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Authority projects revenue increase in face of downturn

A national recession could be bad news for resort owners, but the booster group that promotes Las Vegas isn't projecting a downturn in its nearly $300 million budget.

On Tuesday, staff members of the Las Vegas Convention and Visitors Authority gave board members their first peek at the organization's projected budget for the 2009 fiscal year.

The budget proposal projects a 5 percent revenue increase in 2009 to $299 million, and calls for 2 percent increases each in marketing and advertising for a combined total of nearly $126 million to spend promoting Las Vegas as a destination.

The budget item was for board members' information only. They did not vote on the proposal, and there was no discussion.


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  • The authority also got an update on the political landscape from President and Chief Executive Officer Rossi Ralenkotter.

    The update came in the form of a proposal to hire the lobbying firm Jones Vargas to represent the authority in Carson City.

    Authority supporters have been spending lots of energy in the capital fighting off proposals to solve Nevada's budget problems by diverting room tax money from tourism promotion to education, roads and other programs.

    "All the discussions always include a room-tax component," Ralenkotter said. "We need to be diligent to protect our room-tax revenue."

    That diligence will cost the authority $15,000 a month when the Legislature is out of session and $20,000 a month when lawmakers are working. If the lobbyists succeed, however, they will have saved the authority millions of dollars.

    Room-tax rates now average 9 percent in Clark County. According to the convention authority, room taxes collected in fiscal year 2007 were more than $397.7 million. Of that total, the convention authority used 47 percent, or $191.9 million. Meanwhile 53 percent, or $205.8 million, went into total community support, including $72.6 million that was distributed to the Southern Nevada municipalities.

    The convention authority has projected room taxes will reach $456.3 million in fiscal 2009 and $571.8 million by 2012.

    Brenda Siddall, the authority's finance director, presented other fiscal housekeeping items to the board, including a proposal to announce its intention to back $300 million in bonds to support road improvements in Southern Nevada and a report on the need to shift $1.1 million to cover an unexpected increase in utility costs.

    Siddall said the unplanned utility spike was due largely to power consumption during the machine-heavy Association of Woodworking and Furnishing Suppliers show at the Las Vegas Convention Center in July, a time of hot temperatures and peak energy rates.

    Since then the authority has installed better monitoring equipment to avoid future surprises, she said.

    "We believe we will be able to track our energy use better," Siddall said.

    Siddall also briefly touched on the public health scandal stemming from unsafe practices at local clinics that potentially exposed thousands of local residents to disease.

    She suggested the board amend the authority's self-funded health plan to cover tests for employees who received letters saying they may have been exposed.

    The amendment could cost as much as $50,000, but Siddall said it won't affect premiums because the plan has adequate reserves to absorb the cost.

    Contact reporter Benjamin Spillman at bspillman@reviewjournal.com or 702-477-3861.



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    Ban Lobbyists wrote on April 09, 2008 01:22 PM: Can you imagine the impact if each agency hired its own lobbying firm to protect its portion of the budget. This is an outrageous waste of taxpayer dollars.

    Each agency should use its own staff to persuade lawmakers one way or the other. It is a bad precedent to set.


    Charge More! wrote on April 09, 2008 01:16 PM: Everyone seems to forget that the Authority has the ability to charge for the services it provides. If a customer chooses to schedule their show during the summer months, charge them more. We should encourage energy intensive shows to schedule during the cool months anyway.

    Also, allow the hotels to decide if they are getting the best advertising bang for the buck. Let the hotels keep their room-tax money and pay the authority if they believe they are doing a good job.


    No Solution For Illegals wrote on April 09, 2008 01:04 PM: Nevada will never implement measures to curb illegals, because the hotels won't allow it. Everyone knows that our resorts are full of illegal employees. Why do you think that all hotel workers no longer need a sheriffs card?

    Our plight could get worse as adjacent states make laws to rid themselves of illegals. The governor and lawmakers won't do anything to help the citizens in this regard, otherwise their campaign money would dry up.

    The lobbyists are a waste of taxpayer money, because the reason that our budgets are extended is due to the illegals that hotels need for employees.


    Why Build Now? wrote on April 09, 2008 12:57 PM: The LVCVA is doing a massive building project at a time when dollars are scarce. Rumor has it that tens of millions of dollars have been spent without any holes being dug (can someone verify this)

    If postponing building will help prevent teacher layoffs or letting prisoners go free, it is worth it.

    You would think the state entities would share in the pain of the budget shortfall. Some some to be saying let them eat cake.


    ths wrote on April 09, 2008 11:10 AM: I have to agree with Douglas here.

    They are able to balance their budgets including supporting road construction and giving 50% of its tax take to local government. What else you want?

    They support themselves by attracting visitors, conventions and much more that stay in hotel rooms. It is those hotel stays and the 90% occupancy that they have been able to sustain for so long that makes them flush with cash.

    We should punish them for being successful? If they don't attract people we would not just lose out on the room tax, but the gaming, car rental, and sales tax.

    They should defend themselves from people in political power or people that want to push their agenda through propositions. These are people that don't look at the big picture, but more a self serving interest.


    douglas wrote on April 09, 2008 10:06 AM: the convention authority shouldn't have to defend itself against frivolous suits.

    since the educational system refuses to rid itself of illegal infiltrator parasites draining their budgets, they require zero additional funding.

    if a fellow refuses to plug the holes in his gas tank, should neighbors be required to buy him gas ?


    Lobbyist Spending? wrote on April 09, 2008 09:06 AM: It doesn't sound right for the authority to spend money to protect itself. It is like the state spending money to negotiate with itself.