Taxes raised in Nevada will be paid to California if a bill passed by the Nevada Senate Tax Committee becomes law this year.
Under Senate Bill 94, transient occupancy tax will be increased from 10 percent to 12 percent in the Tahoe township part of Douglas County, i.e. in the Stateline casinos, and most of the increase will be given to the city of South Lake Tahoe to help fund a convention center.
The Senate has to vote on SB94 and pass it with a two-thirds majority, and then the bill will go before the Assembly. If passed, the bill is set to go into effect on July 1, 2007.
Douglas County Manager Dan Holler and the Douglas County commissioners support SB94. Their reasoning is that the convention center will stimulate the sagging gambling industry at the Stateline casinos, partly caused by a new Indian casino in El Dorado County.
Of course, the commissioners did not give the voters of Douglas County any opportunity to vote on the tax increase before they endorsed raising taxes and giving the money to another state. Are they setting a precedent here to contribute to other California projects? Do they remember that many people who have moved to Douglas County in recent years previously lived in California, and that these people were motivated to leave that state in part because of the California tax system?
Nevada residents who work in California pay California income tax. If they use a car to travel to work, they are also charged a yearly commuter tax for that privilege. This is blatant taxation without representation, a war was once fought over this very issue, and Nevada does not impose any similar taxes on Californians who work in Nevada.
The convention center is to be used for concerts and conventions, but there are other concert venues already in existence at the casinos.
The casinos also have more than 100,000 square feet of convention and meeting space at present. (figure of 106,000 square feet was obtained by adding the numbers given by the five Stateline casinos).
These facilities are not being used to their maximum right now, and there are no advance pledges from any organizations that they will use the new convention center, so why build something that may well turn out to be a financial disaster?
Remember, South Lake Tahoe does not have a good fiscal record: the revenue from the parking garage at the bottom of the gondola does not even service the interest on the bond. Since Nevada has a 10 percent entertainment tax, the state will also lose that additional revenue if concerts are held in California.
Some of our politicians are preparing to gouge the tourists - the people on whom our economy depends - yet again and hand the proceeds to another state.
Have these politicians considered the radical idea of lowering occupancy and sales taxes to encourage more people to visit our area?
The city of South Lake Tahoe lies in El Dorado County, so the administration that gave permission for the Indian casino that in turn directly contributed to a decline in gambling on the Nevada side of South Lake Tahoe, is now going to be rewarded with money from Douglas County.
This is in addition to monies being paid by the Shingle Springs Miwoks to El Dorado County as announced on Sept. 28, 2006. (see www.co.el-dorado.ca.us/bos/CasinoSettlement.html)
Under this agreement, El Dorado County gets $192-$212 million over 20 years, $78-$98 million of which is to ensure that local businesses are not placed at a competitive disadvantage. None of these monies will go to the Nevada casinos at Stateline.
Does all this seem fair to Nevada or its tourists?
Those who stand to gain most if the convention center/hotels/condos/retail outlets are built are the private developers involved. They are not spending money because of philanthropic motives but because they expect to make a great profit from the condos they will sell and the retail outlets they will lease out.
Vail, Colo., is a community very similar to Lake Tahoe in that the economy is dependent on tourism and skiing. In 2003, Vail voted to build a convention center to be funded with increases in the lodging tax. At present sales tax in Vail is 8.4 percent and lodging tax is 9.8 percent. However, by 2005, public opinion had changed,
in part due to a report written for the Brookings
Institute by Professor Heywood Sanders of the University of Texas at San Antonio.
Sanders says, "The new private investment and development that these centers were supposed to spur - and the associated thousands of new visitors - has simply not occurred. What is not needed are more big bets on convention centers , the latest in a long line of highly-touted 'silver bullets' for struggling cities."
With the overall convention marketplace glutted and in decline, according to Sanders, the local chase to build glitzy meeting spaces, expand existing centers, or-even worse, subsidize convention center hotels-often yields taxpayers debts, not
profits.
The changing opinion is reflected in letters to the editor of the local paper, the Vail Daily of Oct. 27, 2005, (www.vaildaily.com).
On Nov. 8, 2005, Vail voters rejected a ballot question seeking tax increases to build a conference/convention center.
Now Vail is negotiating with a private development company from Texas to tear down a parking garage in the center of town and, in its place, build a civic and convention center (22-25,000 sq.ft.), two hotels, condos and time-share units, retail outlets, restaurants and more parking spaces. The developers would also have to build affordable housing for workers, like Tahoe, many of the hotel workers in Vail cannot afford to live in town - and the developers are also pledging that they will be responsible for any losses made by the convention center.
The convention center project in Vail differs in several important points from that proposed for South Lake Tahoe: the voters in Vail have had multiple opportunities to vote on proposed tax increases to fund the project and also the current proposal includes a pledge from the developer to cover losses incurred by the convention center. A similar assurance has not been forthcoming from the South Shore developers - I am certain it would have received wide publicity if there had been one. In addition, Vail does not have as much convention/meeting space as the Stateline casinos have at present, yet the proposed Vail convention center is half the size of the one planned for South Lake Tahoe. Also the Tahoe developers do not have any affordable housing in their project.
Act now before it is too late. Make your opinions known to the politicians before they railroad this measure through, setting a dangerous precedent for Nevada and that means our taxes to be given to California in return for absolutely nothing. Go to
https://www.leg.state.nv.us/74th/opinions/Poll/?CFID=172994&CFTOKEN=73355863 and vote against SB94.
-- Janet Marlborough is a Stateline resident.
