A proposal downtown Las Vegas boosters view as a no-brainer still faces plenty of skepticism in the Legislature and even at City Hall.
At issue is Assembly Bill 50, which would tack 15 years onto the life span of the city’s downtown redevelopment agency. The Legislature approved creating the agency in 1985. It’s scheduled to expire in 2031 and AB50 would extend it to 2046.
Backers say the bill, which found no purchase during the 2011 legislative session, is important because it would allow the agency to improve its financial situation by refinancing long-term debt.
The money freed up by such a move would make it easier for the agency to continue programs that pay downtown businesses to spruce up facades or reimburse them for costs associated with making old buildings code-compliant.
“We have got to have it,” Councilman Bob Coffin said Friday after a work session on the bill held in Carson City and Las Vegas via videoconference. “If we can’t help the urban core then we are in deep trouble.”
Coffin was one of several people who testified in support of the proposal in front of the Assembly Government Affairs Committee.
But Assemblywoman Teresa Benitez-Thompson, D-Reno, who leads the committee, seemed skeptical of the proposal.
“Are redevelopment districts perpetual?” she asked Las Vegas officials. “You started it in 1986. The original idea was it would last 45 years (until 2031). One would think after 45 years you would be at the point to see if it worked our not.”
City official Bill Arent agreed that “45 years would have been enough,” but he added the recession caused a dramatic drop in property values and prevented the full positive effect of redevelopment from being realized.
Benitez-Thompson then questioned whether payments on redevelopment building loans could be made if another recession occurs between now and the potential end of the district in 2046.
“How are you going to make debt service payments?” she asked. “If our economy backslides, where is your ability to pay that debt off? We know other cities are facing that.”
Mark Vincent, a city financial officer, said Las Vegas lost 60 percent of revenue due to the real estate slide, but continued to pay off redevelopment debts without having to raid the general fund.
In addition to tough questions from Carson City, there is skepticism about the bill at home in Las Vegas, too.
Councilman Bob Beers questions whether government-sponsored redevelopment, which essentially means capturing a portion of property tax within an area and diverting it into programs aimed at improving the area, is working as intended.
Beers said the downtown revival in Las Vegas could owe more to the elimination of regulations and fees that made it difficult to open bars on Fremont Street and the decision of online retailer Zappos CEO Tony Hsieh to spend $350 million of his own money on property, small businesses and other quality-of-life investments than it does to redevelopment.
Beers also said he’s not so sure extending the life span of the redevelopment agency would be a good fiscal move.
With property values falling in recent years, revenue has fallen from $28.2 million in 2010 to $13.1 million in 2012, he said, without a corresponding decrease in debt.
That threatens to make the agency a riskier bet for any bank that might consider handling a debt refinancing, he said.
“I’m not so sure a lender would look at that and be terribly interested in making us a great deal,” Beers said.
— Benjamin Spillman and Ed Vogel
Assembly Government Affairs Chairwoman Teresa Benitez-Thompson is about to have a baby and is clearly interested in eating.
During a Friday hearing, after a bunch of goodies were delivered to her hearing room, she told fellow legislators that they could help themselves to the pastries, and added the people in the audience could help themselves, too.
“Maybe it will sweeten you up,” she said jokingly.
That gesture is almost unheard of in the Legislature.
Average folks in hearing rooms aren’t even offered coffee in early morning meetings, coffee that is readily available for legislators. For her gesture, Benitez-Thompson clearly was the sweetest legislator of the day.
— Ed Vogel