Sheriff supports leasing site for new headquarters

Leasing a site to house a new headquarters for the Metropolitan Police Department could cost as much as $15.5 million the first year, according to early estimates.

The sheriff and police officials argued this week that the cost is worth it. They contend putting departments and personnel under one roof would increase efficiency and, in turn, save taxpayers money in the long run.

Sheriff Doug Gillespie urged the Clark County Commission and the Las Vegas City Council this week to consider leasing a 370,000-square-foot complex that a developer, Project Alta LLC, would build at Martin Luther King Boulevard and Alta Drive.

"We are spread throughout the valley, making us inefficient," Gillespie said.

The county would pay 60 percent of the yearly costs, and the city would cover 40 percent. The county would have an option to buy after three years.

County and city leaders support centralizing Las Vegas police and dispensing with some of the 50 offices the department now leases.

But some questioned whether leasing the site was the best choice, and some criticized the developer's unwillingness to pay the prevailing wage to construction workers.

At a Tuesday meeting, Commissioner Chris Giunchigliani wanted to know why a lease was the only option presented. She argued that the county might be better off buying the 14.6 acres, given the drop in real estate prices, and building the complex.

Gillespie said the finance directors of the city and county told the development company that neither government wanted to buy the property.

Giunchigliani said that was news to her.

"That's nothing that has ever come to us as a board," she said. "We have an obligation to the taxpayers, as do you."

Giunchigliani said she was told months ago that the developer was unwilling to sell the land.

Gillespie said that all talks have been in the open.

"There's not going to be any secrets," Gillespie said. "That's not how I do business."

Commissioner Susan Brager said the county should lease no longer than three years before buying the property. Leases that run longer tend to waste money, she said.

At the commission's request, county staff will check options, including buying the land.

Las Vegas City Councilwoman Lois Tarkanian on Wednesday wanted to see a comparison between the proposed site and other locations. She also wanted information on how the lease compares with the estimated cost of the city and county building a new headquarters.

Councilman Steve Wolfson wanted assurance that the new building would meet the department's needs for many years to come.

"I'm concerned about the cost," he said. "But I think the location is excellent, and I encourage you to go forward."

The city aims to build a new city hall by 2011 and vacate the current 276,000-square-foot site. The Metropolitan Police Department now occupies 70,000 square feet of it.

Giunchigliani said the department should revisit the former sheriff's plan to house police in the vacated city hall.

But Gillespie said the department needs the 370,000 square feet in the proposed complex for growth.

"When we move in, it won't be full," Gillespie said. "The building will be able to sustain our growth needs."

Yearly leasing rates would be between $2.75 to $2.82 per square foot. The annual leasing cost for the site would be $12.2 million to $12.5 million, department spokesman John Loretto said. Also, the first year would have $3 million in tenant improvements.

After that, the city and county would bear an added cost of about $1.1 million yearly for maintenance and a 2 percent increase in the lease each year.

The department is paying a higher rate to cover 6.5 parking spots for every 1,000 feet, more than six times the number at most office buildings, Gillespie said.

The developer contends that Nevada's prevailing wage law for public-works projects would not apply because the company would be building the space for lease.

"That was not a condition," said Mark Fine, who represents the developer.

Commissioner Tom Collins disagreed, saying he would back the project only if the prevailing wage was honored.

"It's state law," Collins said.

Danny Thompson, executive secretary of the Nevada AFL-CIO, said his union and others want the law clarified to include lease-option projects.

"This has become such a problem statewide," he said. "Local governments are looking at ways to circumvent that law.

"We support the sheriff. We oppose these kinds of arrangements. If you're going to maintain a standard, if you're going to maintain a skilled work force ... you can't continue to circumvent prevailing wage laws."

Gillespie said an attorney general's opinion states that the lease-option project does not fit under prevailing wage guidelines, but he added that the developer is interested in using union labor.

Councilman Larry Brown said the lease agreement could specify that the developer must pay prevailing wages.

"You are a plum tenant," Brown said. "That should be part of the overall negotiations. The developer is building something that's needed, but the developer is getting a tenant that a lot of builders would like to have."

Contact reporter Scott Wyland at swyland@reviewjournal.com or 702-455-4519; and Alan Choate at achoate@reviewjournal.com or 702-229-6435