Nevada’s Live Entertainment Tax & What it Means for BMan

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Nevada’s Live Entertainment Tax & What it Means for BMan

Post by trilobyte » Fri Dec 11, 2015 4:07 pm

From the Burning Man Journal...

Usually around this time of year, we’ve got Black Rock City ticket information for you, but this year is a bit different.

You may have heard that earlier this year the Nevada Legislature passed a law amending the state’s Live Entertainment Tax (“LET”). These amendments (SB266) levy a 9% tax on the admission charge to an event held in a facility where “live entertainment” is provided. More specifically, NRS 368A.200.3 requires that the tax “must be added to and collected from the purchaser at the time of purchase.” The tax now even applies to events produced by 501(c)(3) nonprofit organizations — like Burning Man — if they sell at least 7,500 tickets to their event. SB266 can be found in its entirety here.

Notably, all boxing matches, NASCAR races, and professional and college sporting events when the Nevada-based home team is playing have been exempted from SB266, even though those events clearly constitute “live entertainment.”

Public statements by the bill’s sponsors and the Nevada Department of Taxation suggest the 2015 amendments were intended to target Burning Man specifically. Burning Man and its participants already contribute an estimated $50 million to the Northern Nevada economy every year, and Burners pay sales taxes, hotel/lodging taxes, and gas taxes. While we support Nevada’s right to collect fair taxes, we don’t believe the LET applies to Burning Man, and we intend to challenge it.

Black Rock City is an experiment in temporary community on 14,000 acres of the wide open Black Rock Desert. While the Burning Man organization provides the space and basic infrastructure for Black Rock City, we simply don’t provide live entertainment as defined by the statute. Black Rock City is not an arena concert, a sporting event or a Las Vegas show; it’s a thriving metropolis with all the trappings of a functioning temporary city, with people camping, cooking meals, visiting neighbors, and exploring the offerings of its citizens.

It’s a city of participants who gather to celebrate self-expression, gifting and community — and who happen to know how to throw a fantastic party for their friends. They conceive and build hundreds of interactive theme camps, art installations, mutant vehicles, costumes and performances, and they gift them for the benefit and enjoyment of each other.

It’s clear from this legislation the Burning Man event has been misunderstood. So, we are looking into the LET and trying to understand how it is meant to be applied. We’re also working to educate the Legislature so they understand what Burning Man is and how it works.

From our perspective, this is the latest attempt by an outside entity to unfairly tap the resources of Burning Man and its participants. Some seem to view Burning Man as the “golden goose” they can turn to when they want money for other projects. This happened most recently in 2014 with the Bureau of Land Management seeking money for VIP accommodations, but it’s been a trend for many years.

The tax seems to be unavoidable for 2016. We will know more as this process unfolds, but we’re not able to finalize 2016 ticket sales until we have more information. We know this may affect you and your campmates as you make plans for Black Rock City 2016, but we owe it to our community to fully understand our best path forward.

We will update you as soon as possible, and will have further details about 2016 ticket sales in the new year. Until then, you can get more information about the LET and https://www.leg.state.nv.us/Session/78th2015/Bills/SB/SB266_EN.pdf[url]SB266[/url] from the Nevada Department of Taxation at (775) 684-2020 or from the bill’s sponsor, Nevada State Senator Mark Lipparelli at (775) 684-1475. If you wish to express your opinion please do so diplomatically, because — as one of its creators — you represent Burning Man, and we want the legislature to see our community in the best possible light.

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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by vargaso » Fri Dec 11, 2015 5:52 pm

So remember kids: don't post your DJ lineups, for chrissakes.

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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by EspressoDude » Fri Dec 11, 2015 7:18 pm

"Notably, all boxing matches, NASCAR races, and professional and college sporting events when the Nevada-based home team is playing have been exempted from SB266, even though those events clearly constitute “live entertainment.”"


Thunderdome is tax exempt.
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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by lucky420 » Fri Dec 11, 2015 8:03 pm

EDC is also a big target of this bill. I'd say a bigger target than bm if you look at it population wise
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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by trilobyte » Fri Dec 11, 2015 9:00 pm

i agree, though the proverbial ball is now in Nevada lawmaker's court to grant Burning Man an extension. When you consider that extensions are granted to boxing matches and NASCAR pretty much on the basis that they bring in a lot of people from out of state who then throw money around with local businesses.... we've got that covered in a big big way!!!!! Forget the random event tourists who fly in for a weekend stay at a hotel and throw so,e ,oney at local restaurants and casinos in the day and a half they're in town, burners spend a couple days on the way in and a couple days on the way out. Plus, we lay out a ridiculous amount of money at vehicle rental agencies, grocery chains and liquor stores, and let's not forget the hardware stores and building supply joints. Pound for pound and participant to participant, someone who comes to Nevada for Burning Man spends significantly more money in the state than someone who comes in for boxing or car races.

