Tesla and TRIC – The Story Behind The Numbers, Part 1
Storey County made news last year when the Nevada Department of Taxation (NDT) released their figures for the Fiscal Year 2016-2017. Around the state, people took notice of the remarkable increase in taxable sales in Storey County. Thanks to Tesla and TRIC, Storey County’s taxable sales increased 568% over FY 2015-2016, thanks in large part to construction at the Gigafactory hitting stride.
The casual observer and anyone reading the press releases coming from GOED and TRIC would think that Storey County is enjoying quite the windfall from these sales. After all, Storey County takes home 5.6% of the 7.6% sales tax collected from sales within the County. However, when you take a closer look, you can see the windfall is not what you might expect.
The Storey Teller contacted the NDT and posed the question: How Much Did Storey County Deposit from that record $ 1.6 billion dollars windfall?
The answer will surprise you.
Some context to the $ 1.6 billion
In a previous article, we documented how much Storey County would have deposited without the abatements given to Tesla and Switch. We got the numbers for these charts from the NDT website which you can download for yourself here. The annual reports on the NDT site cover the years FY 2008-2009 through FY 2016-2017. In the charts below, the calendar year that the report ends in is how the accounting period is displayed, e.g. FY 2008-2009 is referred to as 2009.
Sales Tax Revenue Broken Down
The NDT websites annual statistic reports break the tax revenue to the counties in various categories. The major categories are Local School Support Tax (LSST), Basic City/County Relief Tax (BCCRT), and Supplemental City/County Relief Tax (SCCRT). In Storey County, we have three special tax revenue streams from voter-approved sales tax increases. Tourism, Infrastructure and the V&T Railroad all receive a quarter percent of taxable sales. Below we will compare the annual amount received from the years 2009-2017 to see how the trends stack up.
Local School Support Tax – 2.6%
Each County receives a portion of the tax collected for the schools; called the Local School Support Tax (LSST). In Storey County, the State transfers 2.6% of the 7.6% they collect here. The chart below shows the money Storey County received from 2007 – 2017.
The takeaway from this chart is that in 2013, when taxable sales were $77.28 million dollars, Storey County Schools deposited $1.61 million dollars while in 2017 we only deposited 1.37 million. When the taxable sales were truly off the charts, Storey County Schools did not enjoy record revenues.
Basic City/County Relief Tax (BCCRT) – .5%
Below is the BCCRT chart for 2009 – 2017.
The takeaway here is the 2015 figure of $518k is greater than the 2017 figure of $493k. Again, not what we would expect from a record year in taxable sales.
Supplemental City/County Relief Tax – 1.75%
Here we see that both 2009 and 2010 are greater than or equal to the record 2017 revenue. While this revenue is making a comeback, it is still not at 2009 levels in spite of the record $1.6 billion in taxable sales.
Infrastructure Numbers – .25%
We have a call into NDT to find out why their numbers for 2016 don’t match the numbers for Tourism or V&T. All three tax revenues are calculated at .25% and therefore they should all be the same. For every other year, they are identical. Stay Tuned.
V& T Railway Fund – .25%
Tourism Fund For VCTC – .25%
Total Sales Taxes Collected
The final chart tells the first part of the story behind the numbers. And it’s not a good story if you are a Storey County Taxpayer:
|Without Abatements||With Abatements|
|2.6% Local School Tax||$41,600,000.00||$1,337,523.04|
|.5% basic city-county relief tax (BCCRT)||$8,000,000.00||$493,281.21|
|1.75% supplemental city-county relief tax (SCCRT)||$28,000,000.00||$1,767,251.03|
|.25% promotion of tourism||$4,000,000.00||$304,380.00|
|.25% tri county railway commission||$4,000,000.00||$304,380.00|
|Total Tax Revenue||$89,600,000.00||$4,511,195.28|
Tesla and TRIC – Conclusion.
When we tally the figures above (LSST, BCCRT, SCCRT, Tourism, Railway, and Infrastructure) we discover that in terms of revenue from 2009 – 2017, total revenue fell in 2017 compared to 2016 despite the record 1.6 billion in taxable sales. And remember, we have to repay 35% of this money generated at TRIC so the amount we can actually use is even smaller.
In spite of what we hear from the County and TRIC public relations machines, the spectacular $1.6 billion in taxable sales yielded disappointing results in terms of total revenue in the coffers of the County. Without abatements, Storey County would have deposited nearly $90 million. However, we abated $85.5 million and deposited only $4.5 million.
On the other hand, our spending and hiring, however, continues to grow. The County has advertised for a half-dozen new hires in recent months while Comptroller Gallagher’s lone voice of guarded caution asks for the department heads to tighten belts.
When we compare these abatements to just two transactions TRIC made this year of $29 Million (Google) and $174 million (Blockchains) it’s not hard to figure out who the winners (Tesla and TRIC) and losers (you and me) are.
Meanwhile, Commissioner Jack McGuffey’s Website lists his Current Priorities. At the top of his list is:
Commissioners Gilman and McGuffey are irresponsible when they make these unrealistic claims. By suggesting they are tirelessly working to give “tax rebates or other means of compensation to the residents of Storey County”, they paint a picture of Storey County finances not based in financial reality. Either they know the county’s revenues are flat and continue to talk about something they know is simply not possible, or they simply aren’t paying close enough attention to the actual numbers.
Either way, they sell us short. Keep this in mind when you head to the ballot in the primary and the general elections this year.
Coming Up Next: Part 2; Tesla and TRIC – “The Deal of The Century”.