the medical center, outlined an alternate plan for lawmakers that would send $53 million to state government without stripping the county of 4 cents in property tax.

Stevens said the Legislature enacted a law putting 5 cents on the property tax for state and county construction. He said that money could be diverted to the state to solve its budget problem for the next two years.

But the county would need its share of the money in two years for Beltway road construction, he said.

He said this was outlined to some lawmakers but there was a non-committal response.

Both Clark and Washoe county officials complained the state should not be siphoning money off from the local governments to solve their problems.

Members of the Ways and Means Committee listened in silence to the proposal and testimony of the counties and never asked any questions.

Andrew Clinger, director of the state Department of Administration, said the change to property tax distribution was necessary to balance the state’s budget. The collections from Washoe and Clark counties for the next two years would be $68.5 million, he estimated.

Valentine outlined for the committee a number of cost-saving measures the county has taken.

Employees of the county have made wage concessions reducing the cost of living increases and the merit pay hikes and eliminated holiday pay in certain circumstances.

The county has contracted to lease a new 1,000-bed detention facility to house less serious offenders. It will be ready to open this fall but the county doesn’t have the money to staff it, she said.

Valentine said the county’s financial picture is expected to darken further due to devaluation of commercial property, resulting in a loss of as much as $36 million in revenue in 2011.

The county is already going to lose its share of the indigent accident funds that is being swept by the Gibbons administration. That will be an annual $19 million a year loss. The legislative budget subcommittees Monday decided to reduce rates paid to University Medical Center for indigent patients – meaning the county will have to pick up more of the costs.

Jeff Fontaine, executive director of the Nevada Association of the Counties, told the Ways and Means Committee this session is looking at diverting $151 million from the counties. And that balance of that loss will fall on Clark and Washoe counties, he said.

Robert Hatfield, a long-time county official, called the plan by the governor to take the revenue “an embarrassment to the state.” He said the state should not be stripping the counties of their money to balance the budget.

He noted the counties have collective bargaining with their employees and contract – which the state doesn’t have.

The committee did not take any action.