Commission approves 3-cent room tax hike question

Douglas County commissioners cleared the way Thursday for a 3-cent increase in the transient occupancy tax - paid by visitors to hotels and vacation rentals - to help shore up sagging room tax revenues.

The tax increase will be put to county voters in the November election as an advisory question. It would increase the rate from 10 cents to 13 cents per $1 of the room rate to support tourism development and parks and recreation facilities.

If voters approve the ballot question, it must be OK'd by the Nevada Legislature.

"We need overwhelming support from the voters to take this to the Legislature," said Commissioner Doug Johnson. "Not even then is it guaranteed."

County Manager T. Michael Brown said estimates for the amount generated by each 1 percent are $400,000 at the Lake and $60,000 in the Valley.

In a report to commissioners, Brown said there has been a steady decline in transient occupancy tax generated in Douglas County. For the current fiscal year, budget revenues will need to be revised downward by about $1 million, or 17 percent, he said.

That reduces money available to support promotional activities and to fund parks, recreation, senior services and library services in Douglas County.

"Tourists will pay almost 100 percent of this tax as few county residents stay in hotel rooms or vacation rentals throughout the year," Brown said. "This is consistent with the county's position that, to the extent possible, taxes or fees imposed by a local government should have a nexus to the service, program or facility provided."

He said the proposed increase would place Douglas County in the "high middle" of other Nevada and California communities, but lower than many large communities in the western United States.

Washoe County charges 13 percent transient occupancy tax and Carson City 10 percent.