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Higher fees proposed for Las Vegas businesses

Las Vegas is set to consider a package of business fee increases Wednesday, and while some of the proposals have been tempered, business interests are still concerned about raising the cost of doing business during an economic downturn.

“We appreciate city officials working with the business community,” said Cara Roberts, spokeswoman for the Las Vegas Chamber of Commerce. “However, now is really the wrong time to add additional burdens to an already struggling business community.”

The proposals were originally put forth in May and were scheduled to take effect July 1, but were moved back to hear concerns from the business community.

The two proposed ordinances cover a lot of ground. Filing and application fees would increase, as would penalties for noncompliance with city code. Also set to go up is the tax rate for many businesses that compute renewal fees based on gross sales.

Another change would adjust flat business fees to match changes in the Consumer Price Index because officials are worried that the cost of administrating the licenses is more than the revenue collected.

The city has been responsive to business owners’ concerns, said Andy Gruber, an executive with the Cashman Co. and Red Rock Harley-Davidson.

The gross sales tax rate, for example, wouldn’t increase as much as originally proposed. A section tying future fee increases to population growth has been removed, and the CPI indexing will use a five-year average to avoid anomalous spikes.

Still, “our main general opposition is having any increase at this time,” Gruber said, especially because the Nevada Legislature raised business levies earlier this year. “In addition to that, to have the city do it — it’s painful.”

Another contested element is a new requirement that would make landlords of commercial property get a business license, something that isn’t required now.

“It’s almost like a double tax,” said Kevin Higgins, senior vice president of Voit Commercial Brokerage and president of the Society of Industrial and Office Realtors, because property owners pay property taxes and tenants already must get a business license.

The change could lead to either higher commercial rents in the city or landlords losing money.

“At some point, there’s going to be pushback, and the pushback will be that people decide to rent somewhere other than the city of Las Vegas,” Higgins said. “You’re hurting what we see as the economic drivers.”

The city’s stance holds that a commercial lessor is transacting business with tenants, necessitating a license.

City officials originally estimated the changes would raise $1.4 million in additional revenue. With the revisions, that total was lowered to less than $1 million.

The measures were sponsored by former Councilman David Steinman, who served in an interim capacity until the Ward 4 seat was filled in the June 2 election.

Stavros Anthony won that election and is now occupying the seat. Through a city spokesman, Councilman Anthony said Monday that he will wait until after the presentation Wednesday to decide how to vote.

In an unusual development, the proposals come before the council without a recommendation.

In June, a two-person council subcommittee that considered them split on the subject, with Councilman Steve Ross recommending that the measures not be passed, and Steinman, in one of his last council votes, disagreeing.

Revised versions of the ordinance released Monday still listed Steinman as the sponsor.

“According to business licensing, it hasn’t complicated matters,” said city spokeswoman Diana Paul when asked if the lack of a sitting council sponsor made a difference.

It should, said Roberts of the Las Vegas Chamber.

“We question that the sponsoring person is no longer on the City Council,” she said. “If no one else is willing to put their names on these proposals, is it something that should be pursued at this time?”

Contact reporter Alan Choate at achoate@reviewjournal.com or 702-229-6435.

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