MINUTES OF THE
SENATE COMMITTEE ON TAXATION
Sixty-seventh Session
January 21, 1993
The Senate Committee on Taxation was called to order by Chairman Dean A. Rhoads, at 2:05 p.m., on January 21, 1993, in Room 224 of the Legislative Building, Carson City, Nevada. Exhibit A is the Meeting Agenda. Exhibit B is the Attendance Roster.
COMMITTEE MEMBERS PRESENT:
Senator Dean A. Rhoads, Chairman
Senator Ann O'Connell, Vice Chairman
Senator Randolph J. Townsend
Senator Sue Lowden
Senator Bob Coffin
Senator Raymond C. Shaffer
Senator Ernest E. Adler
STAFF MEMBERS PRESENT:
Kevin Welsh, Deputy Fiscal Analyst
Billie Brinkman, Committee Secretary
OTHERS PRESENT:
Janice Wright, Deputy Executive Director, Department of Taxation
Dave Purcell, Chief of the Division of Assessment Standards, Department of Taxation
Senator Rhoads read a letter from the Nevada Taxpayers Association requesting a committee introduction for a bill draft, and the attached explanation of the proposed bill draft (Exhibit C). Discussion followed on the referenced Governor's veto of Senate Bill 295 of the Sixty-sixth Session.
S. B. 295: Requires registration of pharmacy technicians with
state board of pharmacy and requires board to
adopt regulations concerning pharmacy technicians.
Senator O'Connell explained the Governor vetoed S.B. 295 of the Sixty-sixth Session because he felt the language did not "address the concern." She said it was a matter of inequity.
SENATOR COFFIN MOVED FOR COMMITTEE INTRODUCTION.
SENATOR O'CONNELL SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
[For further mention of this Committee action, please refer to the minutes of the meeting, January 26, 1993, of the Senate Committee on Taxation.]
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Chairman Rhoads called attention to a volume entitled, State of Nevada, Study of the Slot Machine Route Operator Industry 1992,(Exhibit D. Original is on file in the Research Library).
Chairman Rhoads introduced Kevin Welsh, staff member, who explained the first agenda item: "Legislature's role in local government finance."
Mr. Welsh addressed the fact that members of the Senate Committee on Taxation would have a great deal of influence in local government finance, and outlined the topics local governments could be requesting the committee to address. Included were: 1) The statutory cap; 2) Supplemental City/County Relief Tax (SCCRT), also known as the Fair Share Bill; 3) tax distribution; 4) assessment standards and practices; and 5) the maximum allowable combined revenue.
Janice A. Wright, Deputy Executive Director, Nevada Department of Taxation, came forward to address Agenda Item No. 2: "Redbook and Other Department of Taxation Publications." She gave an overview of the responsibilities of the taxation department and the administering of taxes the department has been charged with by the legislature. She requested some time be allotted by the committee for the Tax Commission so that some of the concerns may be discussed which face the Tax Commission. Thursday, February 4, 1993, was the suggested date for a joint meeting with the Assembly Committee on Taxation.
Ms. Wright explained the Property Tax Rate Components Fiscal Year 1992-93 (Exhibit E).
Ms. Wright called attention to the publication, 1992-1993 Ad Valorem Tax Rates For Nevada Local Governments, (Exhibit F. Original is on file in the Research Library.) She gave a cursory review of the "Redbook", which outlines individual tax rates in detail. She answered committee member's questions throughout the presentation.
Ms. Wright provided copies of the State of Nevada Department of Taxation Annual Report, Fiscal 1990-1991 (Exhibit G. Original is on file in the Research Library.) She said the current year's report would be available for distribution at a later date as the State Printing Office is running behind schedule.
She pointed out that sales tax receipts for November demonstrated a 7.28 percent increase. Ms. Wright said so far in 1992, there have been seven consecutive months which have shown an increase. She pointed out however, there has not been an increase in all the major components. Certain portions of the categories tested by the Tax Commission have not shown increases, therefore the commission is being relatively cautious in not only restricting the amounts provided to the local governments for projected budget purposes, but also for the Commissions internal uses.
In explaining the various taxes the commission is responsible for administering, Ms. Wright used the sales tax as an example. She said if a 7 percent tax is collected, it is distributed as follows: 2 percent to state general fund; 2.25 percent to local school support tax, an increase of .75 percent over last year; one-half of one percent is called Basic City/County Relief Tax and is distributed to counties and cities; 1.75 percent is Supplemental City/County Relief Tax, the Fair Share issue discussed during the Sixty-sixth Session. She added counties have the option of imposing a .25 percent tax for one of three purposes: 1) regional transportation, 2) roads, or 3) tourism.
Ms. Wright continued with the overview of Exhibit G..
Senator O'Connell asked for an outline of the areas in which sales taxes show a decline. Ms. Wright complied, saying some of the areas where sales are down include specialty stores, candy and tobacco stores, household and home furnishing stores, appliance stores, printers/publishers and paper products. Vending machine operators, fuel and ice dealers, mining and assay offices, new and used auto dealers, trailer/aircraft/motorcycle and boat dealers, itinerant vendors, mobile home dealers, construction and specialty trade contractors, manufactures and wholesalers, producers and distributors, and all other outlets. The overall grand total, statewide, by business category averages a decline of .53 percent. She pointed out the largest dollar contributors are eating and drinking businesses which were up 3.12 percent. This category generates $2.7 billion. She related the largest decrease was itinerant vendors, which was down 17.8 percent. She pointed out this category accounts for only $11 million. Ms. Wright indicated it is necessary to compare the size of the business in order to get a true picture.
Senator O'Connell asked Ms. Wright what her personal overall feeling was in reference to what is happening to the economy at this time. Ms. Wright replied the commission observes that people are less reluctant to spend money now than during the same period last year. She pointed out, however, that a decline in major projects in Clark County affected the economy. She said when the large projects, such as casino hotels, are not coming "off the board" one right after another, then a decline is apparent in the kinds of trades associated with those big projects, such as home furnishings, carpeting, appliances---the big ticket items used for furnishing a hotel. The rest of the population of Nevada cannot keep up enough of a volume to sustain the economy without the large projects. For that reason, the commission remains relatively conservative and that conservatism is associated with the projections for the local government budgets.
Senator O'Connell asked about the ADA (American Disabilities Act) and the mandates which may be received from the federal government. She also inquired what effect the endangered species mandates may have on Nevada.
Ms. Wright replied that the Budget Office of the Department of Administration will do a more thorough report on the mandates and the proposed funding. She said she is not well enough versed to speak on the impacts some of the mandates will have on the local governments. She said it is difficult to inform a local government they have to affect a program, yet not show them how they can fund it.
Ms. Wright introduced Dave Purcell, Chief of the Division of Assessment Standards, Department of Taxation, who gave a summary of publications (Exhibit H) available from the Department.
The meeting of the Senate Committee on Taxation was adjourned at 3:15 p.m.
RESPECTFULLY SUBMITTED:
Billie Brinkman
Committee Secretary
APPROVED BY:
Senator Dean A. Rhoads, Chairman
DATE:
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Senate Committee on Taxation
January 21, 1993
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