City economist walks Reno planning commission through "C tax" and how revenue reaches local governments

Jason Gortari, the city's urban economist, told the Reno Planning Commission on Aug. 5 that Nevada's consolidated tax, commonly called the "C tax," bundles six revenue sources and distributes them to counties and local governments according to a multi-step formula.

Gortari said sales tax makes up more than 80% of the statewide C tax bucket and noted the scale: "you start with $2,200,000,000 and by the time it gets to Reno, we get about 31%" of the Washoe distribution. He emphasized how distribution rules and point-of-origin formulas change how much a given city receives. "On a $100 transaction, buyer pays $8.27 in taxes, but the Reno Reno gets only 69¢," he said.

Why it matters: C tax is a major revenue source for local governments. Gortari told commissioners that the C tax accounts for about 31% of Reno's general fund budget and roughly $100 million for the city in a recent fiscal year. He walked through each component (liquor, cigarette, governmental-service tax, real-property-transfer tax and two sales-tax pieces), explained point-of-origin versus population allocation, and described how base and excess formulas allocate growth and protect guaranteed counties.

Commissioners asked technical questions about the population figures (Gortari said allocations use the state demographer's governor-certified annual estimates), guaranteed-county inflation adjustments and how municipalities account for front-loaded construction sales when forecasting revenue. Gortari and staff said the base distribution is calculated annually with a five-year average adjustment and that any excess revenue is distributed based on growth factors that include population and assessed-value changes.

The presentation was positioned as part of the city's revenue-education campaign; Gortari directed commissioners and the public to reno.gov/ctax for further materials.