Energy tax bill axed in Nevada Assembly

(AP) - What read as a tax on energy users to spur economic development quickly unraveled Wednesday before the Assembly Commerce and Labor Committee.

With Assemblywoman Marilyn Kirkpatrick, D-Las Vegas, sitting next to him, Assemblyman Randy Kirner, R-Reno, outlined a proposal that would transform AB202 from a bill that taxes energy use to promote economic development into a plan that would achieve the same goals using incentives instead of taxes.

The idea behind the original bill was to attract new manufacturing businesses to the state by using money from the utility tax to pay the businesses' energy bills. However, Kirner told the committee that once he saw the proposal in print he had to make a U-turn.

Although it would promote economic development, he said it would be a burden for Nevadans.

"I am uncomfortable with that," said Kirner, a sponsor of the bill.

Under the new proposal, for which Kirner sought Kirkpatrick's support, the state would attract new manufacturers with a combination of short-term and long-term benefits. The centerpiece of the proposal is a one-time property tax abatement of 35 percent if manufacturers bring existing buildings up to LEED energy efficiency standards.

Kirner said the proposal would have a watershed effect because the retrofit requirement would not only boost construction employment, but it would also transform idle buildings into vibrant ones.

The revived properties would then be more valuable and energy efficient, a benefit Kirkpatrick said will more than make up for the cost of the one-time tax abatement.

The new proposal retains the original bill's requirement that manufacturers provide at least 25 full-time jobs in Nevada.

The committee will review the bill again once it is rewritten.