City Center Project: Feasibility study delayed
A feasibility study for the downtown’s City Center Project will not be completed in time for P3 Development to present it to the city’s advisory committee Monday. A project update is planned instead.
“P3 will outline where we’re at today in terms of facilities, sizes, costs and revenue streams,” City Manager Larry Werner said Thursday, “but it will just be more of a status update to let the committee know what issues we’re facing. We will come back with the study, but it will be at least another month.”
One issue, Werner said, is the use of Redevelopment Authority funds.
“Can we really use these the way we originally thought we could? We’ve got legal and financial folks on that right now,” he said.
“We’re also applying for (federal) Economic Development Authority grants. We’re filling out those apps right now. That could amount to up to $2.5 million, so we need to know how that can fit into the equation,” Werner said.
In a Monday memo to the City Center Project Citizens Advisory Committee, Werner wrote, “There will not be a specific draft plan until we’ve reviewed and resolved the issues regarding items such as IRS rules on public/private financing, redevelopment concerns such as the remaining life of the redevelopment area and possible restrictions on using funds between redevelopment project areas, lease/purchase and land ownership.”
Mike Courtney, project manager and president of P3 Development, had planned initially to present a feasibility study to the 14-member citizen’s committee at the end of July, but because some of the property appraisals weren’t available, the presentation was moved to Aug. 30, then most recently changed to Sept. 27.
A 10-member workgroup which meets at least every Monday at City Hall has been hammering out the details for all the buildings being considered for the project, and trying to determine how to package the financial elements of the intricate project, Werner said.
Meanwhile, Steve Neighbors, president of the Carson Nugget and trustee of the Hop and Mae Adams Foundation, met with EDA officials in Idaho Thursday, “to see what the feds could bring to the table,” he said.
“We are dead on target for the kind of projects they’re looking for,” Neighbors said. “They get billions of dollars of requests, but they really like public/private partnerships involving foundations and businesses – or someone with a financial interest.”
Neighbors said Nevada gets back less federal money than any other state.
“We pay into it (with income taxes), but we don’t get much back. We do not embrace the system. We haven’t figured out how to get our share back,” he said.
The challenge for P3, he said, is the stipulation imposed upon them to entirely fund the project so that the city will not be at risk.
“They’ll pay what they can, but if there’s a gap, then all of us need to decide how we can step up to the plate,” he said.
The public portion of the project includes a transportation hub as well as infrastructure, but the key component is a new library, or what is being called a Knowledge and Discovery Center with a business incubator and digital media lab.
How to fund the library and who owns the land have become sources for division within the community, but Neighbors said the city only stands to benefit from the proposal.
“As long as the community wants a library, it can be anywhere on our property and they can use it. Any funds we get back from the developer in the interest from the lease of the land goes directly back into the (Adams) Foundation and then directly back to the Library Foundation,” he said.
“We’ve said the city cannot go into debt, so P3 has to borrow the money. The city will enter a lease/purchase option with P3. We want the city to own the building when it’s done being paid for,” he said.
The use and any value derived from the property is being donated back to the library to make funds perpetually available for obtaining grants to keep it state-of-the-art.
“We use the gain to perpetuate the assets to the public side,” he said.
Feasibility study pace
“Some people say we’re moving too fast, and some say we’re moving too slow,” he said.
The need for speed is three-fold, Neighbors said, even if attention to detail is critical. He cited:
• A lot of people are out of work right now, and the project promises to bring hundreds of short-term jobs to residents.
• Interest rates are at an all-time low. Every 1 percent is equal to about $3 million.
• Construction costs are also at an all-time low.
The challenge right now, Neighbors said, is to be thorough and quick without being reckless.