a service of the Nevada Policy Research Institute

Business G-2

Assessors seek higher cap
on property tax liabilities

Association crafted, submitted two bills last year

By Steven Miller

Nevada’s county assessors like to pose as advocates for taxpayers.

But for the last year, they’ve been drafting new legislation that would substantially increase the tax liabilities of every home or business property owner.

Two measures—Senate Bill 394 and Senate Bill 486—were introduced the last week of March into the 2005 Legislature. Because most eyes were on the property tax relief issue, the bills drew little attention. But they reflect bill-draft requests 32-258 and 32-259, submitted by the Nevada Assessors’ Association last July.

The state Senate’s Taxation committee—chaired by Mike McGinness, R-Central Nevada Senatorial District—introduced the bills on behalf of the assessors.

Both of the measures are written to remove one of the most important protections Nevada taxpayers have—NRS 361.228, which protects all manner of intangible personal property from taxation.

Subsection 1 of NRS 361.228 says “All intangible personal property is exempt from taxation,” then goes on to spell out the exact kinds of property it means.

Included, “without limitation,” are shares of stock, bonds, mortgages, notes, bank deposits, company goodwill, customer lists, patents, trademarks, custom computer programs, copyrights, trade secrets, franchises and licenses, etc.

Subsection 2 of NRS 361.228 goes on to say that the value of intangible personal property cannot be used by assessors to “enhance or be reflected in the value of real property or tangible personal property.”

It’s both of those subsections that the assessors are seeking to nullify with SB 394 and SB 486. If they succeed, they will be able calculate significantly higher taxable values for home and business properties and wring much more out of Nevada taxpayers.

That’s because the assessors will have circumvented more well known Nevada law that says that the “computed taxable value of any property must not exceed its full cash value.” In both SB 394 and SB 486, new provisions say, “To determine the full cash value of any property for the purposes of this requirement, the provisions of subsections 1 and 2 of NRS 361.228 do not apply.”

Thus, if the assessors get their way, when they officially proceed to determine the “full cash value of any property,” they’ll be able to count almost everything of value that property owners happen to own.

Members of the Nevada Assessors Association are all elected politicians. They include, in Carson City, Dave Dawley; in Churchill County, Norma Green; in Clark County, Mark W. Schofield; in Douglas County, Doug Sonnemann; in Elko County, Joe Aguirre; in Esmeralda County, Ruth Lee; in Eureka County, J. P. “Jim” Ithurralde; in Humboldt County, William (Jeff) Johnson; in Lander County, Lura Duvall; in Lincoln County, William Lloyd; in Lyon County, Mike Glass; in Mineral County, Gloria Hughes; in Nye County, Sandra Musselman; in Pershing County, Celeste Hamilton; in Storey County, Kathy Weeks; in Washoe County, Robert Mcgowan, and in White Pine County, Robert Bishop.