News - February 7, 2017 - by Ray Hagar

By Ray Hagar
Nevada Newsmakers

A coalition of local governments is reportedly preparing to persuade the Nevada Legislature into giving them some relief on a decade-old property-tax cap law.

Sparks Mayor Geno Martini, for example, addressed the issue in his state of the city speech last year, asking the Legislature to revisit the property-tax cap, which some see as stifling local government from producing revenue.

In 2005, when the housing market was booming, fears arose that the skyrocketing home values would lead to unaffordable property taxes for homeowners and businesses. The people in homes at Incline Village were the poster children for the crisis.

The Legislature then capped the growth in residential property taxes at 3 percent and businesses at 8 percent.

Now, those caps are a reason why property taxes -- a large and stable tax source -- are not recovering along with the rest of the economy, local government leaders and tax experts have said.

"I don’t think we will be able to recover on property taxes until the Legislature decides they want to do something with the tax cap," Martini said in his speech.

One lawmaker who is opposed to the tax relief for local governments is state Sen Ben Kieckhefer, R-Reno.

"I represent Incline Village, the home of the property tax revolt," he said on Nevada Newsmakers.

"A decade or so ago, the property tax caps that have been put in place were voted on for the sole purpose of protecting home owners who get taxed out of their property," Kieckhefer said. "I have a lot of constituents who are at-risk of that if we see significant increases in property taxes because of the growth in the value of their property that they have experience due to economic conditions.

"So I won't be supporting anything that increases the property tax on my constituents," Kieckhefer said.

Kieckhefer did not have much sympathy for the local government in this case.

"We talk about all the damage that has been done to local governments because of the property tax caps," he said. "It also means that $1.9 billion has been kept in the pockets of the actual citizens of Nevada. That is a good thing, not a bad thing."

This session is "probably not the best time" for local governments to seek help from the Legislature on the property-tax cap issue, Kieckhefer said.

"In the 2011 session -- and at least and I know in the 2013 session -- my colleagues and I sponsored legislation to make some changes in how processes like collective bargaining are done at the local government level that would have saved those local governments money over the long term. And they were nowhere to be found to support those bills," Kieckhefer said.

"So they haven't shown a lot of interest in actually becoming more efficient in how they spend their money," Kieckhefer added. "So coming back to the Legislature and asking for more right now is probably not the best time."