Redevelopment money sought to bond events center
Events center supporters seeking a $34.25 million pledge from Douglas County’s redevelopment area say the money is necessary if they’re to bond to build the $100 million project.
About half the money for the center will come from a $5 per night surcharge on Tahoe Township lodging approved by the 2019 Legislature.
“The Legislature did not provide us with an alternative funding source,” said Lake Tahoe Visitors Authority Director Carol Chaplin. “It provided us with the primary funding source, but that, without RDA 2, does not build the events center.”
NHA Advisors’ Mark Northcross broke down the issue for county commissioners at a presentation on the events center and its funding last week.
He said that the project is seeking a maximum of $1.3 million a year from redevelopment.
He said that one of the issues for bond investors will be the worst-case scenario for funding the $7 million threshold.
“If you look at the boom economy there’s more than $7 million, so why do you need the tax increment?” he said. “Bond investors are conservative and look at the worst possible case. The Great Recession and Indian gaming really hammered the casino core.”
He said revenues dropped to $5.8 million, below the $7 million threshold.
“From a standpoint of selling bonds for the events center, if something like the Great Recession repeated, this tax increment brings us up beyond the worst-case scenario.”
Northcross said that with the events center, the number of room nights in the Stateline casino core will go up, with actual revenues increasing $7-9 million. Without it, he said analysis showed annual revenue would decline by about $400,000.
Because the Stateline casinos are assessed based on their revenues, that means the less money they make, the less money is collected by the county.
“The bottom line is that this project has a positive fiscal impact on the county,” Northcross said.
Proponent Lew Feldman said Tahoe Douglas Visitors Authority officials expect to present the center to the Tahoe Regional Planning Agency at their meeting later this month.
Visitors Authority officials say they will present a request for a commitment to the center’s funding to Douglas County commissioners at their March meeting in Stateline.
“We are turning away business that would fill an events center because we don’t have the space,” Feldman said. “We knew that in the 2000s and we know that now.”
He pointed out that Heavenly Village was the result of a similar public-private partnership.
“You don’t have to go very far to see a public-private partnership,” he said. “Heavenly Village is a turn-around project.”
A five-acre site at Highway 50 and Loop Road is being donated by Edgewood that will establish the events center as an entryway to Stateline.
“We have a parking lot view we’re proposing to replace that if we move forward with Loop Road with a landscaped roundabout and a world-class architectural masterpiece,” Feldman said.
He said the center’s main business isn’t going to be giant events but corporate and association groups increasing its flexibility.
“We’ve created a lounge area that will be the kind of place where you can gather and meet your friends,” he said.
Redevelopment opponents say they’re close to having the necessary signatures to put the issue on the ballot in November.
However, there are concerns that if county commissioners commit the county to the funding proposal that it will render the petition moot.
Commissioner Dave Nelson is a longtime opponent of redevelopment and is supporting candidates Walt Nowosad and Mark Gardner. All three Republicans have filed for office. Larry Walsh is the only sitting commissioner who’s announced he will seek re-election. Walsh has been a supporter of the redevelopment area and funding the center, saying he believes its necessary for the county’s future prosperity.