Legislators land a road deal

CARSON CITY -- Lawmakers and special interests found a way Thursday to wring $1 billion in pavement from tax coffers.

Legislative leaders reached an agreement with the Las Vegas Convention and Visitors Authority, rental car companies and local governments to take portions of three existing taxes to pay for $1 billion in highway construction.

Gov. Jim Gibbons attended an evening Assembly Transportation Committee hearing to endorse the agreement.

"The plan before you will enable critically important projects to go forward. It will not raise taxes on the people of our state. And it will accommodate and enhance our economic growth," said Gibbons, who noted that his staff had worked with legislators on the proposal.

Under the agreement, the following would occur:

• The convention authority will contribute $20 million a year in room tax revenue to the highway construction fund.

• Clark and Washoe county governments will reallocate to the highway construction fund some existing property tax revenue now spent on local capital improvement projects.

• Rental car companies will give the state one-quarter of the revenue they now generate from imposing a 4 percent tax on car rentals. The state has allowed the companies to collect and keep the tax to pay their car registration fees.

The tax revenues, estimated at $65 million a year, would be used to repay a $1 billion bond.

While the $1 billion falls short of filling the state's $5 billion gap in highway construction revenue, Assembly Transportation Committee Chairman Kelvin Atkinson, D-North Las Vegas, said it was a good start.

"We are going to have to do something at future sessions," he said.

"We are reallocating existing taxes," Atkinson said. "No one wants to raise taxes. People say Democrats want to raise taxes. We don't want to raise taxes more than anybody else. At the end of the day, everybody is happy we are keeping transportation moving forward."

Earlier this week, it appeared nothing would be done during the legislative session, which ends Monday, to deal with the highway construction shortfall.

Money raised from the reallocation of the three taxes would be used initially to widen Interstate 15 between Sahara Avenue and Tropicana Avenue to 10 lanes. That portion of the freeway now has six lanes.

Also, money would be spent to widen I-15 between Tropicana Avenue and state Route 160 to eight lanes. The road now is six lanes wide.

U.S. Highway 95 between Washington Avenue and Craig Road would gain additional lanes, too.

The agreement was inserted into Assembly Bill 595 and then passed unanimously.

Atkinson said he might push for another bill to ask voters on an election ballot question whether they want to raise taxes to pay for roads.

"At some point we have to involve other stakeholders," Atkinson said.

The entire Assembly probably will approve the bill today and send it to the Senate for an afternoon hearing before the Senate Transportation Committee.

Senate Transportation Committee Chairman Dennis Nolan, R-Las Vegas, said he would support the plan but called it a "shortsighted agreement."

Nolan predicted the Legislature in 2009 "will be right back at it," looking for new ways to find revenue to cover the highway construction shortfall.

Assemblyman Mark Manendo, D-Las Vegas, said, "It doesn't fix the problem; it just makes it so we don't fall further behind."

While most speakers Thursday evening praised the agreement, Las Vegas Mayor Oscar Goodman expressed disgust.

"I am very unhappy about this process," said Goodman, who is chairman of the convention authority board.

He said Gibbons never spoke to him about taking money from the convention authority for highway construction. The convention business is the "lifeline and blood of our economy," Goodman said.

But Atkinson, perhaps involved more than any legislator in crafting the agreement, cut Goodman's remarks short.

"I take exception this was done improperly," he said. "Some of us worked for months on this. This is what we settled on."

Goodman fired back that it was Atkinson who had asked him to speak and then sat down.

Rossi Ralenkotter, the convention authority's president, and lawyer John Swendseid testified that taking $20 million a year in room tax revenue will not affect the convention authority's current contracts, including a bond to renovate the convention center.

In five years, the number of hotel rooms in Las Vegas will increase from 132,000 to 170,000, Ralenkotter said.

"We recognize the impact on traffic. We need to move our visitors in and out of Las Vegas," he said.

The convention authority chief served on a task force that proposed the Legislature raise $3.8 billion to build 10 super-highway projects between 2008-15. Because of inflation, the cost of the projects has been estimated at $5 billion by Nevada Department of Transportation Director Susan Martinovich.

Clark County lobbyist Mike Alastuey and veteran lobbyists Myron Leavitt, who represents several Nevada cities, expressed reluctant support for using property tax revenue to build roads.

Alastuey said Clark County had planned to use that money for parks and recreation improvements.

But Leavitt said that reducing traffic congestion is sometimes a higher priority, calling it "a sad fact of life."