Andy Hafen & the Big Picture of Henderson

Last night, I stopped by a neighborhood meeting. And this wasn't just any neighborhood meeting. Henderson Mayor Andy Hafen answered questions and talked about the current state of the city at this neighborhood house party.





Last night, Hafen pointed to the many achievements of the city in recent years in explaining how strong the state of the city actually is. Forbes has named Henderson one of the safest cities in America. Bloomberg Businessweek has named Henderson one of "America's 50 Best Cities". Henderson is often considered to be the best run municipal government in Southern Nevada.

So why have Ralston, Coolican, and especially the local "newspaper" been turning up the heat on City Hall lately? It has to do with the Chris Milam stadium scandal. In recent weeks, accusations of fraud (on Milam) and corruption (in the city) have been flying all around City Hall.

Last night, Hafen cleared the air and explained his side of the story. Basically, Milam promised Henderson a stadium. Henderson, in turn, signed onto an initial agreement to support Milam's bid for vacant BLM land just south of The M Resort on the condition that Milam builds a stadium on that land. But at the last minute, Milam terminated the agreement. And on top of that, he started marketing that land for residential development! And especially considering the full inventory of our local residential real estate market, that was considered the ultimate insult.

That's why Henderson filed suit against Milam. Yet despite this brouhaha, Andy Hafen said he'd still like to see a stadium built on that land. The city just has to make sure it finds a developer who will actually abide by one's word (and not try terminating a contract at the last minute).







There was also some talk about development overall last night. The entire Las Vegas Valley has been hit hard by the "real estate bubble" bursting. One can even go around Henderson and still find vacant offices & "blue taped" houses. Yet in the past year, there have been signs of recovery. And Mayor Hafen was introspective in discussing how the city can better manage future growth.

Yet with that being said, the entire group thanked Mayor Hafen and the city for its extensive and award winning parks, trails, & recreation center network. Mayor Hafen boasted of the city's many family friendly amenities. This is something that makes Henderson quite unique in Southern Nevada, since other municipalities have historically revolved more around gaming & adult entertainment. Hafen and the audience talked about how this has aided economic diversification and neighborhood stability here.

And then, there's sustainability. Henderson was the first municipal government in Southern Nevada to adopt a sustainability plan. All around town, one can find signs of it as old street lights have been replaced by energy efficient CFL lights, landscaping & xeriscaping have converged, LEED certified buildings have popped up, and recycling has continued to be expanded & innovated. Henderson has gone out of its way to become a greener place to call home.

And it didn't end there. Getting back to economic development, there was even talk about the state of public education in the city. It's helped that K-12 schools here are considered among the best in the valley. (And it probably helps there that Henderson has many of the most affluent neighborhoods in the valley.) The group also discussed the expansion of Nevada State College (NSC). NSC has aggressively pursued public-private partnerships, and it's been pursuing students who want a four-year college education in a more intimate and flexible environment. While the city doesn't have too much say over CCSD schools, it is making sure NSC continues growing and prospering.

And that finally brings us to the Nevada Legislature. Of course, Mayor Hafen was happy that the new higher education funding formula means a much larger revenue stream for NSC. In addition, Hafen hinted at the ongoing C-Tax fight in describing how the city gets money back from Carson City. All in all, Hafen seemed encouraged by what's developing in the Legislature now.

Overall, it's a complicated big picture for Henderson. The city has certainly taken some tough punches over the last five years from both "The Great Recession" and embarrassing incidents like the Kathleen Vermillion scandal, outbreaks of police brutality, & now the Chris Milam stadium controversy. Yet with all that being said, the city is still considered the best run in the state as it piles up prestigious awards, avoids the kind of ugly labor conflicts that have plagued both Clark County & the other major cities in the valley, opens new parks just as the above mentioned cities have threatened to close parks, and pursues new economic development opportunities. It hasn't always been easy for Henderson, yet the city has managed to avoid disaster.

