After estimates of proceeds from a city car rental tax fell short of expectations, the Las Vegas City Council on March 18 approved the sale of $105 million in bonds against the car rental tax to fund a new performing arts center in the city. But the city still needed to make up a $45 million shortfall—the $105 million in bonds was short of original estimates of $150 million in proceeds from the rental car tax.
About an hour later, it was announced the city would soon close on the $85 million sale of redevelopment agency bonds to go toward various redevelopment projects. The funding would include money to make up the rental car tax shortfall in the city’s obligation for the performing arts center.
When backers of a yet unnamed downtown performing arts center went to local leaders in 2005 looking for seed money, the solution was a car rental tax hike on tourists.
The council’s vote came after estimates showed the tourism downturn hurting car rentals.
But the vote marked a shift toward more reliance on residents for financing. When the Legislature authorized local government to raise the tax on rental cars by 2 percentage points and use the money for the center, locals were prominently exempted.