Property tax-cap plan criticized

A property tax plan modeled after California's Proposition 13 would actually raise the taxes of many people in Carson City and throughout the state, especially new homeowners, according to critics.

The Nevada Secretary of State and county election officials are reviewing the signatures gathered by We the People, a group directed by state senate candidate Sharron Angle, to see if the petition has enough verified signatures for the November ballot.

But the plan is not what many people think, said Carson City Assessor Dave Dawley.

Angle said her plan is fair, simple and predictable. Everyone's taxes are based on the same formula and, as part of the constitution, it can't be changed by a whim of the state, though it will continue to bring in revenue the government needs.

"It's a win win win," she said.

However, Dawley said it would raise many property owners' taxes for several reasons

The main problem is that new homeowners will pay property taxes based on the full market value of their property, he said.

Under the current 2005 law, property taxes for homes built before the law took effect are based on 2002 values and can't climb more than 3 percent a year, even if they are sold. An owner with a home built after 2005 pays full property taxes the first year with a 3 percent increase for each year after.

Other properties can go up 8 percent a year.

Under the new plan, all property taxes would be based on 2003 values and could go up 2 percent a year. If the property is sold, however, the new owner pays taxes based on the full market value with a 2 percent increase each year.

New homeowners under the new plan would start at comparatively high rate in most cases, Dawley said, and they could pay hundreds, if not thousands, of dollars more in taxes a year than a neighbor in an identical house.

"This will be a windfall for a local governments," he said, "but it's going to cost taxpayers a lot."

Close to half of property owners in Carson City could see their property taxes immediately go up under the plan, he said.

Voters would have to approve the plan twice for it to become part of the state constitution in 2011.

But Carole Vilardo, president of the Nevada Taxpayers Association, said state lawmakers tried to work carefully within the law to pass the current property tax cap, and Angle's petition doesn't take into consideration the effect of the new tax on a state with fast growth and quick house sales.

"I think the initiative is problematic," Vilardo said.

Angle didn't get enough signatures in 2004 and 2006 to get similar tax-cap plans on the ballot. She is challenging Senate Majority Leader Bill Raggio in the Republican primary.

Washoe County Assessor Joshua Miller said a plan similar to California's Proposition 13 could be good or bad for the state, depending on how people look at it.

It will ensure that some people who have owned their homes for a long time will pay even less in property taxes, but it could also be seen, he said, as "passing tax liability to future generations."

- Contact reporter Dave Frank at dfrank@nevadaappeal.com or 881-1212.