It is very significantly unfair for the state of Nevada to give spectators of those events a break while sticking it to us. Because that's what the deal is, the tax is paid by Burning Man participants in the form of a tax on the price of tickets.

Speaking personally, as a participant, of the state of Nevada does not grant Burning Man an exemption than I will make a point of spending significantly less money with NV businesses. I live close enough that some freshies and grocery items I purchase in Reno to support local businesses can be purchased in California and kept on ice. I'll haul water from California and look at other ways to reduce my event-related spending in the state. If Burning Man tickets are impacted by this tax, the response is to put the screws to Nevada business owners in hopes that maybe they will be more successful in convincing state lawmakers to grant Burning Man the same consideration as any other event that brings signifiicant dollars into the state.

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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by lucky420 » Fri Dec 11, 2015 10:14 pm

One thing to consider; if the tax was implemented would it be an even bigger incentive for the State to tell Pershing County to chill out? Could this potentially be a benefit to burners?

Not necessarily while traveling through Pershing on I80, I'd still expect speeding tickets but while on playa don't be so dickish. I don't know if the State would have any pull with the BLM at all or not.

I'm rambling now ... :mrgreen:
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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by Simon of the Playa » Sat Dec 12, 2015 6:29 am

this is the part where i say


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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by ridingnitro » Sat Dec 12, 2015 7:01 am

Nevada State Senator Mark Lipparelli

@NevadaML23

https://www.facebook.com/mark.lipparelli

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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by lucky420 » Sat Dec 12, 2015 7:36 am

Simon of the Playa wrote:this is the part where i say


"i told you so, bitches".

Yep!
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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by RudolphDiesel » Sat Dec 12, 2015 8:49 am

Ok, I have to state IANAL or a tax consultant I am a realtor, but that said, I have a problem seeing where Nevada wants to attach that tax to.

Burning Man is a California organization and as such if taxable anywhere it is taxable in CA. The tickets are sold in CA, again outside of the legislative reach of NV. The event is held on federal land, outside the legislative reach of NV.
Up to this day the way I understood the taxation in the US that you need to attach taxes to the point where value is created or changes hand. That is the point of sale. In (trying) to impose taxes on a transaction that happens in CA, with a CA organization, and in most cases with individuals not in NV or not living in NV, how can the NV department of finances hope to get something? Did I miss a dramatic change in legislation?

I would assume that would be the first attack vector.

E.g. If I buy a ticket, living in TX, buying the ticket in CA via the internet (which we all do) where is it that NV tries to insert itself?

They can most certainly insert themselves at tickets sold at the gate (however many that may be, and we all know the number is 0, so taxable from the gate $0), or NV can impose an extra tax to water/ice or whatever else is being delivered to BM, by NV organizations. But outside of that I have a problem understanding where the problem is.

Can somebody shed light on that for me? (And most likely for many others as well ?)

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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by unjonharley » Sat Dec 12, 2015 9:15 am

I can buy everything I need outside of NV.. I'm willing to buy some bulk to help others..
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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by Elliot » Sat Dec 12, 2015 10:11 am

How about.... Rather than boycott Nevada businesses, which could strengthen Nevada's argument that we don't spend much in their state, compared with boxing and racing spectators; might we be able to document how much we spend?

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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by some seeing eye » Sat Dec 12, 2015 11:35 am

Some thoughts...

Nevada is like any state, but more so. It wants taxes for state services, but it's voters don't want to pay them. Luckily NV has all kinds of tourists it can tax. The legislators from Reno opposed taxing BM, but a D legislator in LV argued for it for years. (All our discussion here, thanks Simon, for not announcing the DJ lineups, which the BMORG finally adopted as policy was an argument BM should not be subject to the Live Entertainment Tax) But the R governor did put together a tax package which included BM and all the legislative record demonstrates BM and EDC were targeted.

The various exemptions for boxing and NASCAR were undoubtedly negotiated after huge lobbying effort$ over the years. So one route is for BMORG to get its wealthy donors and enthusiasts, like the shoe guy, or that car guy building a battery factory in Reno, to go down that road. But they could also give those dollars to the ORG for non-lobbying purposes instead. Or the org could go to court, which is costly, and may not be easy with the legislative record.

The Live Entertainment Tax gathers maybe $140M a year, probably higher in 2016. So BM's 2.8M is small in comparison to all the other entities who pay the tax and would like to lobby to get out of it.

