Wednesday, July 28, 2004
Copyright © Las Vegas Review-Journal

EDITORIAL: Special session a good idea

Without tax cap, bureaucrats will squander windfall and cry for more

Property tax bills increased by an average of about 8 percent in Clark County this year, which parallels annual increases over the past five years, according to Clark County Assessor Mark Schofield.

But that "average" won't hold for long. In fact, the rapid escalation of local home prices is already being felt.

The median price of a new home was $239,145 in May, up 19.2 percent from a year before. And since February, the price of raw land has been increasing by 10 to 12 percent ... per month.

That affects assessed valuations even of older homes. That means some residents are already "absolutely aghast" at their latest property tax bills, according to state Sen. Ann O'Connell, R-Las Vegas.

And things only promise to get worse -- much worse.

If no cap on property tax increases is imposed, homeowners could well see their bills jump by 10 percent to as much as 50 percent one year from now, Mr. Schofield warns. How much could property taxes increase on vacant land? As much as 200 percent.

So Republican lawmakers O'Connell and Assembly Minority Leader Lynn Hettrick, R-Gardnerville, have asked Gov. Kenny Guinn to call a special session of the Legislature to impose a 6 percent cap on property tax increases.

That 6 percent figure is in need of some careful analysis and debate. The problem with tax hike "caps" is they often become minimums as well as maximums. It's simply not in the nature of the bureaucracy for anyone who'll get to spend that money to say, "You know, we're allowed to raise taxes by 6 percent, but I think we can really live with 2.5 percent, don't you?"

And why not actually reduce the underlying rates?

The other problem is that what the Legislature can grant, it can as easily take away. That's why the better long-term solution is something more akin to a state constitutional amendment addressing residential property tax increases. That will make the "fix" much more permanent.

In the interim, however, the special session is a good idea. As things stand now, local tax collectors are enjoying a double windfall -- first the increased proceeds from population growth, and then a second windfall from skyrocketing home prices.

Like children in the candy store, the bureaucrats cannot be trusted with this loot, because they will not save any for a rainy day.

They don't need the extra money -- the cost of mowing the grass and paving the streets and hiring lifeguards at the pools is not going up by double-digit leaps and bounds, just because home prices are. But they will spend it all, anyway, make no mistake -- and then wail and moan when the inevitable caps are imposed by the Legislature next year, calling them "vicious cuts aimed at the sick, the aged, and the children."

Anything that keeps this extra and undeserved income out of the hands of the bureaucrats is a worthy endeavor -- and the cost of a two-day special session at $100,000 or even $150,000 is chickenfeed in comparison.

We just hope Sen. O'Connell and her colleagues will seriously reconsider whether we really need to allow annual increases as high as 6 percent.

Especially when local officials will use that income to grant each other raises of 6 percent or more -- much more.

After all, how many taxpayers enjoyed a 6 percent raise this year?