A proposal to raise the town’s current room tax is expected to draw much discussion at the upcoming Pahrump Town Board meeting next week.
Town Board Chairman Harley Kulkin authored the agenda item, which calls for raising the room tax rate to 13 percent, a 5-percentage point increase.
If approved, Kulkin hopes to use the money to purchase the town’s fairgrounds project.
He said the item first caught his attention when it appeared on the Pahrump Regional Planning Commission’s agenda.
“Some time ago, there was an item on there about the room tax so obviously the county is looking at maybe doing that when they take over,” Kulkin said. “There’s nothing more important than the fairgrounds development in Pahrump.”
Though Town of Pahrump Finance Director Michael Sullivan chose not to comment on agenda item itself, he did provide information on Pahrump’s Room Tax Fund structure.
He noted that last year, approximately $500,000 of room tax funds were collected in Pahrump.
“The current town room tax rate is 8 percent, while the state room tax is one percent, for a total of nine percent,” Sullivan said. “It is collected from both hotel and RV space rentals. We allocate our share of the room tax based on prior town board action to five special room tax revenue funds including the airport, fairgrounds, parks, economic development, arena and tourism. The state remits back to the town one-third of the one percent they collect here, and that goes into a separate room tax fund. Each year during the budget cycle, the town board appropriates the room taxes collected or accumulated to various tasks.”
In providing her own recommendation to Kulkin’s agenda item, Town Manager Susan Holecheck suggested that now may not be the appropriate time to consider the action.
“Staff would recommend first meeting with all potentially affected business entities,” she said. “Staff does not believe this is the appropriate time for such an increase. We are now just beginning to see an uptick in tourism and this increase might hamper tourism as well as economic development.”
Kulkin’s colleague, Vice chair Bill Dolan, said his first thoughts were that of the local resort industry who cater to tourists visiting the Pahrump community.
“How does this affect the businesses in this community that offer hotel rooms and are they on board with it?” Dolan asked. “I would think probably not.”
At present the room tax rate in Pahrump stands at nine percent.
Dolan suggested holding off on any attempt to take action hiking the tax rate.
“I would hope the businesses that this would affect will be at the meeting to give us their feedback,” he said. “At this point, I really don’t see a need for us to do that right now, because moving it to 13 percent would cap out the room tax under the current NRS. A four percent increase is a pretty big jump.”
Additionally, Dolan questioned the timing of the agenda item.
“I just don’t see us or the rationale of why this is being done at our last meeting,” he said. “This should be a very non-contentious meeting where we can thank the community for the opportunity for us to serve, while we wish the county well.”
Efforts to contact a representative from the two major resort casinos in town were unsuccessful by press time Thursday.
Additionally on Tuesday, the town is expected to consider whether to approve spending $7,500 for 850 linear-feet of chain link fence at Blosser Park on the north end of town.
The board is also expected to consider approving Town Manager Susan Holecheck’s end of the year performance evaluation without monetary adjustments.