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CALL FOR HIGHER GAMING TAX: Exec labels proposal 'extortion'

Sands Corp. boss says room tax squandered on tourism group




Las Vegas Sands President Bill Weidner has joined the chorus of casino executives with a proposal to bail the state out of its current financial crisis without raising gaming taxes: transfer the money generated through hotel room taxes into the general fund and reduce the role of the Las Vegas Convention and Visitors Authority.

If the idea sounds familiar, it is. Las Vegas Sands executives have long advocated privatizing the Las Vegas Convention Center and diminishing the influence of the convention authority, which is funded by room taxes.

The company, which operates The Venetian and is opening the $1.6 billion Palazzo this month, also operates the 1 million-square-foot Sands Expo and Convention Center, which vies for business with the Las Vegas Convention Center.

Weidner said Friday the proposal isn't about getting rid of a competitor. He just doesn't believe Nevada needs additional taxes or a tax increase, and he also believes that the state could make better use of its room taxes dollars, which are projected to exceed $425 million by 2008.


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  • "I don't know why we have this institutional negative view about looking at a tax that is being squandered," Weidner said. "We, as an industry, produce and collect that tax. Yet we don't get any credit for it."

    Nevada is facing a budget shortfall of more than $285 million, according to recent projections. MGM Mirage Chairman Terry Lanni and Boyd Gaming President Keith Smith have proposed that the state adopt a broad-based business tax as a way to generate more revenues. Meanwhile, two initiative campaigns are pushing for increases in the gross gaming tax that is paid by large casinos. That tax is 6.75 percent. The state teachers union wants to increase the gaming tax to 9.75 percent, with the proceeds funding increased salaries for educators.

    Weidner called raising taxes a knee-jerk reaction to what he believes is a short-term problem. He's opposed to any new business taxes and he called the teachers' tax proposal an "extortion" measure on the state's largest industry.

    "I think it's a good advertisement to be known as a low-tax state that tries to keep taxes low for businesses and citizens," Weidner said. "I think it's a mistake to go away from that."

    He said divertiing room taxes from the convention authority and into the general fund would add $200 million to $300 million this year. The Las Vegas Convention Center could also charge higher rates and have a larger profit margin if it were owned by a private entity.

    Weidner, who said Las Vegas Sands is exploring building a new convention center on land east of its current one, would not be interested in buying the Las Vegas Convention Center.

    Convention Authority President and CEO Rossi Ralenkotter defends the current system, which helps fund the convention authority and brings new business to all of the city's hotel-casinos.

    He said the agency does not compete with Las Vegas Sands for business. Instead, the organization promotes Las Vegas as a destination for conventions against other large cities, such as Chicago, San Francisco, New York and Orlando, Fla. The authority's 50-year-old business model complements efforts by the hotel industry.

    Ralenkotter also opposes selling the convention center to private ownership.

    "Our model works at filling rooms," Ralenkotter said. "It's part of the partnership with the hotels. We help get the people to the destination and it's up to the hotels to bring the people to their properties."

    In the recent legislative session, Las Vegas Sands executives and Gov. Jim Gibbons proposed taking room tax funds away from the convention authority to help pay for highway construction. In the end, a compromise was reached in which the convention authority agreed to give up $20 million a year over the next 30 years to fund road improvements to Interstate 15 through the resort corridor.

    "We showed our willingness to be part of the solution and we think everyone should come together once again to look at these issues," Ralenkotter said.

    Weidner said his proposal should generate conversation and draw attention to the state's taxation issues.

    "We need to ask the right questions, such as what is it we need to do to make the tax system work," he said.

    Lanni also opposes Weidner's efforts to eliminate the convention authority, saying a broad-based business tax is the fairest way to ensure all business entities participate in funding state government.

    But he wasn't surprised that Weidner resurrected the room tax proposal.

    "I think if you raised the issue of homeland security, (Las Vegas Sands) would bring up eliminating the LVCVA as a solution," Lanni said.

    Contact reporter Howard Stutz at hstutz@reviewjournal.com or (702) 477-3871.

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    Ed Spear wrote on December 11, 2007 08:52 AM: Convention authorities funded through room tax revenues drive the engine that maintains Nevada's economy. A broad based business tax makes far more sence, because the different Convention authorities promote taravel into and throughout Nevada, which generates more tax revenue than any other segment of the taxed community. From fuel taxes, personnal property, entertainment, alcohol, gaming and sales tax revenues are all a direct result of the marketing and promoting efforts through out Nevada by the romm tax authorities. The LVCVA is the recognized leader in the tourism industry not only in the US but throughout the world. Perhaps it would make more sence to bring the states many workers and policies in line with the private sector, you may be surprized of how the states budget would change.


    douglas wrote on December 08, 2007 08:11 PM: the massive shortfall at the federal level is due to entitlements. that means freebies handed out to citizens and non-citizens who paid lille or nothing into any system to begin with. with hapless harry reid at the helm of the senate and the wannabe gus hall clone, ms pelosi at the helm in the house, those entitlements will continue to expand.

    worse would be if the "progressives" control the white house. those promised, new freebie programs will be the straws that break the backs of the u.s. taxprayers. instead of only 50 or so percent, the "progressives" could get the combined tax rates to over 70%. someone's gotta pay for the "open borders" rush of hapless harry's "pre-citizens". it won't be the unskilled millions who invade.

    but the good news is that an earlier poster stated that those school taxes i've been paying for decades as indicated on my property tax bills, were illegal. in anticipation of regaining those many thousands, using the poster's "proof", i'll stop by the wynn/penske ferrari store tomorrow. what with the chinese, ustabe communists buying most production, the wait list might be long. but those tax refunds are always slow anyway.

    that poster's "proof" that property taxes didn't have a school tax component is the best christmas present i've ever gotten.


