State tax distribution formula clears Assembly

CARSON CITY — Without any opposition Thursday, the Assembly quickly approved a bill designed to provide a fairer distribution of state taxes to local governments.

Even with the tax distribution formula changes in Assembly Bill 68, North Las Vegas will not get anything close to the $25.8 million in additional annual revenue it sought.

The bill changes how consolidated or “C” taxes are distributed to counties and local government. C taxes are portions of cigarette, liquor and sales taxes that the state returns to local governments.

North Las Vegas Mayor Shari Buck had complained to the Assembly Tax Committee in a recent hearing that the formula has shortchanged her city since 1981.

Her comments angered Assembly Speaker Marilyn Kirkpatrick, D-North Las Vegas, who said she has “freakin’u2009” been telling people the distribution formula is not based only on population, but also on the total assessed value of communities and the consumer price index.

North Las Vegas’ property values have been dropping dramatically during the recession. Kirkpatrick said recently the new formula will bring the city, the third most populous in the state, about $3 million more a year.

North Las Vegas now receives $168 per person from the C taxes, compared with $376 per person in the city of Las Vegas, $547 in Boulder City, $437 in Mesquite and $291 in Henderson.

The biggest change in AB68 is that it requires the state to consider the average consumer price index over five years, not one, in making its tax distributions.

Several Assembly Republicans praised Kirkpatrick for her work chairing an interim committee that designed the new formula.

“We worked as an interim committee in a bipartisan fashion to ensure the best policy for the entire state,” Kirkpatrick said in response to the praise. “We took politics out.”

Since members of the Senate Revenue Committee found few problems with the bill in a joint hearing with the Assembly Taxation Committee, the C tax bill is expected to soon receive state Senate approval, too.

Kirkpatrick had wanted quick passage so local governments could compute the revenue in the budgets they soon must submit to the Taxation Department.

Contact Capital Bureau Chief Ed Vogel at evogel@reviewjournal.com or 775-687-3901.