Amid a burgeoning housing crisis, the Clark County Council voted 4-1 to approve a 0.01 percent sales tax Tuesday that will generate about $6.5 million a year for affordable housing and behavioral health services.
The tax, which consumers will see on their receipts in April, will add 10 cents to a $100 purchase, according to a staff report supplied to the council during an Aug. 27 work session. The tax revenues can be used for the construction, acquisition and maintenance of affordable housing for those who make 60 percent of the area median income or less, which is $49,560 for an individual.
During Tuesday’s discussion, council members cited the urgency to find solutions as more residents become priced out of their homes.
Councilor Wil Fuentes said “$6.5 million is not a lot of money, but it will help address some of the critical issues with a lack of affordable housing that we are experiencing now and probably into the foreseeable future, because I don’t know that there is a solution for it right now.”
Councilor Michele Belkot voted against the tax. She raised questions about how the money will be tracked and spent.
“We’ve already imposed record-setting taxes on Clark County residents,” Belkot said.
How the money will be spent has not been decided yet and will depend on council direction, according to Tuesday’s meeting. County Manager Kathleen Otto said the council can hold policy discussions or create a separate fund to track the tax’s revenue.
“To me, that’s like putting the cart before the horse. … We’re going to impose this and say ‘Oh, we might be able to explain this to you.’ … You can’t reverse a tax once you implement it. I’ve never heard of that ever happening.”
Belkot asked to have a work session before voting. Otto pointed out the council has already discussed the tax several times. In August, the county held a work session on affordable housing, which included this potential funding stream. During an October council meeting, council members discussed the funding again, Otto said.
Councilor Matt Little said that although the tax seems small, it can add up.
“Everyone is struggling. This is money that will put more taxes on people who are struggling, and it will go to … help people with housing,” Little said.
Still, councilors said it would be in the best interest to approve the tax as one way to address the housing crisis. Councilors agreed to continue conversations about how the funding will be spent.
Clark County has had the highest eviction rate per capita in the state for two consecutive years. A recent National Low Income Housing Coalition report found that a Clark County renter would need to earn more than $33 an hour or work 83 hours at minimum wage to afford a one-bedroom apartment at the fair market rate of $1,750 a month.
“I do agree that we pass it now because we are experiencing a housing crisis, and the sooner that we’re able to invest in ways that we can reverse that and help people to be able to stay in their homes, is critical,” Councilor Glen Yung said.