Taxing Area 51 - 8 News NOW

Taxing Area 51

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George Knapp's Street Talk
Led by Award-winning investigative reporter George Knapp, the Eyewitness News I-TEAM is the top television investigative unit in southern Nevada. Political expert Jon Ralston provides insight into local and state government, and former Mayor Jan Jones adds an insider's viewer of City Hall. I-TEAM photographer Eric Sorenson rounds out this first-class investigative unit.


The military base known as Area 51 has long been regarded as one of the most mysterious facilities in the world. Recently released satellite photos have stripped away some of the aura of secrecy, but the new photos also have given ammunition to Nevada counties who say Area 51 -- and the military in genera -- owes Nevada taxpayers millions of dollars. George Knapp of the I-Team has the exclusive story.

It's pretty tough to assess taxes on a base that doesn't exist, which is what the military told the world for years when asked about Area 51. Here in Nevada, we've known for a long time the place was out there in the desert, but for local officials trying to get a little tax revenue out of the base, the fight for information has gone on. The new satellite photos could make a difference.

Residnts of Lincoln County -- all 4,100 of them -- are generally a patriotic bunch, tolerant of a military presence that sometimes means sonic booms and broken windows in towns like Pioche or Panaca. But the county is stagnant economically, hurting for revenue sources. So when a federal court ruled in the early '90s that counties could assess taxes on some operations at military bases, Lincoln County's eyes turned to that most non-secret of secret bases -- Area 51.

Under the law, local governments can't tax the federal government, but they can tax contractors who use federal equipment to make a profit. Area 51 is loaded with private contractors, the same companies that have developed whiz-bang spy planes and Star Wars gizmos and who knows what else out there. And that could mean sorely needed taxes for Lincoln and other counties.

Joe Moffo runs a Pioche radio station and isn’t shy about saying the military should pay what it owes: “I'd step in and say, ‘Hey, you're here. Pay!’”

However, Lincoln County officials aren’t as vocal. They declined to talk about the taxes owed by Area 51. The assessors office would only confirm for us that negotiations are under way with the Air Force, and that no one wants to scuttle the talks by sounding off. Nor would anyone tell us what amounts are involved; residents say that whatever the amount, it's desperately needed.

Moffo tells us what his county could use the additional tax money for: “A nicer library than what we’ve got, instead of raising sales taxes to pay for a school bond issue. We could have other things that would help. We should get some revenue, using our facilities and we don’t get no revenue.”

That's where the new satellite photos come in. The photos were posted on the Internet a few months ago. They are so detailed that the Lincoln County taxman can go over the Groom Lake Base, building by building, and get a much better idea what might be owed. Again, Lincoln County won’t say that's what they're doing, but sources on the federal side say that's what they've been told.

It's not just a Lincoln County issue: Mineral County is in the same straights; Nye County has had ongoing issues over taxes owed by government contractors; ditto here in Clark County.

Would Clark County staffers resort to using satellite photos to get needed information? “Absolutely,” says Clark County assessor Mark Schofield.

You probably didn’t know that some of the planes flying ahead are hired by the county to get a better idea what taxes you too might owe. Clark County has no beef with Area 51, which is 100 miles north, but its dispute with Nellis contractors dates back to 1992.

Lincoln County won’t say what it is owed by Area 51, but the folks operating at Nellis owe Clark County about $4 million and change, a hefty chunk. Nellis, of course, isn’t nearly as secretive as Area 51, but the assessors have had to resort to some James Bond tactics to get the needed information.

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