Friday, February 8, 2013

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.

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