The director of the Nevada Taxpayers Association and Carson City Assessor Kit Weaver have joined school board member Bob Crowell in urging that Carson City schools get a share of any tax windfall from the proposed Costco deal.
City officials are considering selling a 15-acre parcel at Fuji Park to Costco for a giant warehouse store.
The vacant land, previously designated as a parking lot for Fuji Park, is being added to the city's redevelopment district so that officials can deal directly with the company. Otherwise, the land would go up for public bid.
Regardless of the outcome, it appears the Costco proposal and a similar use of redevelopment law to bring Target and Home Depot to Douglas County will spark some interest in the Nevada Legislature's next session.
Carole Vilardo, director of the taxpayers association, said it is a "creative" use of the law to add land at Fuji Park to the city's redevelopment district and then sell it as a site for Costco.
The property isn't on the tax rolls now, because it is city owned. That means the entire yearly property tax collected if Costco were built would go to the redevelopment district - including the 75 cents per $100 of assessed valuation that normally goes directly to the school district.
"It's very creative and I believe it's probably legal," said Vilardo. "But we do a lot of things that are legal which are questionable as to whether that was the intent of the law or whether they are morally beneficial."
"I say to them, if you do this, please do something that is not in the law and say you will not keep any money that would normally go to the schools," she said. "Allow the schools to receive their rate."
That is the same request made by longtime Carson City lawyer and lobbyist Bob Crowell, who is a member of the Carson City School Board.
"My argument was that this is not entirely equitable for redevelopment to get all these funds when the impact is going to be shared by all of Carson City," said Crowell. "I don't want the school district to be looked at as a spoiler.
"I welcome Costco. But when the money is split up, let's be fair about it. There will be 185-200 employees at that store and that means the school district will be educating those people's kids."
He said if the land in question were private property, schools would get their share of tax money based on the current value of the property. But because its tax value is currently zero, schools will see nothing.
Weaver agreed. Taxes from that property might be enough to hire another teacher, so it's not insignificant to the district. The value of the property, located at the rapidly developing intersection of highways 395 and 50, could vary from $3 million to $14 million.
Weaver said state law allows property-tax money to be collected by the redevelopment district and used for anything it wants anywhere within the district, which includes most of downtown Carson City.
"They have complete control over that money, including giving it to something like the school district," he said. "And since normally about 50 percent of the property tax money would go to the school district, I suggest they vote to share the money 50-50 with the school district."
Mayor Ray Masayko raised similar concerns about school funding when he cast the sole vote last week against adding the 15 acres to the redevelopment district.
"Money that comes to the redevelopment district is money taken away from the schools," Masayko said.
Vilardo said she will take the issue of public land being created as a redevelopment district before the 2001 Legislature because, "that's a policy question they must resolve."
But she said the proposed Costco deal, as well as a Douglas County deal which last year formed a redevelopment district "on a piece of sagebrush" for Target and Home Depot, raise a bigger issue for lawmakers.
"The whole thrust of the redevelopment law is revitalization of, say, downtown Carson City," she said. "These new redevelopment areas aren't being created for revitalization. They're economic development projects and that's not the same.
"But the way the law is worded allows that to happen, so there is a policy decision that has to be made and I think the Legislature will be addressing that much sooner than five years down the road."
Redevelopment districts are common in Nevada cities. They are often used to revitalize a downtown, as is the intention in Carson City, Reno and Sparks.
The district works this way: Taxes on the property values when the district was established - in 1986, in Carson City's case - are treated as they would be anywhere else. But taxes on increases in the value, beyond the amount established in 1986, go back to the redevelopment district.
For Carson City, those funds have largely been used to fund bonds to pay for downtown improvements such as the median plantings, wrought-iron fence and historic lamp posts.