Cathleen Allison/Nevada Appeal
Carson City and Douglas County should stop competing for business with redevelopment incentives and payments because it hurts the region, according to a Las Vegas-based marketing firm.
A report by Applied Analytics found the incentives can hurt Carson City and are not necessary for Douglas County.
Carson City supervisors said in April they want to share the study with Douglas County commissioners. The counties need to find a way to stop unnecessary redevelopment competition that hurts both counties, supervisors have said.
Douglas County commissioners haven't seen the report yet, but they will continue to work with Carson City to improve the region, said Greg Lynn, Douglas commission vice-chairman.
Carson City supervisors had the Northern Nevada Development Authority commission the study last year. Supervisors said the counties might be able to improve the region by sharing sales tax revenues from businesses near the county line.
The counties have competed over the last decade to draw businesses to southern Carson City or northern Douglas County.
The report, finished in December, said that $35 million in direct payments or tax incentives the counties have spent on developers, department stores and auto dealers had produced $45 million in sales taxes. The counties could keep more tax revenue and improve the region by cooperating without these incentives, according to Applied Analytics.
"This report does not seek to deter Douglas County or Carson City from seeking development; rather it seeks a recognition by both parties of the impact to the region resulting from the offering of public money to developers to locate on one side or another of a political border," the report said. "Failure to do so has one overarching impact " a net loss to the region."
Douglas has a tax structure that doesn't benefit from incentives, the report said. Douglas is one of nine rural counties known as a "guaranteed" county. The amount of sales taxes the state gives the county is relatively level no matter how many sales tax dollars are generated in the county.
Carson City is not a guaranteed county, so the amount of sales taxes it gets rises and falls with the amount of sales taxes generated in the county.
The taxpayer money being spent by both counties doesn't make the incentives worth it to either county, however, the report said.
Jeremy Aguero, lead author of the study, said in an interview that redevelopment spending competition between the counties doesn't get Douglas more sales tax dollars and forces the Carson to spend too much on attracting businesses.
"That is a negative for a community as a whole," he said.
Aguero said the best idea for a tax-sharing district would be to create a zone where new revenues are shared. The counties would lose money if they changed their designation as a guaranteed or non-guaranteed county, however, he said.
Carson City already knew that Douglas County's competition with the city hurt the region, Supervisor Shelly Aldean said.
She said the report in the end didn't show how Carson City could get the sales tax revenue it depends on without competing with Douglas County.
"It wasn't what I was looking for," she said.
Carson City and Douglas County have made a lot of progress recently in talks about what is best for the region, she said. Both counties also need to talk more about the reason for the counties' redevelopment spending and what can be done to help both, she said.
City Manager Larry Werner said he liked that the report emphasized that cooperation between the counties will bring success.
"If we all work together, we don't have to do anything special," he said.
The counties have already worked together to share infrastructure and emergency services, he said.
Douglas County can't control where businesses locate, but the "bad old days" of fighting between the counties is over, Lynn said.
"By and large, there is developing a spirit of cooperation and I think a lot of the cut-throat element will go away," he said.
The counties have a different attitude of respect and understanding than they used to, he said.
Rob Hooper, executive director of the Northern Nevada Development Authority, said he hadn't studied the report enough to comment on it.