Tax proposed to shore up Stateline tourism business

An effort to shore up Douglas County's sagging tourist industry could mean a 2-percent increase in the transient occupancy tax, levied on room rentals of 30 days or less.

Currently in committee at the Legislature, Senate Bill 94 would increase the tax from 10 to 12 percent. If successful, a $15 million portion of those revenues would be dedicated to construction of a convention center just across the state line at South Lake Tahoe, according to Michael Brown, Douglas County assistant county manager.

Mike Bradford, owner of the Lakeside Inn and member of the Lake Tahoe Gaming Alliance, said SB94 has been proposed and supported by the gaming industry. If the effort is unsuccessful, businesses will seek other means to support construction of the convention center.

"Our proposal is not to burden the county," he said. "We are levying this fee on ourselves, but it will also benefit the (Carson) Valley. The success of our business contributes to the economic health of Douglas County."

The measure has garnered some resistance from Gov. Jim Gibbons, who wants no new taxes, Bradford said.

"This tax is paid by visitors, predominantly from areas outside Nevada," he said. "We think the governor will ultimately recognize this distinction."

The $400 million project, which includes small hotels in addition to the convention center, is adjacent to Stateline casinos.

Several older shops and motels are in the process of closing their doors. The properties have been acquired and the project is going forward, Brown said.

"This project is particularly advantageous for us," he said. "It should provide a real boost for the casinos."

Lake Tahoe room tax revenues increased to over the $5.5 million mark from 1999 to 2001, but have since dropped to around $5 million and are holding steady.

Outside the Lake, room tax revenues are flat at around $750,000 annually, at a time when demand for programs supported by the fund is escalating, according to information from county officials.

Competition from Indian gaming and the price of gas are two factors contributing to the lack of growth in South Lake Tahoe's tourist industry, said Scott Morgan, Douglas County's community services director.

Skip Sayre, executive director of the Douglas County Chamber of Commerce & Visitors' Authority, said they were approached concerning SB 94 about a year ago.

"We had meetings with a majority of the lodging properties in the Valley and asked if they would be willing to support the increase," he said. "They said yes."

If approved by the Legislature, the additional transient occupancy tax would be imposed county-wide, generating an additional $160,000 for promotion in Carson Valley.

Of that 2 percent, 1.75 percent would go to the visitors authority and the remaining .25 percent would go to the other programs the tax supports, including parks and recreation and the senior center, Sayre said.

"We currently receive $300,000 from TOT (transient tax) collections," he said.

The chamber's budget totals $450,000 with grants and by leveraging the money cooperative advertising and other tools, Sayre said.

-- Susie Vasquez can be reached at svasquez@recordcourier.com or 782-5121, ext. 211.