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Apr. 09, 2005
Copyright © Las Vegas Review-Journal


Two major state Senate committees delay action on proposed legislation involving taxes

By JOHN G. EDWARDS
REVIEW-JOURNAL


The Senate Commerce and Labor Committee and Senate Taxation Committee are delaying tax-legislation action so legislators can determine the financial effect of the collective measures before votes, committee chairman and state Sen. Randolph Townsend said Friday.

Earlier Friday, he debated a bill to eliminate franchise taxes with local-government lobbyists. Franchise taxes are collected from electric utilities, natural gas utilities, land-line telephone companies, wireless phone systems and cable television systems for use of public rights of way.

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However, these businesses pass the tax along to their customers, resulting in a "hidden" tax on consumers, Townsend said. He advocates passage of Senate Bill 277, which would abolish the taxes.

Local governments in Nevada collected $144 million last year. Clark County collected $42 million; Henderson, $21 million, Las Vegas $42 million and North Las Vegas $10 million last year.

The typical family of four pays $230 yearly in franchise taxes, he said.

"What do (citizens) get in return? The answer is nothing," Townsend said.

In essence, citizens are paying rent for property they own through the government, he said. "The renting of the right of way of the people to the people is the most bizarre thing this committee has ever seen," Townsend said.

Nicholas Miller, a representative of the Nevada League of Cities, said franchise taxes are much like rents that an office building landlord charges.

"This has become an important revenue source for local governments around the state especially the two larger counties," said Marvin Leavitt, an Urban Consortium lobbyist .

Nevada enacted the franchise tax on utilities in 1909, but the state allowed local governments to also start granting franchises to cable television stations in 1985.




9/11
2005 Nevada Legislature

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