Voters could decide taxes

CARSON CITY -- Assembly Transportation Chairman Kelvin Atkinson said Tuesday he is ready to seek legislative approval to ask voters whether they want to approve tax increases to finance road construction.

"That probably is the best way to go since the governor won't allow us to raise taxes," the North Las Vegas Democrat said on a day when Gov. Jim Gibbons' plan to raise revenue to pay for road construction finally was introduced in the Senate.

But the governor's Senate Bill 574 is a dramatically pared down version of the proposal he announced on May 10 as the way to solve the state's highway funding shortfall -- now estimated at $5 billion -- without raising taxes.

Gibbons' initial proposal would have taken $474 million in room taxes from the Las Vegas Convention and Visitors Authority over the next eight years and used the money for road construction.

In addition, Gibbons first proposed to take $148 million in sales taxes from vehicle sales and $212 million in live entertainment taxes now sent to the state general fund. That proposal was strongly opposed by Assembly Democrats because it would affect education.

Gibbons' new plan, however, would take no money out of the state general fund.

It would take a minimum of $20 million a year in Convention Authority room taxes. It also would take 30 percent of any additional tax revenue received by the convention authority. But the total would be less than $200 million over the next eight years.

"You can't bond off that," Atkinson said, explaining that it wouldn't be enough money to float a road bond.

Gibbons' plan also carries a proviso that no money would be taken from the convention authority if it impairs any existing bonds or financial arrangements.

Atkinson predicted that droves of gaming and convention authority lobbyists and officials will show up today at a joint hearing of the Senate Transportation and Taxation committees to protest the latest Gibbons plan.

John Swendseid, the convention authority's bond counsel, said the new plan still would take at least $20 million a year in room taxes. That would impair the convention authority's financial arrangements with its bondholders and be unconstitutional, he said.

He said the convention authority has existing bonds and financial arrangements that will not be paid off until 2026.

"If they don't take any money until all outstanding bonds are paid off, that would be fine and not violate the constitution," Swendseid said. "But they couldn't take money for highways until 2026."

Because the Gibbons plan and Senate proposals to raise taxes for roads are so tenuous, Atkinson said, he will start Thursday preparing a ballot question in which voters could tax themselves to pay for roads.

He said no decision has been made on which series of taxes voters could be asked to support, but he believes one should be the 15-cent per mile weight-distance tax on trucks.

That proposal, introduced earlier this session in Assembly Bill 595, would bring in about $150 million a year.

Atkinson said legislators also should look at three or four non-tax revenue sources that can be dedicated to roads. And he said they should pick the two or three most important highway projects that they want constructed first.

The Blue Ribbon Task Force on Transportation appointed by Gov. Kenny Guinn had recommended raising $3.8 billion in taxes to construct 10 super highway projects between 2008 and 2015. Because of inflation, the cost today has been estimated at $5 billion.

By raising about $170 million a year in taxes, legislators could float a 30-year bond to pay for $3.8 billion in highway construction.

Sen. John Lee, D-North Las Vegas, said he and Senate Transportation Chairman Dennis Nolan, R-Las Vegas, still have not introduced their own $2 billion highway funding plan.

Their proposal includes a 4-cent per gallon diesel fuel tax increase and increases in the amount of money motorists pay for registering their cars. Both proposals likely would be vetoed by Gibbons who has repeatedly expressed opposition to any new taxes.

Gibbons said in an interview earlier this session, however, that he would not oppose allowing voters to decide whether to tax themselves to fund road construction.

Lee said he expects their highway funding plan will be discussed during today's meeting.

"We have a great bill," said Lee, who admitted he has no authority under legislative rules to introduce it.

The deadline on new bill introductions ran out weeks ago. Now only emergency measures sought by legislative leaders can be introduced.

Gibbons' bill was introduced in the Senate because Assembly Minority Leader Garn Mabey, R-Las Vegas, gave his right to introduce one last emergency bill to Sen. Bob Beers, R-Las Vegas.

Mabey said he gave the bill to the senator so it could be introduced and discussions could begin on funding highway construction.