Cut Gibbons slack on deal

There seems to be a lot of press regarding the agricultural exemption granted Gov. Jim Gibbons for his property in Elko County. A quick look at the law may be helpful:

"NRS 361A.160 Determination of county assessor final unless appealed. The determination of use and agricultural use assessment in each year are final unless appealed in the manner provided in chapter 361 of NRS for complaints of overvaluation, excessive valuation or undervaluation."

I am giving my opinion here, as an individual, even though I am a member of the state Board of Equalization, appointed by Gov. Guinn. I am not a Republican; rather I am registered as an independent. My occupation is as an accounting (tax) associate professor at the University of Nevada, Reno. I am also on the record as not agreeing with some of the administration's current policies and positions.

However, there is a more important concept here. That is, taxpayers generally need to be able to rely on the determinations made by assessors. This is particularly important to taxpayers who rely on agricultural exemptions to reduce their property taxes and help their agricultural operations stay financially viable.

In this case, if the assessor did not believe the governor was entitled to the exemption, he should have ruled against an exemption and the governor could have appealed. If the assessor felt he had made a mistake, he also could have appealed after his initial determination. That is the established process for dealing with these issues. Since neither the governor nor the assessor appealed, the determination became final for this tax year. Read the statute above; it is pretty clear.

Agricultural exemptions are granted on a yearly basis and can be reviewed each year for eligibility. The assessor can review the exemption and its validity again for the next tax year. In my opinion, even our beleaguered governor is entitled to the benefit of this rather clear law.

Now, as to the appropriateness of the governor applying for the exemption, that is a different question and one upon which I cannot really comment. It is a personal decision each landowner must make. Also, whether the grazing lease arrangement is an arm's length economic transaction cannot readily be determined. But these are the facts the assessor, in the first instance or the appropriate appeals venues, would have to establish if the assessor did not grant the exemption.

However, on its face it seems the governor met the burden of proving he received more than the minimum $5,000 of income from his land so there was a basis for the exemption and, most importantly, the assessor chose to grant the exemption. I have dealt with many of the assessors throughout our state and they are not an easily intimidated bunch. They have a very hard job to do as elected officials, and in my opinion are generally doing it very well for the citizens of their counties.

As to John Marvel's involvement: Those who serve on state boards such as the Tax Commission or the Board of Equalization are filling part-time volunteer type positions. Although there is some pay -- I get $80 per day of service -- it is not nearly at market rates and continuing one's primary occupation is not only expected, but it is how Nevada gets qualified citizens to sit on these boards. These boards are a lot of work. Serving is essentially a public service. Mr. Marvel seems to have been doing what he should have been doing, representing a client.

Yes, the client here was the governor, but many well-heeled Nevadans hire attorneys to help with tax issues. Since this is what Mr. Marvel does for a living, it is normal for him to continue to do so. The fact that he sits on the Tax Commission does not make him inherently conflicted in all property or other tax matters. If he became conflicted on a particular issue, I am confident he would disclose any conflict and recuse himself from voting on that issue.

Bottom line, for the current tax year it seems to me the governor is entitled to the exemption under the law, simply because the assessor chose to grant it. The assessor was not compelled to do so and could have even appealed his own decision if he felt later it was wrong. In none of the press I have seen did the assessor allege he or his county were threatened by the governor or his representative in any way. Our county assessors deal with many wealthy, famous and powerful individuals on a regular basis and from my years of experience appear to treat them like everyone else when it comes to property taxes.

So as to the assessor feeling pressured, I will leave you with a quote from Eleanor Roosevelt: "No one can make you feel inferior without your consent."

The writer is an associate professor of accounting at the University of Nevada, Reno and member of the state Board of Equalization.