First of all, no, hotel taxes belong to Clark County residents, just like any other kind of taxes — once they’re paid to the county treasury, you can use them for anything you want. (And it’s not like even taxes on out-of-towners are free money: If you raise them too high, visitors start staying away from town.)
Scottsdale plays this game, too. As summed up in the immortal words of city council member (and Wells Fargo banker…city council jobs were part-time positions before the dark side figured out they needed better representation) Linda Milhaven, Scottsdale’s bed tax, “…is not taxpayer money. It’s funds raised by the tourism industry, to be spent to benefit the tourism industry.” [I paraphrase, but if that’s not 100% accurate, it’s pretty darned close]
That rationale has been used in Scottsdale to justify taxpayer-funded subsidies to the PGA, Phil Mickelson, the Super Bowl, rugby scrums and polo matches (the latter two promoted by Mayor Jim Lane’s campaign PR manager, Jason Rose). Yet, we just BORROWED (via bonds) $12.5 million to patch potholes. In SCOTTSDALE!