Construction: Road plan may spur changes

13 June 2007

LAS VEGAS, Nevada -- An agreement that provided $1 billion to alleviate traffic congestion in Nevada may also give Las Vegas tourism boosters unprecedented influence over funding for new road projects.

That's how leaders of the Las Vegas Convention and Visitors Authority described a recent deal inspired by Gov. Jim Gibbons that diverts portions of property, rental car and hotel room taxes to upgrade roads without imposing any new taxes.

Authority President Rossi Ralenkotter said the tourism agency's board of directors won't authorize their share of the funding until board members are convinced the money is for road projects that relate directly to tourism.

As far as Ralenkotter recalls during his 34 years at the convention and visitors authority it will be the most influence the group has ever wielded over road projects.

"These are room tax dollars. We need to make sure the projects ... have a substantial impact on the tourism corridor," Ralenkotter said.

But spokesman Scott Magruder of the Nevada Department of Transportation downplayed the role the authority would have in road funding decisions. Magruder said the tourism agency will have an advisory role but the transportation department will ultimately determine the fate of road projects.

"Basically what I am hearing from our deputy director is they don't get to vote on it," Magruder said. "I believe (NDOT) has the final say."

Gibbons spokeswoman Melissa Subbotin said she thinks the funding bill the governor signed on June 6 does includes power for the tourism group to sign off on projects to which it will contribute. But she quickly added disputes over who authorizes projects funded with the authority's money would be moot if both sides want the same road improvements.

"I believe it is really a collaboration," Subbotin said.

The road plan raises $1 billion over the next 20 years by combining up to $20 million annually from the authority's share of hotel room taxes with diversions from rental car and property taxes. The combined total, about $65 million, would be enough to service bonds worth $1 billion.

Authority spokesman Vince Alberta said the tourism group wants its contributions to go toward projects along Interstate 15 parallel to the Strip and west to California.

"We have final sign-off," Alberta said. "It provides us the ability to ensure the funds we have committed are being used for highway projects that benefit tourism."

At least two of the five projects on a list NDOT says it will start in the next two years seem to meet the criteria Alberta described.

They include adding express lanes to I-15 between Sahara Avenue and Tropicana Boulevard and another project to widen I-15 from six to eight lanes between Tropicana and Blue Diamond Road.

"They have to show there is a nexis with tourism," Alberta said. "If we agree with that, that is the authority we provide."

Alberta said NDOT will bring projects to the authority board before they are funded. Magruder said NDOT will collaborate with the authority before prioritizing projects but the department will retain decision-making power.

Magruder said NDOT will stick to its process of using one-, three- and 20-year statewide transportation improvement plans, called STIPs, and modifying the plans with input from counties and other groups.

"What we would say is that (the tourism authority) would be maybe just part of the process before we go to the (transportation department's) board of directors," Magruder said.

The funding plan was the result of a heated debate between Gibbons and Las Vegas tourism leaders. Gibbons' original proposal called for the authority to send $424 million from its share of room taxes to the state to pay for roads, about 32 percent of the authority's share of room tax. Authority leaders cried foul and claimed it would scuttle their plan for an $890 million expansion of the Las Vegas Convention Center.

The compromise Gibbons signed into law took just 8 percent of the authority's projected 2009 room tax and included the other tax diversions.

But Brenda Siddall, the authority's finance director, said it will still be a challenge to squeeze the money from the group's budget, which is now about $279 million.

"Any time you take 8 percent out of an operating budget you are going to experience some pain," Siddall said.

The authority gets 47 percent of revenue from a 9 percent room tax in Clark County, which worked out to about $200 million in the current budget. The rest of the $426 million in room taxes goes to everything from schools to roads, statewide tourism promotion and payments to local governments.

After the road funding plan goes into effect, the authority's share of room taxes will be about 46 percent, Ralenkotter said.

To raise the money Siddall said the authority would freeze hiring in 2009 and limit personnel growth to 1 percent in 2010-11, 2 percent in 2013 and 3 percent in 2014.

It will also reduce a $185 million capital improvement fund by $42 million to $143 million and extend an eight-year maintenance program by two years. The $890 million expansion is still on schedule to be complete by 2011.


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