State high court removes arena petition from November ballot

CARSON CITY - Reversing its June 19 decision, the Nevada Supreme Court on Wednesday threw off the November ballot a proposal to levy a 0.9 percent sales tax increase to raise funds to build a $500 million arena near the Imperial Palace.

In the order, justices said the 200-word description on the Arena Initiative Committee's petition did not tell signers that, if approved, the arena could only be constructed on property owned by Caesars Entertainment, not on one of three other sites where proposals to construct arenas have been made.

The description is what voters read before deciding to sign a petition. The petition was signed in 2010 by 97,000 residents, qualifying it for the ballot.

Other casinos opposed the petition and appealed through state district courts and to the Supreme Court.

"Because it fails to reveal the ramifications to the competing arena proposals and fails to inform voters of the precise location of the proposed arena, we conclude that the initiative's description of effect is deceptive and materially misleading," the high court ruled.

Under state law, if a court finds a petition's description must be changed, even by just one word, then the petition and all signatures are invalid and circulators must begin collecting signatures again. But in its order six weeks ago, the high court only sent the matter back to District Judge James T. Russell and asked him to make changes to the description.

That led to requests by Taxpayers for the Protection of Nevada Jobs, a group that includes casinos opposed to the Caesars arena plan, to request a new hearing. Justices, realizing state law prevented a changed petition from going on the ballot, then reviewed their decision and issued a new opinion Wednesday.

In a separate opinion, justices also ruled that because the Arena Initiative was invalid, a competing question from the Legislature and Gov. Brian Sandoval also will not appear on the November ballot. During hearings last year, 60 of the 63 legislators and the governor registered strong opposition to the tax increase plan and put before voters a proposal to outlaw different tax rates in parts of counties.

Under the Arena Initiative, the higher sales tax would have been charged only within a three-mile radius of the proposed arena site. The tax rate, with statewide voter approval, would have been 9 percent in that area, while the rest of Clark County would have the current 8.1 percent rate.

Scott Scherer, a lawyer for Taxpayers for the Protection of Nevada Jobs, said his clients clearly were pleased with the decision.

"The key finding was the description of effect was misleading. The law is clear. It has to be invalidated."

Contact Capital Bureau Chief Ed Vogel at evogel@reviewjournal.com or 775-687-3900.