Rail Commission Meeting.
By Nicole Barde.
In 2010 the voters of Storey County passed the extension of the ¼ cent sales tax so that we could fund and build Tunnel 6 and purchase the freight depot. The ballot read “all monies raised in Storey County stays in Storey County”. Based on what I heard in the Rail Commissions May 21st meeting this was either a lie, the result of gross error and lack of due diligence or a random act of confusion on the part of Storey County officials.
So far we’ve sent over $1 million in tax revenues to the Rail Commission. We’ve received $25k and asked for $100k more for the Gold Hill depot. The rest of the $1 Million + is going to fund operational expenses of the Rail Commission. The Rail Commission says that the intent of the ¼ cent sales tax was always to fund their operational expenses in spite of the 2010 interlocal agreement signed between the County and the Rail Commission. That is not what I voted for, how about you?
Given what I heard at the May 21st Rail Commission meeting, Storey officials didn’t do their homework on what the meaning of “extension” is as well as understanding the “gotchas” in the interlocal agreement between the County and the Rail Commission.
Since 2010 the county has spent $50k+ for engineering studies for Tunnel 6 and over $500k in interest paid on a bond they sold in December 2010 to fund the project…with no project being built over the years. Over $550k wasted. Additionally, we have waited so long that now Tom Gray, to his credit has invested in his passenger depot, the original terminus, and the tunnel 6 access isn’t feasible. I understand that the County has finally struck a deal to buy the freight depot although I don’t know why if we have Tom Gray’s lovely passenger depot.
If the Rail Commission is right in their interpretation that the tax extension passed in 2010 goes to primarily fund operational expenses the County will have to fund the purchase and renovation of the freight depot without the full use of the ¼ cent sales tax monies and use a combination of the remaining bond funds and taxpayer money to do it. By taxpayer money I mean any and all revenue that lands in the County’s coffers is taxpayer money not just property taxes. Infrastructure money is also funded by tax revenues, its taxpayer money. All of it belongs to all of us to be spent wisely and to our best benefit.
The resolution of what the ¼ cent sales tax is to be used for is currently unfolding. We already know the Rail Commission doesn’t have the funds to fully meet the intent of the Ballot question.
The NEVADA COMMISSION for the RECONSTRUCTION of the V&T RAILWAY meets on a quarterly’ish basis. The most recent meeting, which I attended, was Thursday May21st 2015. You can view the agenda HERE.
There were a number of routine items but the “beef” of the meeting as far as I am concerned was the discussion around getting the other counties to provide the Rail Commission the financial support they are obligated to pay them by statute. Only Carson City and Storey County are meeting their obligations to the Rail Commission and without all of these funds the Rail Commission would have to shut the operations down. The other counties have not complied due mostly to the lack of enforcement of the statute on the part of the Rail Commission to get those funds. This isn’t just bad management it’s a complete failure of executing their fiduciary responsibilities as a BOD. They have put the continued existence of the enterprise at risk as a result.
The other item of interest was the review and approval of the 2015-2016 operating budget where the discussion about the ¼ cent sales tax funds that Storey is sending to the Rail Commission occurred.
At the end of the budget discussion I asked the question “Does the Commission have money in the contingency fund to pay Storey County should we decide to purchase the freight depot” After a bit of back and forth between the commissioners the first answer was “only if we shut down” then the answer was “yes, from the fund but why do you ask?”
I explained that I had heard Storey was close to an agreement to purchase the freight depot and that the 2010 interlocal agreement between the County and the Rail Commission stipulated that they would pony up $250k to match $250k that the County would put up to go towards the purchase of that depot and other county rail projects (i.e. Tunnel 6). Mr. Millard, Board chair, stated that there wasn’t anything in the original bill passed in 1994 that stipulated that particular use for the funds that they received from Storey County from the ¼ cent sales tax. That the 1994 bill was to fund the restoration of the line and the Rail Commissions operating expenses. That the monies from Storey County have been used for operational expenses. Additionally, Mr. Millard further stated that the ballot question passed by Storey County voters in 2010 was an extension of the original bill and since the original 1994 bill was for operational expenses then what the voters approved in 2010 was to fund the operational expenses of the Rail Commission.
