Task force to suggest solutions for fairer tax distribution
by Sarah Cooper
Jul 13, 2008 | 607 views | 0 0 comments | 7 7 recommendations | email to a friend | print
In January, a group of 17 Sparks and Reno citizens started taking a careful look at how your taxes are gathered and then disbursed. The group’s goal was to make it all fair.

Concerns over unequal tax distribution between Reno, Sparks and Washoe County prompted the formation of the F.I.R.S.T (Fairness in Reno Sparks Taxes) blue ribbon task force, which was commissioned and funded by the cities of Sparks and Reno. After months of deliberation, the group is ready to submit its suggestions for fairer tax distribution to the Sparks and Reno city councils.

“We don’t want to give anyone an unfair advantage,” Glenn Dawson, a Sparks task force representative, said. “It is a collection and distribution issue.”

Dawson will stand with fellow Sparks member, Mike Sprinkle, before the Sparks and Reno city councils this coming week to present the findings and make recommendations for the coming legislative session.

When taxes are collected, they are pooled in a state fund and then redistributed based on a complex set of formulas, Sprinkle explained.

Regional distribution of sales tax illustrates the most widely varying numbers. While Reno generates 73 percent of all sales tax revenues throughout Washoe County, the city of Reno receives 28 percent of the consolidated tax distribution. Sparks provides the county with 20 percent of its sales tax and receives only 13 percent.

The committee’s report focuses on suggested changes in the consolidated tax structure, which takes into account cigarette tax, alcohol, property transfer, government services and sales taxes.

The task force’s report suggests that fairer distribution can be achieved through the creation of “an unincorporated area municipal tax structure to support the provision of municipal services to unincorporated area residents.” This change would include adjustments to the property tax structure and CTAX distribution formula.

Task force members said they were concerned that the current tax distribution structure was weighted too heavily in favor of the county, which leaves the municipalities in need.

To address this problem, the task force will recommend several options. First, that the distribution formulas be reconsidered or that the sales tax category be removed from the consolidated tax. If the category were to be removed, the revenues from sales taxes would go directly back to the areas where they were produced.

The committee agreed that with all of the various approaches to tax reform, they were not interested in raising taxes.

“We are really trying to avoid raising taxes,” Dawson said. “We know that we are in a recession right now and it is bad to raise taxes.”

The task force’s suggestions could be accepted in full or in part by the city councils.

“They could very well look at that (option) and take pieces of another,” Dawson said.

When it was created at the beginning of 2008, the committee was charged with determining the best method of tax distribution as well as the local authority necessary to fund government services.

In addition to finding solutions to the consolidated tax structure, the committee is also responsible for examining property and fuel taxes. They will continue to meet twice a month to assess these taxes and submit the final recommendations by September.
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