    Ed wrote on December 08, 2007 07:39 PM: OK, raise the tax. Casino operators in return close some casinos.

    Now who loses? Everyone.

    Don't be stupid, Bill Weidner knows what the hell he's talking about.


    Chris wrote on December 08, 2007 05:34 PM: Ya right more taxes, i think its the feds who need more money to fund the war.


    douglas wrote on December 08, 2007 04:38 PM: if as the poster "proved" that buildings don't pay for education, then i have quite a bit of a refund due. for decades, the property tax bills on various residential and commercial buildings, here and in other jurisdictions, have included in the summary, "school taxes".

    using the poster's "proof", how do we taxprayers begin getting those thousands of dollars back ?

    my ability to earn money on the many businesses i've had, did *not* depend on anyone's education. it might be said that an uneducated consumer would make for an even better customer, wouldn't it ?

    the lifelong taxes i've paid, both through property and income, by far exceed the cost of those benefits i've received from taxprayer funded services. that of course includes school costs. a corollary to that is hapless harry reid's agenda to provide free or at least "resident" tuition for illegal infiltrators/saboteurs [his "pre-citizens"]. otoh, i paid an "out of state" tuition for the first year of college in nevada.

    if any citizen elects to make [no, the stork didn't make them] more bambinos than the can afford, absolutely, positively it is *not* the responsibility of others to pick up the tab. same as more frugal citizens cannot be required to pay for some "blemished" credit loan bailout. pay for what you use; buy what you can afford; do not demand that other citizens pay for your largesse.

    those who think that they should pay for others' luxuries have the solution at hand... their checkbook. the operative word is "their", not to be confused with the rest of the citizenry's checkbooks. apparently those with their liberal agenda want other to pay, not them. if i had such a communist yoke, guess i'd adopt a vow of poverty and send all proceeds to some gubmit or charity.


    TMC wrote on December 08, 2007 02:51 PM: Extortion indeed. That from an industry that pays only 6.75%, increased recently and only slightly for the first time since the late 80's. Their business runs the government in Nevada and impacts the infrastructure the most. Let them pay a rate in conformity to other states and not a nominal single digit tax rate.


    David Tracy wrote on December 08, 2007 01:49 PM: Douglas asks: "As to casinos or any business paying to educate someone, anyone's children, that's dishonest from the start. How many children does a building send to school?"

    Buildings don't pay for education, but taxes on casino earnings certainly will.

    Douglas asks: "What responsibility does any taxpayer have to support and educate his / her neighbor's [kids], who might choose to [have] more than he can support?

    Our economy absolutely depends on an educated workforce. Douglas' ability to make a living is absolutely dependent upon the workers in our economy having an education. Chances are Douglas was educated in the public schools, and he gets to pay that back (with a little help from the "buildings" on the Strip (with licenses to steal). And if a man has more children than he can support, or he dies or becomes disabled, his children should go uneducated?

    Douglas writes: "The only legit [argument] might be that hotels or any development should pay *some* portion of the specific infrastructure costs accessing the business, that subdivision.

    An educated workforce is part of that infrastructure, and part of the infrastucture that built and maintains the roads, sewers, utility lines, etc. that keep the casinos in business.


    douglas wrote on December 08, 2007 01:33 PM: lost on those who may not now pay any taxes, who likely extract more from society than they pay into it, is that a low gaming tax is needed for the long term solvency of nevada.

    same as if hapless harry reid drives electric generation costs into orbit by his [and the eco-loonie clique] agendas. with hapless harry's "vows" to drive up electric bills and gasoline prices. or, a major gaming tax increase [6% to 12% is a 100% increase for example]. thus we could expect financial trouble for tyaxpraying nevada citizens in the future.

    since most casino licensees are multinational, they have choices for siting those new, billion buck, 5-8 thousand employee, facilities. because of the relatively low gaming tax, they continue to build those facilities here, despite the intense competition. obviously a substantially higher gaming tax should make even higher tax rate jurisdictions more attractive, considering the lack of competition. that's the major reason that macau [and soon, other asian sites] will net, outperform *all* u.s. casinos combined.


    say what wrote on December 08, 2007 12:56 PM: the casinos tax is only 6.75%..tax the casinos now..


    douglas wrote on December 08, 2007 12:52 PM: as to casinos paying "slave" wages, that's a joke. those jobs, particularly those with tokes, are way better than some retail or fast food job. that explains why when a new joint opens with mebbe 5000 job openings, 1 or 2 hundred thousand applications are received. to use the poster's "proof" that must mean that those casinos only pay "slave" wages. and considering that even the "unskilled" housekeeping jobs in casinos have better wages and benefits, the "slave wage" statement is false.

    as to casinos or any business paying to educate someone, anyone's children, that's dishonest from the start. how many children does a building send to school ? what responsibility does any taxprayer have to support and educate my neighbor who might choose to make more bambinos than he can support ? should my neighbors pay to maintain my house or garden ? my pets ? if one can't afford to buy the gas for a hummer, don't buy one in the first place. asking the neighbors to chip in for gas is beneath dishonest.

    the only legit complaint might be that hotels or any development should pay *some* portion of the specific infrastructure costs accessing the business, that subdivision. this they do already. they shouldn't pay *all* those improvements since for example, a wider roadway out front usually serves other people, businesses, downstream. and, those improvements to enhance the profitability of those businesses served, ultimately result in higher property taxes plus state & local tax collection. yes, virginia, profitability of a business is considered when assessing taxes.

    as to the venetian, it seems that while nonunion, the guy pays all the other joints do and offers such things as free, on site daycare for employees. that's why it tough to get a spot there... more applicants than openings.


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