I have no attraction to NV, or the playa, though I do like fire. But NV is one of the few places in the USA with 24 hour alcohol and public intoxication is legal. That is not essential to me for the event, but it seems well established in the culture.

The new law is a little odd, the tax is calculated on the lowest cost tier of tickets generally available to the public. So it is likely the BMORG is thinking though its tiering strategy.

BMORG-burners could probably do a better job at measuring their local economic impact. EDC estimates their impact at 6x BM's.

Not sure if out of staters writing NV legislators will be positive. Maybe the BMORG negotiating more state services, or fiber to Gerlach for our new taxes could work?

Here is some more info on the tax - http://www.dickinson-wright.com/news-al ... -number-15
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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by Skuzzy61 » Sat Dec 12, 2015 11:58 am

Seems to me, and I am just spit balling here, BM is not one event, but a collection of hundreds of events all happening at one location. Just a thought, if anyone wants to follow that one down the rabbit hole.
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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by Popeye » Sat Dec 12, 2015 12:38 pm

From SSE's link above:
There are some previously exempt venues that are now under the LET umbrella. This includes outdoor entertainment on both gaming and non-gaming property, legal escort services, nonprofits that sell more than 7,500 tickets per event, and nonprofits where patrons provide the entertainment if the nonprofit sells more than 15,000 tickets to the event (e.g., the Burning Man festival in northern Nevada).
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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by Simon of the Playa » Sat Dec 12, 2015 5:04 pm

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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by Thecatman » Sun Dec 13, 2015 12:09 am

trilobite wrote:burners spend a couple days on the way in and a couple days on the way out. Plus, we lay out a ridiculous amount of money at vehicle rental agencies, grocery chains and liquor stores, and lets not forget the hardware stores and building supply joints. Pound for pound and participant to participant, someone who comes to Nevada for Burning Man spends significantly more money in the state than someone who come in for boxing or car races.

Can't forget what the airport rakes in either. Even though there is no quote on the amount, it has to in the millions as well. Just a quote from KOLO 8 News in Reno from 2013
RENO, NV – Thousands of people will be dusting off and flying home as Burning Man comes to an end. Reno-Tahoe International Airport will be sending off more than 15,000 tired Burners. Monday and Tuesday will be the busiest days for travel as Burning Man attendees return from the playa, along with the Labor Day weekend traffic.

Burning Man is the largest single event this year at Reno-Tahoe International with over 30,000 passengers arriving to and departing from the airport.


The same statement was made this year by I forget what her name is but the head honcho of airport.
Even Reno mayor Hillary Schieve was at the airport this year greeting burners as they arrived.
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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by Chains of Rose » Mon Jan 04, 2016 11:21 pm

Just a thought.

Nevada is trying to make revenue from the sale of burning man tickets, and I assume this is on the posted face-value of the ticket. So, not the $1000.00 scalped one, but the entry fee of $390.00 and $50.00 vehicle pass. For argument sake, I drove in with a friend and we shared the vehicle pass. My entry fee to Black Rock City was $415.00

If I break down my ticket price in comparison to 2014's Financial Highlights, I have the following:

Administration: $65.32
Fundraising: $2.37
Programming: $347.31

I'm wondering if there could be a way to notate the actual "entry fee" on each ticket as $70.00. The difference could be made up in a "donation" program that would allow patrons to pledge a donation along with their purchase that would allow them a preferential "wave" when tickets go on sale or something like that. I haven't completely thought this through, and I know there would be a huge outcry regarding "fairness" and the term "affluent" might get thrown around a lot. I'm just wondering if there is a way where we could remove some of the power from scalpers, allow artists to support other artists, and even give the state of Nevada something to think about when it comes to taxing an organic, yet organized event like Burning Man.

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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by qball » Sat Jan 09, 2016 8:03 am

Is there any harm in looking at other locations?
There is the Alvord desert in Oregon just north of the Black rock desert that is big enough for to hold burning man and Oregon has legalised weed so some of the arguments about law enforcement would disappear with location too.

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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by Sham » Sat Jan 09, 2016 8:28 am

Welcome to eplaya qball.
I think moving the event out of Nevada is one of the possible options in the future. So many people have only attended this event in the Black Rock Desert, so moving it would break some hearts in the process. In a perfect world, BM could use even more land, better road access and more local infrastructure. Still, the remoteness of Black Rock City has made the event so unique and moving it would dilute the whole charm of it.

