Four companies in northern Storey County believe the presence of a brothel reduces the value of their property, but the county's Board of Equalization doesn't agree.
All four companies were denied Wednesday their requests for reductions in property taxes by the Storey County Board of Equalization.
With assessed valuations reaching well into the millions, DP Operating Partnership, Kal Kan Foods, Roybridge Investments and Alcoa appealed to the board, saying the construction of Wild Horse Canyon Ranch and Spa, a brothel slated for completion in northern Storey County's Truckee river corridor in July, was lowering property values.
In addition to a reduction in the valuation of the square footage in their buildings, the companies asked for about 15 percent reductions in property taxes, according to Doug Walling, a member of the Board of Equalization.
"The collective reasoning was that the proposed brothel would injure their potential for business success," he said. "But they had no factual evidence that their property values would be lower. Their arguments were all based on projections, all blue sky and nebulous at best. They can project all they want, but the brothel is not built yet and the Board of Equalization can't base their decisions on projections."
Attorney Gary Duhon, who has represented most of the companies in the past, said they have concerns regarding the methods used when assessing property values. They believe the county's methods do not reflect the true market value and the matter will be appealed to the State Board of Equalization.
Sharon Claassen, Storey County's deputy district attorney, said the companies challenged the values at the last minute and the necessary appeal forms had not been completed before the hearing. She contends the primary issue is the brothel, not Storey County's property assessment methods.
"Our position is that there is no proof that the brothel is a detriment, let alone how much money we could be talking about," she said. "People are still buying property (in the area) and there's no indication that the brothel is affecting anyone."
Construction of the brothel has been a bone of contention for the companies since it was first approved by Storey County Commissioners in early January.
Filing in District Court in mid-January, Kal Kan Foods and Roybridge Investments Limited charged the licensure process was "arbitrary and capricious."
DP Operating Partners filed motions aimed at stopping construction of the brothel. District Court Judge William Maddox denied those requests, a decision recently reinforced by Nevada's Supreme Court.
