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DOUGLAS COUNTY BALLOT QUESTION # 2:

Shall the Board of County Commissioners of Douglas County impose a sales and use tax of

0.25% in the County for the period beginning July 1, 2017 and ending June 30, 2027 to fund

capital projects for the Douglas County School District (including the improvement and

equipping of school facilities for repairs predicated on health and safety issues as well as critical

needs and the payment of debt service on bonds or other obligations issued for such purposes)?

Explanation: A “yes” vote would authorize Douglas County, Nevada (the

“County”) to impose a sales and use tax of 1/4 of 1% on the gross receipts of any retailer from

the sale of all tangible personal property sold at retail, or stored, used or otherwise consumed in

the County, to provide funding for Douglas County School District (the “District”) to improve

and equip school facilities. If approved, the tax would be imposed for the period beginning July

1, 2017 and ending June 30, 2027.

The District anticipates using the funds generated by the sales and use tax for

capital projects within the District, including, but not limited to: (i) acquiring, improving and

equipping certain HVAC systems, bathrooms, intercom systems and repeater systems at

elementary schools, middle schools and high schools; (ii) repairing certain existing buildings

through the abatement of hazardous materials at elementary schools, middle schools and high

schools; (iii) acquiring, improving and equipping certain fire alarm systems at elementary

schools and middle schools; (iv) acquiring, improving and equipping certain plumbing systems

at elementary schools; and (v) acquiring, improving and equipping certain electrical systems at

middle schools.

The proceeds of the tax imposed must be deposited in the District’s fund for

capital projects. The proceeds of the tax imposed may be pledged to the payment of principal

and interest on bonds or other obligations issued by the District for the capital projects described

above, and the Board of Trustees of the District may issue bonds or other obligations for those

purposes. The proceeds of the tax imposed may not be used to (i) settle or arbitrate disputes

between a recognized organization representing employees of the District and the District, or to

settle negotiations, or (ii) to adjust the District-wide salaries and benefits of the employees of the

District.

A “no” vote would prevent the sales and use tax of 1/4 of 1% from being imposed

by the County, and the District would not have the revenues from such tax as a funding source

for the District’s capital projects.

Argument For the Sales and Use Tax:

A “YES” vote on Question # 2 will fund critical renovations and repairs at local schools,

providing a healthy and safe learning environment for our community’s children. The

Legislature recognized that many of Nevada’s schools were in need of improvements to address

facilities in disrepair and the overcrowding of schools and authorized local school districts to

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form committees to recommend the imposition of taxes to address these needs. Douglas County

School District’s Public Schools Overcrowding and Repair Needs Committee consists a diverse

group of our state legislators, local business people, and school district representatives, and, after

looking at all of the numbers, the committee recommends this tax as necessary to improve our

schools.

Some of the county’s schools currently have inadequate plumbing, air conditioning, and

electrical systems. Others need new fire alarms and signage to comply with fire code

regulations. Bathrooms need repairs, and other facilities need improvements to meet federal

disability regulations. Building repairs are needed to abate the presence of hazardous materials.

Not making these needed changes will be penny wise and pound foolish as the School District

may be exposed to increased legal challenges and operating costs.

Lack of funding prevents basic repairs and other improvements to the schools that will ensure

our children have a healthy and safe learning environment. Unless additional funding can be

secured, the costs of these repairs and improvements will affect operating budgets and could

result in cuts to essential programs, increased class sizes, or even school closings.

Increasing the sales and use tax by 0.25% would raise our current sales tax from 7.1% to 7.35%.

Our sales tax rate would still be lower than our surrounding neighbors in Carson City (7.6%),

Washoe County (7.725%), Storey County (7.6%), and Churchill County (7.6%). The additional

annual cost to the average resident in Douglas County, based on spending an average of $10,000

per year on goods subject to the sales and use tax, is anticipated at only $25 per year, or less than

fifty cents a week.

Because the proposed 0.25% tax increase is only intended to solve our current problems and is

not intended to be permanent, it is required to end after ten years. Only a vote of the people can

extend the proposed tax if we, the voters, not the politicians, decide it needs to remain.

Finally, we want to maintain the high property values we enjoy in Douglas County. Studies

indicate that people will pay higher prices for homes located in good school districts, like our

district. Even if you do not have children or grandchildren attending our local schools, by voting

“YES” on Question #2, you are voting to support good schools which will maintain and increase

our property values.

Educating our children is vital to our community’s future. For approximately $2 per month, we

can each help provide the children in our community with school environments that are healthy

and safe, and maintain the high rankings of our local schools which benefits us all.

Rebuttal to Argument For the Sales and Use Tax: None Submitted

Argument Against the Sales and Use Tax:

The Douglas County School District already receives $15.5 million annually from local sales tax

revenues. It has an $85 million annual operating budget and about $15.2 million in annual

capital and debt related funds. The School District Committee estimates spending an additional

$10 million on capital projects between 2017 and 2027, funded by this proposed sales and use

tax increase. With an operating budget of $85 million per year, the School District can allocate

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its funds more efficiently so as to make the necessary repairs to the schools without costing more

to county residents who will be affected by the sales and use tax. Or the additional $10 million

could come from other sources. The costs can be spread out over ten years to reduce the impact

to the School District’s budget.

Raising the sales and use tax in the county by 0.25% will increase the sales and use tax in

Douglas County to 7.35%. It will reduce the sales tax advantage of shopping in Douglas County

versus the surrounding counties. Lyon County’s sales tax will be lower at 7.1%. Carson City’s

and Storey County’s sale’s tax rates will be only 0.25% more, instead of the 0.5% more

currently.

Raising the sales and use tax in the county by 0.25% will also affect our county residents, many

of whom are retired and receive limited fixed incomes, and who do not have children in the local

schools. The School District says it will cost the average person only $25 extra dollars per year.

However, if $25 per resident is such a small amount, then the School District should be able to

capture that money from other sources, such as wages and benefits.

The School District already expends $11,463 per year on each student. Surely the School

District can make adjustments to its budget to accommodate the necessary repairs to the schools

without increasing the taxes the community pays out of pocket.

Voting “NO” on Ballot Question #2 will force the School District to spend your tax dollars more

carefully. Poor education hurts the community, but higher taxes also hurt the community.

Rebuttal to Argument Against the Sales and Use T ax: None Submitted

Anticipated Financial Effect: The sales and use tax increase of 1/4 of 1% would

expire on June 30, 2027. The average annual cost of this sales and use tax increase is expected

to be $25 for a typical payer of sales and use tax in the County, based on average annual

expenditures on goods that are subject to the sales and use tax of $10,000. Following the

imposition of the tax, additional expenses may need to be paid from the General Fund for the

operation, maintenance and repair of the school facilities funded with the sales and use tax.