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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by Elderberry » Sat Jan 09, 2016 9:50 am

Sham wrote:Welcome to eplaya qball.
I think moving the event out of Nevada is one of the possible options in the future. So many people have only attended this event in the Black Rock Desert, so moving it would break some hearts in the process. In a perfect world, BM could use even more land, better road access and more local infrastructure. Still, the remoteness of Black Rock City has made the event so unique and moving it would dilute the whole charm of it.
Did people say the same thing when they moved it from Baker Beach?
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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by Leo » Sat Jan 09, 2016 6:14 pm

The Alvord Desert in Southern Oregon gets my vote. Weed is legal in Oregon. Nuff said.
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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by motskyroonmatick » Sat Jan 09, 2016 10:04 pm

The alvord desert has access issues and the current event width is pretty much as wide as the alvord is. IMHO it's even more remote than the black rock when it comes to existing available emergency services like air ambulance transport and heavy rescue not to mention full service shopping centers are far away.
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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by lucky420 » Sun Jan 10, 2016 5:41 am

Alvord desert on federal BLM land, weed is still illegal.
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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by some seeing eye » Sun Jan 10, 2016 7:17 am

I would like to see the event truly leave no trace, rather than the current, pick up most of the trash after the party so as to leave less trace. Given that is the current state, no to Alvord, in my opinion.

By the way, even though there is a back and forth between BMORG and BLM, it's a damn good relationship, and can only improve with the Neil Kornze appointment.

If you have been following the news, the Sagebrush Rebellion is back. I think some Repubs are going to get the idea to sell off all the Westlands to balance the budget, or give it away to the counties to be exploited mercilessly. At that point BM could just buy the Black Rock Desert then sublease it to other events.

As far as taxes, this is how the big kids respond to a political policy they don't like: http://www.reviewjournal.com/business/s ... ering-rate. BM just does not have that card to play.
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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by unjonharley » Sun Jan 10, 2016 8:48 am

Let ttitd be in black rock.. Those tax will not stop me..

I will have a few things to say under my breath..

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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by Elliot » Sun Jan 10, 2016 11:48 am

some seeing eye wrote:... this is how the big kids respond to a political policy they don't like: http://www.reviewjournal.com/business/s ... ering-rate. ...
If this is how the "big kids"....

Let me tell you how far I got into that article. I got to where one side said he called the other side on Christmas Eve, and the fellow didn't answer.

He called to talk business on Christmas Eve? And was surprised the other fellow didn't answer the phone?! And that was a major argument why negotiations could not progress?!

If that's how "big kids" operate... they are truly children.

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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by some seeing eye » Sun Jan 10, 2016 4:01 pm

I have a different interpretation. Solar City can wield power. Burning Man is not yet at that stage. In my opinion, power is wielded in the soft martial arts way, with communication, compassion but decisiveness.

Political power dynamics are completely different than 1:1 relationships where traditional power dynamics are a negative. But that does not mean that I, who believe in 1:1 negotiation and joint problem solving, do not believe in wielding power on large issues upon which I and my cohorts agree.

Burning man is building a pretty interesting set of potential allies like Elon Musk, Tony Hsieh, the Googlers, Jeff Bezos. That is why I support the .org outreach and networking projects others think are crazy, an unnecessary expense and violate the culture. It is also why there need to be non-tented, non-Green Tortoise opportunities for those potential allies to experience the event for their first time, while honoring Burning Man culture and norms. The measure of success is if those allies return for year 2 and beyond.

I think Burning Man, through its engagements with wealthy idealists can learn to wield power. Given the culture of BM, they may and should choose to do it quietly.

I would also say that the quid pro quo in elected politics, "I'll give you x$ to do yPolicy" is sickening and disgusting. But until it is illegal, it is what we have. I would speculate with no information to support that the ORG deals with all kinds of negotiations and struggles which they don't publicize. It allow us to enter a TAZ utopia for a week thinking it is really that.

Hahaha - this is a philosophy post! Move as you like.
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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by Popeye » Sun Jan 10, 2016 5:08 pm

some seeing eye wrote: Burning man is building a pretty interesting set of potential allies like Elon Musk, Tony Hsieh, the Googlers, Jeff Bezos. That is why I support the .org outreach and networking projects others think are crazy, an unnecessary expense and violate the culture. It is also why there need to be non-tented, non-Green Tortoise opportunities for those potential allies to experience the event for their first time, while honoring Burning Man culture and norms. The measure of success is if those allies return for year 2 and beyond.

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Re: Nevada’s Live Entertainment Tax & What it Means for BMan

Post by BBadger » Sun Jan 10, 2016 5:20 pm

Ulisse wrote:SSE: What do you mean by non-tented?
What I take it to mean is that accommodations are not brought in on their backs, but provided for them by others.

Like those friends and family members we bring that aren't necessarily "participating" by building or bringing camp, but by their mere presence shared in that special place. Essentially they're plugging and playing, but they bring value in their own way.
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