Nevada brothels want to be good neighbors and pay taxes

MOUND HOUSE - If visitors to the Moonlite BunnyRanch aren't too distracted by the half-naked woman in skyscraper heels likely to be lounging at the bar, they might notice a small glass box stuffed with dollar bills near the door.

This month, the brothel is collecting donations for the Silver Springs Spay and Neuter Clinic. Two months ago, it was the local children's museum.

"I give back to my community," said brothel owner Dennis Hof, who pimps for about 200 women at two brothels in the high desert five miles outside Carson City.

Many others in the industry, which is legal by county option in Nevada, want to go further.

They're asking to be taxed.

Although county governments collect license fees, the state of Nevada has never taxed brothels. If an industry lobbying group and an anti-prostitution lawmaker have their way, that could change this year.

"I don't believe in legal prostitution, but I'm not a zealot about it, either," said Assemblywoman Sheila Leslie, D-Reno.

Ten of 17 counties in Nevada allow brothels, and Leslie said there's no move to change state law to block counties from allowing prostitution.

"They're a legal business. They should contribute like every other legal business, and I'm willing to make that happen," Leslie said.

That's music to the ears of many in the always-skittish industry. For them, a state tax is a stamp of legitimacy, and something they've pursued for years.

Two years ago during a budget shortage, the brothels came close to getting their wish, but last-minute negotiations inadvertently exempted them from a tax on live entertainment.

Now they're renewing their offer, despite the state's surplus of more than $300 million.

"I understand the state is no longer short of funds," said Geoff Arnold, president of the Nevada Brothel Association. "But our philosophy is that the brothels want to be good neighbors and want to help the community."

There's more than altruism in the offer. Unlike other legal businesses, the 28 bordellos in the state aren't allowed to advertise - a widely acknowledged but unchallenged First Amendment conflict.

Media-savvy owners like Hof find ways to get the word out, such as offering free sex to soldiers returning from Iraq.

Others say they ought to be able to advertise, and if they have to pay a tax to get closer to that goal, that's the cost of doing business.

"I think we should have the same rights as any other business, but I also am a realist," said Bobbi Davis, owner of the Shady Lady Ranch, a brothel about 120 miles outside Las Vegas. "And I think this tax thing is also a way to go. There's a price, sometimes, for legitimacy."

Leslie's bill wouldn't set the price very high - about $2 per client. It would bring in about $1 million a year.

The funds would come from the brothel, not the prostitutes themselves, who work as independent contractors and generally give the house 50 percent of what they charge for each "party."

"The state is not going into the business of taking a direct percentage of parties," Arnold said.

Owners don't seem concerned the bill will affect business. Nevada brothels make from $20 million to $50 million annually, Arnold said.

"Precious," who arrived at the Shady Lady Ranch a week ago from St. Paul, Minn., said even if owners pass the tax on to prostitutes, it won't affect her budget.

"What's a couple extra dollars off? I can waste that on lip gloss or new eyeliner," she said. "That's chump change for what some of the girls make here."

Prostitutes at Shady Lady Ranch make up to $1,000 daily during peak tourist season, she said.

But owners like Hof say they already pay their fair share to county governments and shouldn't have to "duck their heads under the sagebrush" or "pay for legitimacy."

Counties charge a quarterly business fee ranging from $100 to $20,000, and prostitutes pay $50 for an annual work permit.

Some counties get as much as 25 percent of their business fees from brothels, a legislative analysis shows. Lyon County, home of the BunnyRanch, will collect $316,000 in brothel business fees and $25,000 in permit fees next year.

That contribution, and Nevada's libertarian leanings, lead many people to say the brothels don't need the goodwill a state tax might earn them.

"People in Nevada are still sort of interested in the law of the Old West: If someone doesn't bother you, leave them alone," Arnold said.

Hof said he wants to be left alone and prefers to contribute his way, without apologies or new state taxes.

"Audrey," one of Hof's employees, agreed.

"I'd rather see the gentlemen put their $2 in the charity box," she said.