Campagni gets city land near Toyota dealership in lieu of interest break
July 4, 2013
Property appraised at $415,000 goes from the city to Dick Campagni, a local auto dealer, under an incentive agreement altered by Carson City's Board of Supervisors on Wednesday.
The city purchased the property at 2443 S. Curry St. in 2008 to get right-of-way for widening Curry Street. Back then, before the downturn, it was appraised at $820,000 and purchased for $875,000. Public Works Director Andy Burnham said the idea was to resell the excess, but the market soon tanked.
The deal now with Campagni is in lieu of altering an agreement by lowering his interest rate on loans, from 5 percent to 3 percent, in an incentive package providing the city sales tax receipts from his dealerships and for him staying in Carson City rather moving to Douglas County at the time such deals originally were struck.
The deals were struck with Campagni's dealership group and the Michael Hohl dealerships, the two large multiple dealership firms in town. Hohl subsequently got his rate lowered to 3 percent, so the Campagni land transfer alternative was negotiated by city staff rather than providing an equivalent reduction.
The site involved is next to Campagni's Toyota dealership.
"Auto sales tax in this community has kept us alive," Mayor Bob Crowell said during discussion. He and other members of the Board of Supervisors said they weren't on the board at the time of the original deals. Supervisor John McKenna, though not a supervisor then, summed up the history and said the idea was to keep the dealerships and upgrade them.
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"Carson City helped them improve their businesses," he said. He said the city is in business with the dealerships, and mainly he sought reassurance the property wouldn't be sold by Campagni at a high price should economic recovery present that opportunity.
James Cavilia, Campagni's attorney, said he doubted the purpose was to spin the property and added Campagni must pay his obligations to city government anyway should he leave.
"If he goes away," he said, "he still owes you the money."
Supervisor Brad Bonkowski said he shared McKenna's concern and wasn't pleased there was no windfall recovery language in the deal presented. He also said if the October 2008 property appraisal been done a few weeks later, it likely would have been much lower because the banking crash subsequently dealt property nationwide a significant blow.
Randy Munn, chief deputy district attorney, helped negotiate the deal. He said it puts unproductive city land back into productive use and onto the tax rolls. After lengthy discussion, motions required were approved by the board without dissent.
On another matter, the board unanimously approved a plan to reorganize city government staff to re-establish the Community Development Department. It will be done by removing from Public Works the Office of Business Development (Redevelopment) and the divisions of Planning, Building, Business License and Code Enforcement.
The change also makes Planning Director Lee Plemel the community development director and his principal planner the planning manager. Deputy City Manager Marena Works said there would be no cost. She said there would be neither raises nor additional fees.
"This is strictly an organizational move that we want to make," she said.
Plemel agreed it would just change the person to whom he reports from Burnham to Works. McKenna asked if there would be any costs in Public Works resulting. Burnham assured him there wouldn't be from this change.