I know this is detailed but hang in there.
I noted that the interlocal agreement signed in 2010 between Storey and the Rail Commission specified what the money was to be used for as did the Ballot passed in 2010. Mr. Millard said that the Rail Commission is following the intent of the 1994 bill but that the Rail Commission needed to read the interlocal. Interesting, they signed a CONTRACT which they drafted…didn’t they read it?
I don’t know it all but here is what I do know. I was part of the committee to help get the ballot passed. Those of us on that committee were told by County Manager Pat Whitten, who sat in on the committee meetings, that the ¼ cent sales tax extension was to complete Tunnel 6 all the way thru to the freight depot and buy the freight depot as the terminus for the V&T. That is also what was on the 2010 ballot that we all voted for along with the words “…all monies raised in Storey County stays in Storey County”. There were no real “Arguments against” on that ballot because we had little information. The only thing that we knew was that visitors would be those impacted the most. We didn’t know if or when the bond would be floated or the interest implications. So this didn’t appear on the Ballot. There was no mention of the interlocal agreement that was already in place between the County and the Rail Commission prior to the vote in November 2010. The interlocal contains the clause which says the Rail Commission keeps the monies to fund their operations if they need it first then Storey can get some for qualified projects. The committee I was on did not know of the existence of the interlocal agreement or its contents as we worked on getting the ballot passed it was never given to us. In the end I don’t know who wrote the ballot, Pat Whitten or Vanessa Stephens.
Prior to the ballot being passed in November 2010 the Storey County commissioners had already approved and spent about $50k +/- in engineering costs with Miles construction to come up with the plans.
Additionally, Resolution 10-321 which the commissioners approved in December 2010 specifically says in part“…..do hereby resolve to extend the continued collection of one percent sales tax dedicated to Virginia and Truckee Rail Road projects”.
So, the ballot gets passed. Storey County commissioners approve floating the bond, and then discover that the cost to build the tunnel is much higher than anticipated and nothing happens. Flash forward to 2013 where on several occasions the question of “what’s the status and where’s our money” gets raised in “public comment” at the Commissioners meeting and finally in the agenda of the 11/19/2013 and 2/18/2014 meetings. The answer to the question was that Tunnel 6 is no longer viable, that the owner of the freight depot doesn’t want to sell and Storey County doesn’t have a qualified project identified in order to request funds from the Rail Commission. Later they wanted to refurbish the Gold Hill Depot and got estimates that came in significantly higher than they thought and settled on asking for $100k for some improvements to the depot.
In 2013 Hugh Gallagher begins to research how much in tax revenues were sent to the Rail Commission…a little over $1 million and at the end of 2014 Pat Whitten sends a request to the Rail Commission. At the end of 2014 Hugh sends his numbers to the Rail Commission. The Rail Commission responds that Hugh’s numbers need to get verified by Taxation. In 2014 Storey County began withholding the ¼ cent sales tax monies from the Rail Commission until a figure is approved by both parties. Storey then asked for $100k for the use on the Gold Hill depot which should come by June 2015….but we’ll need more for purchase and renovation of the freight depot. .
What is astonishing to me is that there seems to have been NO due diligence done by Pat Whitten on the first bill passed in 1994 for the ballot which someone in Storey County wrote in 2010.
Additionally, it seemed to me after speaking with our County officials at the time that they did not fully read or understand what they agreed to in the interlocal agreement they (Bum Hess) signed.
I am also astonished to hear that the Rail Commission doesn’t seem to want to honor a CONTRACT that they drafted and then signed. In my mind all of the good work that they have done is overshadowed by this lack of accountability and unwillingness to honor their legal “word” and the Resolution 10-21 passed in 2010 by the Storey Commissioners…
Just to be clear, I love the railroad and want it to thrive. I am the daughter of an airline pilot and my grandfather was a train engineer for 35 years and ran trains in France during the war…which was dicey. I spent many hours on the flight line with my father and in train depots with my grandfather visiting “his” engines…..I love the smell of av gas and coal. I am PRO RAIL AND TRAIN…I am ANTI misleading voters, reneging on a contract and lack of doing your homework……regardless of the reason.