Redevelopment not a sure thing
On Thursday, Douglas County commissioners are scheduled to discuss a $24.7 million redevelopment deal to build 30,000 square feet of retail space near Highway 395 and Topsy Lane.
The motivation for building the center is to spark construction of a larger retail area by bringing sewer, water and roads across the lots owned by Carson City auto dealers Michael Hohl and Dink Cryer. If the 100 acres owned by the two men is developed, it could create a new source for sales tax for Douglas County.
In a redevelopment district, property value for county tax purposes is frozen at the level when the district was formed. When someone builds on property in the district, the value goes up as do the taxes, but that money is rolled back into the district. The difference between the property value at the formation of the district and the increased property value is the source of funding for the redevelopment district. That money can go to individual property owners to renovate their businesses as was done in Carson City, or to attract a major project such as in South Lake Tahoe.
In Douglas County, redevelopment money on the west side of Highway 395 was used as an incentive to build Carson Valley Plaza and Clear Creek Plaza.
The deal is not without risk. According to an agreement proposed to develop 4.8 acres of land along Highway 395, no money is issued unless work is actually done on the property. But should developers build only the 30,000 square-foot retail space, the redevelopment district would still have to come up with the entire $24.7 million. The likelihood that the retail space will generate that much in sales tax is slim to none.
Redevelopment is a powerful tool and there are places in Douglas County that could benefit from it. We don’t agree the proposal at hand is worth the risk both to the county if it fails and to other Carson Valley businesses if it succeeds.