Las Vegas Sun

September 17, 2014

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Economic diversity, new jobs are essential, leaders say

The region’s political leaders told a real estate development group that the local economy needs to be reshaped to deal with future downturns and alleviate the pain felt today with lost jobs and government revenue.

Mayors from Las Vegas, Henderson and North Las Vegas and Clark County Commission Chairman Rory Reid said that job creation needs to be a primary focus and called on the 2011 Legislature to look at ways to generate revenue and build reserves that don’t curtail local governments during the next recession.

Speaking to members of the local National Association of Industry and Office Properties last week, Reid said the county has lost about $200 million in revenue from the state. The silver lining in the weak economy is that government has become more efficient, but changes are needed to sustain growth in the future, he said.

“I think any elected official who doesn’t think about jobs and growth when he first wakes up in the morning and throughout the day and when he wakes up at 2 in the morning staring at the ceiling is confused,” said Reid, a Democrat who is expected to run for governor in 2010. “We need to fundamentally remake our economy so that every time the gaming industry gets a cold, we don’t all get sick.”

The economy must be diversified to create jobs and opportunities for the business community to grow as well, Reid said. He cited one study that showed if Nevada had developed 2,000 megawatts of solar energy in the past two years, that would have generated $13 billion in tax revenue and $1.4 billion for the state, thus filling the original budget hole, he said.

Las Vegas Mayor Oscar Goodman told the group that the state needs to change the way it does business and give local governments more authority. Las Vegas has no means to generate revenue other than some paltry fees and must rely on the state for revenue, Goodman said.

In the last legislative session, the city came close to losing its redevelopment agency, which been crucial to the development of the Cleveland Clinic Lou Ruvo Center for Brain Health, Las Vegas Premium Outlets mall and Smith Center for the Performing Arts, Goodman said. Without a redevelopment zone to offer incentives, no one would go into blighted areas near downtown Las Vegas, he said.

“We need to have a serious discussion about home rule and let the municipalities and county have the power and jurisdiction to raise money and pay for services and make sure our constituents are taken care of,” Goodman said. “With all due respect, I sometimes get the impression that when folks go up there (Carson City), they forget where they came from. It’s like they didn’t know they were elected in Las Vegas, North Las Vegas or any unincorporated part of the county.”

Goodman also suggested that consolidation of the municipal and county governments may create a powerful force that will prompt Washington and Carson City to take the region more seriously.

Henderson Mayor Andy Hafen said cities live and die off sales taxes, but that source of revenue is only reliable during a good economy. During a slowdown, it creates challenges for city governments, and he said the 2011 Legislature must develop a more sustainable source of revenue for local governments.

The state needs to take a look at corporate and individual taxes and remake sales taxes, he said.

“Nothing should be taking off the table,” Hafen said. “Now that times are tough, they have to get tougher at the legislative level when it comes to addressing taxes.”

North Las Vegas Mayor Shari Buck expressed regret that the Legislature didn’t anticipate a recession when it had a surplus of revenue.

Buck blasted the Legislature for imposing its will on the city by forcing a ward system for council elections and that its Municipal Court judges must be lawyers. Like Goodman, she said cities should have home rule.

“When you have a legislator say to our former mayor that ‘I am so glad I got elected because I get to be your boss,’ that is a problem,” Buck said.

Reid said he recognizes the Legislature has a difficult task, but it must realize that everyone is in this together and that the job of government is to provide services.

“I think it is being done backward,” Reid said of how local government is funded. “The issue is not necessarily taxes, but what we do to grow our economy. We need to first decide what we want our economy to be and determine what kind of revenues are generated based on that.”

Reid cited a 1955 issue of Colliers that could be talking about the same issues as today. It outlines the growth from tourism and gaming, and the unfinished business of delivering health care and a troubled educational system, he said.

“We don’t want to wake up in 55 years and have somebody tell the Nevada story and have it be what it has been,” Reid said. “It has to change, and it has to start with a new economy.”

Nevada and Las Vegas have to decide what they wants their future to be and then figure out how much it will cost, Goodman said. That will lead to a solution of how to pay for it because people are willing to pay to make this a great community, he said.

Goodman said too many businesses pay little or no taxes.

The slowdown in real estate and falling prices should create some opportunities in the region, Reid told the developers and real estate professionals. Land prices got so high during the boom that only homes were being built, but there are opportunities today to build warehouse and distribution facilities, he said.

Buck said North Las Vegas is promoting development at Apex industrial park and has launched a campaign to lure companies to undeveloped land.

North Las Vegas is also undertaking a program to promote North Las Vegas businesses in the community for its residents to support, she said.

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