And with this big picture behind him, Andy Hafen runs for reelection as Henderson Mayor. Believe it or not, he answered questions from residents for over two hours last night. He certainly had plenty to talk about. And he's hoping more residents see the opportunity and progress that he sees in that big picture.

The Inconvenient Truth (of the C-Tax Saga)

It may have only been the first week, but it's been quite an action packed week for the Nevada Legislature. Even "The T Word" has reemerged as a major issue, despite some legislators' desire to sweep that under a "revenue-neutral" rug. Included in the big tax talk is the often confusing C-Tax.

The latter has particularly become a hot flash point this week as North Las Vegas protested its sharply shortchanged position thanks to the C-Tax formula. Nor'town officials, including Mayor Shari Buck, traveled to Carson City to personally make their case to legislators. Did it work? Well...

“I was not speaker when I was passionate about this, and I am just as passionate as I was back then,” [Assembly Speaker Marilyn] Kirkpatrick [D-North Las Vegas] told Buck and other North Las Vegas officials at a legislative committee meeting Thursday.

At stake is $25.8 million in additional local government tax allocations from the state to which Buck believes North Las Vegas is entitled. Buck, facing an ailing city budget, argues the additional money would bring the city up to par with other Clark County municipalities.

She said other cities get more money for their residents under a complicated formula to distribute the consolidated tax — a pot of six different levies including sales, liquor and tobacco taxes.

“That is very understandable to me. I hope it is to you also, why this formula needs to be changed,” Buck said.

Kirkpatrick, raising her voice, said she was “not going to lie to North Las Vegas residents today.”

“This formula was never based on population, and I have freakin’ said that for two years,” she said. “I never told anybody anything different.”

The tax revenue routes from the state to local governments through a labyrinthine formula are so complex it took an entire committee meeting to explain it to new legislators earlier this week. Population is one factor in that arcane equation.

The problem here is that population is just one factor in C-Tax revenue distribution. And it's outweighed by other factors, perhaps most notably property values. That's why North Las Vegas received less than half the C-Tax funding of Henderson, and much less C-Tax funding than Las Vegas.

North Las Vegas officials continue crying for help. But at this point, their cries may be falling on deaf ears in Carson City. That may be due to the array of scandals that have plagued Nor'town City Hall. But really, does that merit the state deliberately shortchanging the city?

Nor'town may now be the new butt of jokes of choice in Carson City. However, there is a serious and sinister problem lying beneath the surface. I can't help but remember what we discussed in May regarding the sorry state of Nor'town finances.

The state has also had a major role in putting North Las Vegas in this place. Remember that North Las Vegas gets far less C-Tax funding per capita than Las Vegas and Henderson. And remember that Nor'town has to pay out of its own pocket for services (like public libraries) that Las Vegas and Henderson don't.

Again, there's a glaring inequity in Nevada's tax structure, one that even affects our local governments and their finances. And it seems especially cruel that it's hitting many of Southern Nevada's poorest communities the hardest. After all, these are the communities that need things like libraries, after school programs, and crime prevention the most. And now, Nor'town is being asked to cut more.

While the City of North Las Vegas has made many poor decisions in the past on budgeting and setting proper priorities, the people of this city should not be punished simply because of their zip code... And because other municipalities were savvier in snatching away state funds. North Las Vegas, we really have a problem. And it's far deeper than you think.

Perhaps this is the key reason why Legislature leaders would rather just take down and swat away North Las Vegas emissaries as they plea for help. They continue reminding us of the pernicious inconvenient truth that so many politicians in Carson City prefer to ignore. Yet as long as they cry for help, we're reminded of why Nevada's current tax structure is failing so many of our people.

Gone With the C-Tax

Remember the C-Tax? Wait, what?

Come on, you must remember the C-Tax. The City of Fernley sued over it last year. The Nevada Supreme Court has since dismissed part of the suit while sending the rest back to district court.

