City Council asks Henderson staff to study property tax recommendations

The Henderson City Council wants to find out during the next few months whether citizens and business owners of the city are willing to pay more in property taxes to maintain itself as a “premier city.”

That was part of the mission given to city staff after the Special Budget Ad Hoc Committee presented its report Tuesday night. Part of the report recommended increasing some city fees and reducing some services. But the part of the report that received the most attention was a recommendation to raise property taxes 20 cents per $100 of assessed valuation to help bridge a $19 million annual budget deficit and address infrastructure needs.

Councilwoman Gerri Schroder said the council probably will receive criticism during the process, but that is part of the job.

“This is a tough decision that we’re going to have to make,” Schroder said. “If we want to continue to live in a premier community, then what is it the residents want to see? Or what can they maybe do without.”

The council directed staff Tuesday to review the report’s findings and return in a few months with their own recommendations based on the report to the council.

Mayor Andy Hafen asked City Manager Jacob Snow and city staff to put together a presentation that can be taken out to the community so residents and business owners understand the financial challenges facing the city.

“There’s a lot to digest here,” Hafen said. “I will go to any homeowners’ associations, any chamber event, business groups; anywhere and everywhere I can to make these presentations.”

The City Council heard the report’s suggestions from committee chairman and downtown businessman Tim Brooks, and committee facilitator Thom Reilly, a former Clark County manager. The 21-member committee met nine times between September and December, receiving presentations from the city manager and various departments.

Revenue from the property tax increase would generate up to $16.5 million per year, helping the city address its $2 million annual operating shortfall and $17 million annual infrastructure needs.

The city has maintained a property tax rate of 71 cents per $100 of assessed valuation since 1991, considerably lower than Las Vegas, at $1.06 per $100 of assessed valuation, and North Las Vegas, at $1.16 per 100 of assessed valuation. The city could only approve a 3-cent increase without a vote of the citizens.

In 2005, the state approved a property tax cap with annual increase limits of 3 percent for residential and 8 percent for commercial properties. The idea of the law nine years ago was to prevent homeowners from being priced out of their residences by rapidly increasing property taxes.

Property tax, which accounts for 26 percent of the city’s general fund revenues, is estimated at $58.5 million this year, down from $85.7 million in 2008, according to the committee’s report. The general fund budget for fiscal 2014 is $219.1 million, with more than half dedicated to public safety.

Snow said the need for additional revenue is “an issue of crumbling infrastructure.”

The strain on the general fund comes as the city experiences declines in other revenue streams including the gas tax, sales and use tax and land sales. Various departments and services have had to defer maintenance that has led to a backlog of needs. According to Public Works Director Bob Murnane in the committee report, the city must invest $69.4 million during the next 10 years to maintain its 822 miles of pavement, and another $80.4 million over 10 years for upkeep of the city’s 1.8 million square feet of building and facilities space.

The city’s staff has been reduced by 230 positions during the downturn, and nonunion compensation has declined 6 percent to 11 percent since 2008, according to the city. Cost-of-living adjustments have been frozen since 2010, and all employees agreed to concessions equaling 2 percent of pay for the past two fiscal years. The city also has deferred capital construction and maintenance projects during the downturn.

However, only one-fourth of property taxes from Henderson residents and businesses go to the city’s general fund. The rest is collected by the state, Clark County, the Clark County School District and other special districts.

Hafen asked that residents and business owners in Henderson take time to read the committee’s recommendations, which is available on the city’s website.

“I hope after they review it and become educated on the issues facing our city in the future that they too will come to the same conclusions and recommendations this committee did,” Hafen said.


City Council also approved a $513,000 construction contract for the officer locker rooms and exercise area renovation at the Emergency Services Facility in downtown Henderson.

Mountain Vista Development was awarded the contract to renovate the facility, which opened in 1992 on the second floor.

Project scope includes renovating the showers, installation of new metal lockers with power outlets, new flooring and sinks and counters, upgrades to air ventilation system and other features. The exercise room will be fitted with some new equipment, new flooring and room fans, as well as moving the crossfit area from the city parking garage to the facility. The project is being funded through a transfer from the Detention Center Expansion project and the Land Fund.

Contact reporter Arnold M. Knightly at or 702-477-3882. Follow him on Twitter @KnightlyGrind.

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