State plan to raid county coffers frustrates some

The state Senate's approval of a bill to take roughly $125 million from Clark County has left some local leaders frustrated, perplexed and worried.

In the next two years, about $60 million would come from the county's general fund, which is used to pay for services, and about $40 million would get pulled from transportation funds, all paid for with property taxes.

The county is also chipping in $25 million from the dissolved redevelopment program.

County commissioners last week passed the 2009-10 budget that plugged a $113 million shortfall through a mixture of cutting costs and dipping into a reserve fund. The county must now fill a new budget hole created by the grab, with more holes expected to form as the state reduces funding to county programs.

On the plus side, lawmakers agreed to give the county $16 million from motor vehicle fees to help offset the takeaway. The amended bill also lets the county use $7 million yearly from a transportation program to cover operating costs and lessen the blow to services.

Because of those two added provisions to Assembly Bill 543, Gov. Jim Gibbons probably will veto the bill, said Assemblywoman Sheila Leslie, D-Reno, adding that lawmakers will have time to override the veto.

County Commissioner Rory Reid said he was disappointed that the state was moving ahead to raid the county's strained coffers.

"A decision to divert money is not a long-term solution, and it's going to make it more difficult for us to provide services to our people," especially the sick, poor and elderly, Reid said.

The state is in a tough bind, but that doesn't justify taking money from local entities, Reid said. "We balanced our budget doing the difficult things in our house, and we didn't ask anybody to do it for us."

County Commissioner Steve Sisolak said he's puzzled as to why the state is grabbing only from Clark and Washoe counties.

"It is not fair to the taxpayers of Clark County that we're subsidizing all counties," Sisolak said.

The cities should share the burden, rather than having it fall mainly on those in unincorporated areas, Sisolak said.

Officials in Las Vegas and North Las Vegas declined to comment. But a Henderson lobbyist said property owners in the cities pay taxes into the county's general fund.

The state is taking tax money collected countywide, so it wouldn't be fair to hit the cities again, said Marvin Leavitt, who represents Henderson in the Legislature. "City residents would be paying double."

Don Burnette, the county's chief administrative officer, half-agreed.

City residents pay taxes to help support regional services such as child welfare and courts, but these services can't absorb all or even most of the funding loss, Burnette said. Much of the impact will be on departments that serve only the unincorporated areas, he added.

In an e-mail, Leslie said the governor's office proposed taking money from the two biggest counties and didn't explain why the cities should be spared. She insists she was against taking money from the counties.

"After the Economic Forum's report on May 1, it became increasingly obvious that we would have to take it out of desperation because there was no other way to balance the budget," Leslie said. "In retrospect, I think it would have been more fair to spread the pain across the cities as well, but that idea never seemed to catch on."

Under the bill, the Regional Transportation Commission will lose $32 million for road work, compounding the $19 million dip in revenue from sales and fuel taxes in the past year, according to the agency's figures.

RTC will study in the next month which highway projects to postpone for two years and which ones to slash, said Tracy Bower, agency spokeswoman.

County Commissioner Larry Brown, who also chairs the transportation commission, said transportation should not be sacrificed completely to save services.

If major projects are put off for two or more years, the cost of construction will escalate, Brown said. Right now, contractors are bidding the lowest in a decade, he said.

"It's a balancing act," Brown said.

County Manager Virginia Valentine said the tax grab is just one of many financial hits the county is taking by the Legislature. Unfunded mandates and reduced funding in child welfare and hospital programs are expected to materialize soon, she said.

"We won't know all the impacts until the end of the session," Valentine said.

"We have to look at all those things in total, and then we've got to look at where we're going to adjust and where we're going to absorb those impacts."

Contact reporter Scott Wyland at swyland@reviewjournal.com or 702-455-4519.