Being a county commissioner is a tough job. It requires responsibility not only to the wishes of the people, but also to their interests. Sometimes it seems the two are in conflict, but this is indicative of what happens when people are passionate about an issue, but not fully informed. Difficult decisions are placed before these five people on a regular basis and it is hard to craft win-win solutions when the issue is as divisive and momentous as the one that is now before them.
In 2002, when the Sustainable Growth Initiative was passed, there were a number of flaws with the initiative. Perhaps the greatest flaw was the lack of understanding regarding the potential revenue shortfalls and service impacts the initiative could cause. The voters were given a stark choice: pass a draconian growth control ordinance, or have rampant growth. Little else was provided in the way of background information to the voters. The majority voted for SGI because the choice was truly "between the devil and the deep blue sea."
Now, after endless legal wrangling that started in 2002 and is still going on to this day, the county commission is considering another growth control ordinance. The difference today is that our elected officials have a range of choices they can make. All of us now know a great deal more than we did then. For instance, we now know since the release of the U.S. Geological Survey water study in late 1996 that water is not the resource constraint to growth as was touted by the proponents of SGI in 2002. Neither the county nor the voters knew this at the time.
We now know, thanks to the fiscal impact analysis commissioned by the Coalition for Smart Growth, that the fiscal impacts of limiting residential building permits to 280 per year will be devastating in terms of fiscal and service impacts to Douglas County residents. It seems that the tax structure in Nevada favors growth. Over 10 years, about $124 million in revenue will be lost, and to make up these revenue shortfalls, dramatic cuts will need to be made. In 1996, the county commissioners proposed spending $32 million to buy a ranch to control growth, and they were nearly run out of town. By comparison, that deal now seems quaint. The voters did not know about the financial and service impacts of what they were voting on in 2002, but our elected officials do now.
The voters in 2002 could not have predicted that the 2005 legislature would cap future residential property tax increases to 3 percent. This is important because it places an absolute limit on the second largest revenue generator (a very close second, I might add) for the county, without regard to cost of living increases, housing prices and general inflation that county government has to budget for in order to maintain an adequate level of service to the community. This limitation actually puts even greater significance on growth, since the highest valuations will now come from new development. This instance provides perhaps the best example of why the County should not put itself in a regulatory box. If the commissioners choose to adopt a growth management ordinance, it needs to be one that is flexible enough to be able to also address the service demands and fiscal needs of the community.
Here are some suggestions giving the flexibility that I speak of:
• I have listed this first because I feel it is the most important: establish a requirement to revisit the growth cap every five years, concurrent with the five-year CIP and the major master plan update cycle. You should also consider a five-year budget projection for strategic planning purposes concurrently with this review. Do not establish a growth rate without knowing what impacts the rate will have on the budget and service levels in this community and what the strategy is to deal with them.
• Recognize that there are projects exempt from the growth control ordinance. Account for this and update the absorption rate of these exempt projects every five years when you reexamine the growth rate. Do not make gross assumptions that all of these projects will be fully absorbed in ten years. They will not.
• Set the rate between 2 percent and a maximum of 3.5 percent as was envisioned in the master plan. Do not compound it during the five year planning period, but adjust for population growth at the end of each planning period when the rate is revisited. This will result in a somewhat slower growth rate than the percentage implies since it will not be compounded annually, and the five year interval is an acceptable period to adjust from. Ten years is too long a period to account for changing circumstances.
• Fully fund the capital improvement plan paid for by both developers and existing residents to improve roads and construct other needed public works. Set the growth rate at a higher rate initially (3-3.5 percent), and take into account exempted project absorption rates when you set the cap. Examine reducing the maximum growth rate when a fully funded improvement plan is adopted which will fill in some of the budget gaps that occur when fewer permits are issued. This will also allow larger projects to go forward and pay their fair share based on the plan rather than having to negotiate an exemption to the growth management ordinance. This is necessary since without a fully funded capital improvement plan, there is no other way to get necessary regional improvements constructed no matter what limit is placed on growth.
The financial and service impacts to the county caused by the property tax law changes together with growth control are daunting. No doubt that we will have to come to grips with reduced levels of service, higher user fees, and perhaps even a higher level of growth than proposed by SGI. With that in mind, I urge the commissioners to give the county the flexibility to use all the available tools to deal with growth and budgets, which in Nevada are inexorably tied together. Do not pass a growth cap arbitrarily, but consider and adopt an ordinance that allows the rate to be established based on a review of all the facts, which will be in the best interests of the county and its residents.
-- Keith Ruben is a Gardnerville resident and a former Douglas County planner.