But that's just the start of it. Last April, we examined how North Las Vegas also got the short end of the C-Tax stick. Long story short, Henderson received double the C-Tax revenue of North Las Vegas despite having only about 50,000 more residents (North Las Vegas has 217,482 residents compared to Henderson's 267,270 residents). And on top of that indignity, North Las Vegas must fund its own libraries while the state directly funds Las Vegas-Clark County and Henderson Libraries. Because Henderson and Las Vegas have higher property values than North Las Vegas, they receive far more state funding.

Apparently, North Las Vegas has finally had enough. During the interim, some legislators were contemplating changes to the C-Tax. Now, Assembly Speaker Marilyn Kirkpatrick (D-North Las Vegas) is championing AB 68. However, North Las Vegas officials don't think it goes far enough. So they proposed an amendment... An amendment that may blow up the entire AB 68 accord.

Attached is our proposed amendment to AB68 and an additional sheet that outlines the reasoning behind the amount of base adjustment listed in the amendment. I will tell you that we have not gotten any sign-off from the City of Henderson either on this language, the amount requested, or even if they support the amendment.

Our reasoning for including them is that all of the modeling done by the CTax Interim Committee working group reflected that both Henderson and North Las Vegas are deserving of a base adjustment. To not include them would defeat the purpose of having this one time base adjustment truly make all the cities in Clark County have an equitable starting point for the new formula reflected in AB68. It is very important to realize that by using the excess distribution this year as the source of this base adjustment - no entity in Clark County will receive less money than they received the previous year. Because AB68 will roll excess into the base going forward, if a base adjustment is determined to be prudent in a later year - entities may in fact receive less. That would not be the intent of North Las Vegas.

We simply ask for the opportunity to present our information, facts and reasoning behind this proposed amendment and that the committee give it due consideration. We in no way intend for our actions to do anything to jeopardize the passage of AB68. This amendment will start everyone on a fair and equitable base going forward under AB68.

Respectfully submitted,
Dan Musgrove
On Behalf of the City of North Las Vegas

Apparently, Nor'town thought inclusion of Henderson could help secure the amendment requesting more C-Tax funding. But instead, Henderson officials are keeping their distance from this amendment. After all, Henderson is already getting a pretty good deal from the current setup. And city officials don't want to upset Speaker Kirkpatrick, the one who seems to be calling the shots on C-Tax reform in Carson City.

What we have here is a strange mix of terrible tax policy, a possibly sincere attempt to fix it, a clash of personalities, and perhaps some brutal electoral politics as well. As we've discussed before, the current C-Tax structure may very well be a civil rights violation. Poor minority heavy communities in North Las Vegas have been chronically underfunded as wealthier and whiter communities in the state have enjoyed more state funding. There's something inherently wrong in this.

And North Las Vegas is now feeling the pressure to change this. It just so happens that municipal elections happen this spring, and Mayor Shari Buck (R) is running for reelection. Yet Henderson Mayor Andy Hafen (D) is also running for reelection in his city. And I doubt Henderson City Hall has any kind of appetite for ruining its relationship with #NVLeg leadership as both AB 68 and the broader budget are being negotiated.

So we now have another hot mess. And yet again, it revolves around Nor'town. And state legislators are reminded again of how faulty Nevada's tax structure truly is. Such is the story of our fine state.

Poor North Las Vegas

So state officials are again chiding North Las Vegas for their clusterf*ck of a city budget. And even worse, they're basically putting the city on probation.

North Las Vegas Finance Director Al Zochowski told the Nevada Tax Commission this morning that the financially strapped city will experience a small cash flow deficit in June but should end the month with slightly more than $2 million in positive cash flow.

Hacker also told the commission that the city has been meeting all of its debt obligations.

The cash flow status prompted the commission to request that North Las Vegas begin furnishing the state with regular cash flow reports as the state Department of Taxation continues to assist the city with its finances.

Zochowski and City Manager Timothy Hacker also were directed to submit a letter to the taxation department that lays out all the actions the city took to back up its proposed fiscal 2013 budget. The City Council is expected to vote on the budget Tuesday for the fiscal year that begins July 1.

