Updated May 13, 2019 - 8:26 am
The Las Vegas Convention and Visitors Authority has recommended moving forward with a $10 million police substation expansion in the middle of a criminal investigation of the tourism agency.
An item seeking approval to launch the project appears on the agenda of Tuesday’s LVCVA board meeting.
In materials attached to the agenda, the LVCVA says it has included $10 million in public funds for the substation expansion in its proposed fiscal 2020 budget. The two-story substation sits on convention authority property at Swenson Street and Sierra Vista Drive.
Legal experts have questioned whether proceeding with the project during the investigation creates a conflict of interest for the LVCVA and the Metropolitan Police Department. For the past 10 months, police have been looking at alleged misuse and theft of Southwest Airlines gift cards bought by the authority.
The Review-Journal reported in March that Rossi Ralenkotter, the LVCVA’s former CEO, pushed for the substation expansion last year after he became a target of the investigation over his use of $17,000 in gift cards for personal travel. Ralenkotter paid back the money and denied criminal wrongdoing.
While at the helm, Ralenkotter arranged a meeting with Sheriff Joe Lombardo to discuss the project, and he participated in the meeting with other LVCVA officials after he retired and began consulting for the convention authority, records showed.
The project, which is expected to entail the addition of 10,200 square feet to the substation and remodeling of 5,600 square feet, is needed to help accommodate more Metro officers on the Strip, according to the LVCVA. The Legislature approved the use of a sales tax hike in 2016 to fund more than 300 new officers.
If board members approve the expansion plan, the convention authority will begin the process of selecting a company to oversee design and construction. The board will eventually have to approve the $10 million in funding.
Ralenkotter told the Review-Journal in March that he did not consider the ethical ramifications of meeting with the sheriff during the police investigation. Lombardo would not comment.
Steve Hill, who succeeded Ralenkotter, threw his support behind the substation expansion in March.
“Since taking over as CEO in 2018, I have had the opportunity to evaluate the project, and I am confident that it is an essential investment for the continued safety of our visitors and residents alike,” Hill said in a statement.
He said Ralenkotter attended the October meeting with Lombardo because of his “historical knowledge” of the expansion project.
Hill declined further comment last week.
The convention authority built the police substation in 2008 for $17 million and then leased it to police to help protect the resort corridor along the Strip.
Less than a week after a Review-Journal story on the Lombardo meeting appeared in the newspaper, intelligence detectives executed search warrants at the LVCVA offices, seizing emails and other electronic records related to the Southwest Airlines gift cards. Police also arrested Brig Lawson, the convention authority’s former director of business partnerships, on a felony theft charge. He was released on bond.
Police say Lawson hid the purchase of $90,000 in gift cards between 2012 and 2017 in a series of promotions the agency sponsored for Southwest. Lawson also controlled distribution of the cards, and his longtime partner used the cards to buy more than $9,000 in Southwest tickets.
Detectives placed Lawson at the center of an alleged conspiracy to steal the gift cards. Through his lawyers, he has denied wrongdoing.
On April 30, a judge gave prosecutors four more months to file a criminal complaint against Lawson.
Cathy Tull, the former chief marketing officer for the convention authority, resigned last month after police disclosed that she had used $6,000 in gift cards to purchase Southwest tickets for her family. Tull paid back the money before she stepped down.
The Review-Journal is owned by the family of Las Vegas Sands Corp. Chairman and CEO Sheldon Adelson. Las Vegas Sands Corp. operates the Sands Expo & Convention Center, which competes with the LVCVA-operated Las Vegas Convention Center.