Opposition swamps plan to siphon water taxes

CARSON CITY -- A proposal by a Clark County legislator to siphon more than $400 million in sales taxes from the Southern Nevada Water Authority ran into an avalanche of opposition Tuesday, including from his fellow lawmakers.

Assemblyman Joe Hogan, D-Las Vegas, said that Nevada faces unprecedented financial needs and that the money offers the state government a way to cover health care costs, education needs, and employee salaries and benefits.

But water authority officials told the Assembly Taxation Committee that the revenue, from a quarter-cent sales tax levied in Clark County since 1999, goes to develop water resources and construct wastewater facilities.

If the state grabs the money, water authority lobbyist Andy Belanger said, then one project that will not be built on time is the third straw to bring water from Lake Mead into households in the Las Vegas Valley.

"We have to have a steady water supply, and the third intake is the most critical piece," he said.

And the need for the project only grows more urgent as the lake's water level continues to fall, AFL-CIO Secretary-Treasurer Danny Thompson said.

He said the water authority is 50 feet "away from losing its ability to take water out of the lake" through existing intake lines.

About 90 percent of the valley's drinking water comes from Lake Mead by way of the two existing intakes.

Construction is under way on the third intake, which will reach deep into the lake and allow the authority to continue drawing water after the other two intakes must shut down.

The latest cost estimate is $817 million. The largest share of that money is expected to come from sales tax revenue and connection charges collected by the authority as new homes and businesses hook up to the valley's water system.

Although she took no vote on Hogan's Assembly Bill 321, Taxation Chairwoman Kathy McClain, D-Las Vegas, said she did not like the policy of taking taxes from counties.

The quarter-cent tax for water and wastewater projects was approved by more than 70 percent of voters in Clark County in 1998.

Assemblyman Ed Goedhart, R-Amargosa Valley, said the bill goes against the will of people who wanted their tax dollars earmarked for such purposes.

Hogan proposes the state take the existing $400 million pot of sales taxes the water authority has accumulated and most of the $82 million a year the tax will produce until 2015. Then the water authority could start to reclaim its money.

"Enact it as a backup to protect the 70 percent of all Nevadans who live in Clark County and will suffer from a collapse of state services," he said.

But only Assemblyman Harry Mortenson, D-Las Vegas, expressed any sympathy for the bill.

"We are in such a desperate need of money for children, for education, for mental health," he said.

Review-Journal writer Henry Brean contributed to this report. Contact Capital Bureau Chief Ed Vogel at evogel@reviewjournal.com or 775-687-3901.