County: Health district ruling will force tax increase, cuts in services

CARSON CITY - Clark County either must raise taxes or reduce services on such things as police and hospital care because a state Supreme Court decision forces it to pay a minimum of $18 million more to the Southern Nevada Health District.

So says county spokesman Erik Pappa after the high court's 6-1 ruling Thursday that the County Commission illegally underfunded the health district last year.

Pappa said the county has no money in its budget to make the payment and must cut services or raise taxes. The decision also will require the County Commission to properly fund the health district's current and future budgets.

The decision comes at an inconvenient time for county government, which has cut one in five positions and $230 million from its budget in the past four years. It also has been asked to pony up more for the Metropolitan Police Department budget, an obligation that it shares with the city of Las Vegas, and the county's University Medical Center, which continues to lose money.

County Commissioner Steve Sisolak said he is against raising taxes, so services probably will be cut.

He was critical of the health district, which he said has been giving its employees pay increases while the county has been making cuts and eliminating positions.

"It could cause the curtailing or elimination of other services so other people can get raises," Sisolak said. "It just illustrates how, unfortunately, the government and some of this legislation is out of touch with the real world and the problems of everyday people."

But health district spokeswoman Jennifer Sizemore said the comment about her agency raising salaries at the expense of others is "from years ago."

"We have negotiated a new contract on par with other jurisdictions," she said.

Sizemore said public health services in Southern Nevada are "wholly underfunded" and the additional money will benefit all citizens.

She noted that the county has a low immunization rate and a high teen pregnancy rate that could be addressed by the money.

The district program manager and chief health office will analyze needs and decide where the new money should be spent, she said.

Based on how much the county underfunded the district, a property tax increase of about $25 a year on a home assessed at $100,000 would be needed to cover the shortfall in funding.

Justices ruled Thursday that a state law adopted in 2005 requires the County Commission to adopt the health district's budget "without modification" if the amount requested does not exceed
3.5 cents per $100 of assessed value of the county's property tax revenue.

The health district sued the commission over underfunding its budget last year and failing to provide $15.9 million to replace its headquarters on Shadow Lane.

The district argued that it should have received $22.5 million from the county last year under the state law on property taxes but instead got $5.69 million.

A lower court judge ruled in the health district's favor. The commission then appealed to the Supreme Court.

Noting that the law on allocated revenue to the health district was ambiguous, justices said that during legislative hearings the intent of the enabling bill was to provide a stable funding source for the health district.

In particular, they quoted Dan Musgrove, then the director of intergovernmental relations for the county manager.

Musgrove told the Assembly Committee on Health and Human Services that the bill would give the health district "a designated funding source."

He mentioned that the district "really had no way of knowing whether the County Commission was going to provide them the funding from year to year."

Assemblywoman Sheila Leslie, D-Reno, added that "before this proposed bill, they (the health district) had to come in and ask the County Commission every year; depending on how the commissioners feel about the department, their budget might go up or down."

Justices ruled the testimony showed the Legislature wanted the health district to have a revenue stream "free from county interference."

Justice Kris Pickering voted against Thursday's high court decision. She said the law in question does not say the health district must receive at least 3.5 cents per $100 of assessed value in property taxes, but "an amount that does not exceed" the sum of money. That could mean "something different from at least 3.5 cents," she said.

She also argued the justices should not rely on testimony on the bill to override the text of the passed law.

Las Vegas Review-Journal writer Kristi Jourdan contributed to this report.