Three property tax proposals to come out of Legislature

Nevada's legislative leaders have agreed on three possible ways to provide immediate relief from skyrocketing property taxes. The plans will be presented in a joint hearing Tuesday.

Assembly Minority Leader Lynn Hettrick, R-Gardnerville, said constitutional amendments and other long-term proposals can be taken up later, but any relief from increases of 40 percent to 80 percent this year must be passed by the end of this month.

County assessors say if lawmakers take much longer than that, they won't be able to recalculate the tax rolls in time for this year's tax bills, which go out in July.

"What we have to do now is say to the counties we're going to do this so that they can go do their budgets," he said. "We have to craft something now."

Senate Minority Leader Dina Titus, D-Las Vegas, said the package includes three main proposals: a tax freeze, a tax cap and "a formula that's pretty complicated but staff says is (constitutionally) defensible."

Assembly Speaker Richard Perkins, D-Henderson, said the plans will be presented in a public joint session of the Senate and Assembly committees handling the issue on Tuesday.

"We weren't trying to get consensus on one bill," he said.

Perkins said the idea was to capture the main ideas lawmakers have come up with in three proposals instead of 21. He said that's how many requests for bills had been filed and that staff simply didn't have the time to draft them all.

"I think with all three proposals, there is another formula staff developed to get around the big constitutional problem with new property. Nevada's constitution says property taxes must be uniform and equal. But a cap would violate that test for newly developed property which was much less valuable before a new building was built on it by not allowing the value of those improvements to be fully added on."

The special formula effectively creates a hypothetical value for property which was developed this year, calculating what that value would have been if the construction occurred last year.

Titus said she requested the freeze bill and still supports it. It would freeze taxes this year and allow them to rise by the inflation index next year.

Perkins said the cap proposal can be adjusted to include whatever percentage lawmakers want to cap the growth of assessed valuation. Lawmakers have talked about proposals ranging from 2 percent to 9 percent.

The formula proposed by staff is, according to Titus, "still too complicated for me to explain." It would apply different calculations to determine what allowable tax increases would be in a given year and, according to staff, meet the constitutional test.

The three proposals give lawmakers a chance to examine what happens when different numbers are plugged in, the legislators said. That way, all members of the Legislature can discuss their ideas.

Legislative legal and fiscal experts, they said, will be on hand at Tuesday's hearing to explain the effect of the proposals.

They said every lawmaker will be allowed to present his or her own ideas, with staff prepared to help judge whether the idea is constitutional and, second, what effect it would have on state, local governments, schools and smaller entities like improvement districts.

Perkins said the immediate fix will be followed by an interim study to work out a permanent solution to the property tax problem that can be taken up by the 2007 Legislature. He and Hettrick said that is the time when such things as constitutional amendments can be taken up.

Assembly Majority Leader Barbara Buckley, D-Las Vegas, said a constitutional amendment giving lawmakers more flexibility to respond in the future should be started through the four-year amendment process.

Contact reporter Geoff Dornan at gdornan@nevadaappeal.com or at 687-8750.