How Gaming Benefits Nevada
Over a third of all funding for Nevada's public schools comes from the gaming industry.
Funding School Construction
The Clark County School District ("CCSD") primarily funds the construction of schools with a combination of three revenue sources:
- Ad valorem (property) tax - Property tax is collected in Clark County at an average rate of $3.147 per $100 of assessed value; $0.5534 per $100 of assessed value is allocated to the CCSD for school construction.
- Real property transfer tax - Real property transfer tax, which is collected by the county recorder when an interest in real property is conveyed, is allocated to the Clark County School District Capital Projects Fund at a rate of $0.60 for each $500 of value.
- Transient lodging tax (i.e., room tax) - The hotel/motel room tax, which is levied at a rate of up to 13 percent, is also collected in Clark County and allocated partially to the CCSD for school construction.
Of these three sources of revenue for school district construction, property tax is by far the most significant, accounting for 75 percent of construction revenues. Room tax is the second-largest revenue source, accounting for 15 percent of all collections, with the volatile real property tax rounding out the last 10 percent. In fiscal year 2014, room tax alone generated nearly $78 million for school construction in Clark County. It has provided nearly $1 billion since 1998.
Clark County School Construction Revenues Generated Through Room Tax
Sources: LVCVA; Nevada Department of Taxation and Applied Analysis. *Note: The Clark County School District receives other property tax revenue as well, in the form of the dedicated statewide levy of $0.75 per $100 of assessed value for school maintenance and operation. See Nevada Taxpayers Association, Nevada Tax Facts.
In 2009, voters in Clark, Washoe and Lander counties approved Initiative Petition 1 (“IP 1”), which imposed an additional 3 percent tax on lodging revenues (to the extent the total rate does not exceed 13 percent). IP 1 was imposed by the Legislature only in Clark and Washoe counties, and for the first two years (fiscal years 2010 and 2011), funds generated were directed to the State General Fund. Effective July 1, 2011, taxes generated under IP 1 were deposited in the State Distributive School Account, and effective July 1, 2013, the funds are designated to be used to increase teachers’ salaries and improve student achievement.
In fiscal year 2014, $139.3 million was generated in Clark County for the statewide education fund. Including Washoe County, revenue generated for education under IP 1 totaled $140.9 million.