Plan to repeal franchise fees dies in committee

Nevada Sen. Randolph Townsend's bill to repeal franchise fees charged by local governments died Thursday on a 4-3 vote in the Commerce and Labor Committee. He is the committee's chairman.

The Democratic minority on the committee was joined by Sen. Sandra Tiffany, R-Henderson, in killing SB277 on a 4-3 vote.

But Townsend, R-Reno, said the battle isn't over yet.

"I'm probably not going to let this die," he said. "I believe very strongly it's the right thing to do."

Tiffany said she voted against the bill because she believes constitutional amendments limiting the growth of government spending are the way to go rather than targeting any specific tax or fee.

"If we repealed the franchise fee, local government would just find another way to raise more money. The Taxpayer's Bill of Rights is the best way to go."

Local governments pushed hard to block the bill because some of them receive more than 10 percent of their total operational revenues from franchise fees they charge. Utilities including telephone, cable TV, power and gas pay to use publicly owned rights-of-way.

Townsend, however, described it as "Nevada's hidden consumer tax," pointing out local governments collected more than $141 million from franchise fees last year.

Townsend agreed SB277 is dead. Under committee rules, it takes a two-thirds majority to revive legislation once it has been killed in committee so he would have to change two votes to revive the measure.

Instead, he said he would try get some support for a less ambitious plan - possibly phasing the tax out over a period of years.

But Townsend said he did get the attention of local governments who utilities have complained use their franchise negotiations to get such things as free TV channels and special breaks for themselves as part of the contract.

"We made our point," said Townsend.

Contact reporter Geoff Dornan at gdornan@nevadaappeal.com or 687-8750.