Yep. It's really that bad now. But really, how did "Nor'town" get here? Well, it's complicated.

Certainly, there's a reason why it's been named one of "The 10 Worst Run Cities in America". Priorities do seem awfully out of whack at times. While a shiny new City Hall opens, direly needed parks and community centers close. And while the city continues to chase development that still doesn't make sense, more layoffs seem destined to happen.

However, there's another reason why Nor'town is destitute, a reason we certainly can't ignore. The state has also had a major role in putting North Las Vegas in this place. Remember that North Las Vegas gets far less C-Tax funding per capita than Las Vegas and Henderson. And remember that Nor'town has to pay out of its own pocket for services (like public libraries) that Las Vegas and Henderson don't.

Again, there's a glaring inequity in Nevada's tax structure, one that even affects our local governments and their finances. And it seems especially cruel that it's hitting many of Southern Nevada's poorest communities the hardest. After all, these are the communities that need things like libraries, after school programs, and crime prevention the most. And now, Nor'town is being asked to cut more.

While the City of North Las Vegas has made many poor decisions in the past on budgeting and setting proper priorities, the people of this city should not be punished simply because of their zip code... And because other municipalities were savvier in snatching away state funds. North Las Vegas, we really have a problem. And it's far deeper than you think.

What Do Fernley & North Las Vegas Have in Common? (More Than You Think...)

Last week, we were surprised by the City of Fernley filing a federal law suit challenging the current "C-Tax" revenue distribution. But in the coming weeks, will we hear more complaints about "C-Tax" inequity down south?

Long before Fernley dropped the big "game changer" law suit, the Nevada Legislature had already begun studying the current C-Tax structure to spot inequities in need of correction. Last month, this report detailing distribution of C-Tax revenue was submitted. Now pay close attention to Pages 48 & 49 in that report. Notice something strange?

Now go to Pages 168 & 169. Even though North Las Vegas has 217,482 residents compared to Henderson's 267,270 residents, Henderson receives just over DOUBLE the amount of C-Tax funds. (North Las Vegas received $36,539,000 in C-Tax funds last year, while Henderson received $73,965,000 in C-Tax funds last year.) Why? Apparently, it's all because the assessed value of Henderson properties is over double that of North Las Vegas. OK, that seems "kinda sorta" logical... But is that really constitutional?

Remember, Fernley is claiming that the current C-Tax structure violates both the 14th Amendment to the US Constitution and Article 3 of Nevada's Constitution in that it provides anything but equal protection under the law. Even though Fernley faces different structural issues from North Las Vegas, mainly that Lyon County provides police and fire services to Fernley, while North Las Vegas has to pay for its own, North Las Vegas' sad situation seems to strengthen Fernley's case that the C-Tax structure indeed denies many Nevadans equal protection under the law.

For instance, take a look at the local libraries. The C-Tax funds from the state provide direct funding to Las Vegas-Clark County and Henderson Libraries. North Las Vegas, on the other hand, has two libraries that are funded directly by the city. So in essence, North Las Vegas residents have to pay additional taxes for something that Henderson, Las Vegas, and unincorporated Clark County residents receive for no additional tax or fee. What's fair or equal about that?

Much has been said lately about the many woes at North Las Vegas City Hall. For one, many residents still question the move to a new City Hall. And it's looking increasingly possible that North Las Vegas will have to dissolve its own police and fire departments and contract with Clark County instead to save money. (Though unlike Fernley, North Las Vegas will still be paying for it regardless.) But even with that being said, should North Las Vegas residents essentially be punished just because of their zip code?

Believe it or not, Fernley may have found a real civil rights violation here. Why are some cities receiving more funding per capita than others? Yes, I know, it has to do with property values... But should that really be allowed to be a factor in what kind of local government one can expect? Should someone's zip code and/or property value determine whether one can expect a functioning library and adequate police service? Nevada, we have a problem... And it's bigger than even I had initially suspected.