CARSON CITY - The typical casino, with its tobacco-tainted air, might not seem likely to earn the label "environmentally friendly."
And yet, Hatice Gecol, director of the state Office of Energy, issued a regulation in March that said a casino with smoking customers could be considered "green," or environmentally friendly.
That ruling allowed casinos to qualify as green buildings under Nevada law that granted massive property and sales tax breaks for companies that built environmentally friendly buildings.
Gecol, who is also Gov. Jim Gibbons' chief energy adviser, didn't return two phone calls Tuesday for comment.
The tax breaks could translate into as much as $900 million in lost revenue during the next decade, according to the Clark County School District. State legislators and analysts acknowledge they know little about the amount of the potential loss in revenue.
Given discouraging new revenue projections, the Legislature passed a bill freezing the tax breaks last week; Gibbons hasn't decided whether to sign or veto it.
The source of the anxiety is a 2005 bill that offered incentives to build green buildings, using standards developed by the private, nonprofit U.S. Green Building Council. The standards are called the LEED Green Building Rating System, for Leadership in Energy and Environmental Design.
The goal is to create buildings that are healthy, efficient and environmentally friendly.
The Legislature apparently failed to account for the impact of the tax breaks, as large companies such as MGM Mirage and Boyd Gaming began planning for the tax relief with their new Strip mixed-use projects, CityCenter and Echelon Place.
Many other corporations are also vying for the breaks, including Sheldon Adelson's Las Vegas Sands.
The smoking issue didn't present much of a problem for developers at CityCenter, MGM Mirage's $7.4 billion resort complex. MGM designed CityCenter as an office complex, with separate nonsmoking buildings and ventilation systems that don't mix with casino air and are therefore eligible for certification.
Other casino developers are building traditional single-structure buildings in which casino floors sit in cavernous spaces surrounded by hotel lobbies and other features.
The Gecol exception would seem to help developers of those traditional smoking casinos qualify for the tax breaks, assuming they met other standards. It could also allow MGM to qualify its stand-alone smoking casino, if it meets other green building standards.
And with that, the noble goal of green building could prove very costly in a cash-strapped state, while the effect of the law may not exactly be in line with the intentions of the Legislature.
The state Tax Commission compounded the confusion and concern by failing to write regulations. The situation became ever more curious with the Office of Energy's ruling in March.
The smoking regulation, issued March 23, says a building that doesn't meet LEED standards "solely because of its failure to satisfy the requirements of the LEED Green Building Rating System relating to the control of environmental tobacco smoke" can still be certified as green.
Michelle Moore, vice president of community for the U.S. Green Building Council in Washington, D.C., expressed disappointment about the decision. "You can't demonstrate leadership in green building practices and allow smoking indoors," she said.
Sen. Dina Titus, D-Las Vegas, noted dryly: "That wouldn't be considered to be green by many people."
Legislators have already expressed disapproval with the state agencies' role in the green building issue, which they say has ratcheted up the cost of the law.
In addition to making an exception for smoking buildings, Gecol also claimed considerable authority with the March regulation. If a new LEED standard is introduced, she has asserted that she has the authority to set aside the standard and adopt her own.
Steve Rypka, who serves on the board of the U.S. Green Building Council and has a Las Vegas-based "green-living" business called GreenDream Enterprises, said the smoking issue was non-negotiable by LEED standards.
Rypka said the U.S. Green Building Council tried to work with developers so hotels and retail businesses could be considered green if the smoking casino was clearly separate from the casino. In that case, the hotel and retail would be green, the casino not.
The exemption granted by Gecol would seem to make the discussion moot.
Rypka said he hoped the 2005 law would allow Las Vegas to showcase itself as more than just a place for adult fun, but also as an environmentally conscious community using innovative building and design to tackle big problems, such as water shortages and global warming.
He said he hopes the tax incentive stays in place, in some form. But it should be more than a corporate giveaway, he said.
"If we're giving this strong incentive for doing green building, we should get something back," he said. "There should be benefits across the board, not just to the corporate entities. It should be a meaningful incentive that creates true change."
Coolican reported from Carson City and Benston from Las Vegas.
J. Patrick Coolican can be reached at 569-3174 or at [email protected].
archive