City to keep campus green: Contested acreage removed from college plan

Jeffrey Libby

Thursday, March 29, 2001 | 11:36 a.m.

As Henderson city officials move forward with plans to build the proposed state college in an industrial park, they are quietly removing from the deal a 35-acre parcel that has cost city taxpayers $3.6 million in botched land deals over the past four years.

The parcel is instead being talked about for use as a buffer planted with trees at city expense.

As recently as last week, city officials said they planned to transfer to the state an 85-acre industrial park located about 1 1/2 miles west of Railroad Pass for the state college. But this week they said they will likely keep close to half of Wagon Wheel Industrial Park under city ownership.

Vicki Taylor, spokeswoman for the city, said Tuesday that trees on the 35 acres could screen the college from a neighboring plastics plant and recreation vehicle park. The trash bag manufacturing plant, yet to be built, is planned at 400,000 square feet with a half-dozen 75-foot high resin silos overlooking U.S. 95.

The 40-acre RV park, currently under construction, will have 396 sites with full-service hook-ups when completed.

But by creating a 35-acre grove of city-owned trees, the city would be left with little opportunity to develop the land it has invested in most heavily, all but sealing losses sustained through the 1990s while trying to get the industrial park off the ground.

At the same time, the state would be allowed to purchase only the cheapest land in the park.

According to city charter, the city must sell or transfer land for an amount at least equal to what it paid.

The net effect of keeping the 35 acres in city ownership would be a savings of about $6 million for the state system of higher education. The land is bordered by Dawson Road on the west and the Union Pacific railroad to the north.

In 1970, the city bought the 85-acre parcel from the Bureau of Land Management for $4,675 or $55 an acre.

Since that time, the city has invested about $8.5 million in the land.

Of that total, the city spent $2.5 million building roads, laying sewer lines and making other improvements.

The city spent the other $6 million buying back land and a new building at inflated prices to settle a lawsuit in one case and the threat of a lawsuit in another.

In March 1998, the city paid vitamin manufacturer Andrew Lessman $2.7 million to buy back a 1.6-acre parcel it had sold to him less than two years before for $111,000.

In the roughly 18 months Lessman owned the property, he built a 28,207 square-foot vitamin manufacturing plant and warehouse.

Today, the going rate for similar properties is roughly $50 a square foot, according to Diedre McGraw-Felgar, president of the Greater Las Vegas Association of Realtors.

But the city paid $2.6 million for the two-story concrete building, or roughly $92 a square foot.

After paying close to double the value of the vitamin plant, the city also paid to relocate Lessman's business to a new location on Parkson Road.

The settlement was reached out of court with the Las Vegas law firm Lionel, Sawyer and Collins. Lessman's attorneys argued successfully that the city made a verbal agreement with him in 1996 that gave him first refusal on several of the acres now being considered as a buffer for the college.

In November 1997, however, the city sold developer Doris Keating 20 acres of that land for $1.2 million to build a movie studio. That sale sparked Lessman's legal challenge.

But the land deal with Keating soured, too. After a lawsuit settled unconfirmed accusations on both sides, the city agreed to pay Keating $3.2 million to buy back the undeveloped land in June 2000.

In a span of roughly five years, the city invested at least $6 million to buy a building worth about $1.1 million and to buy land it originally purchased for less than $5,000.

The city has since invested more money remodeling the vitamin plant to expand office space for city employees housed there. The parking lot has also been expanded.

But as a city building, it creates no tax revenue to help pay for such strapped municipal services as fire and police. Nor does it help diversify the economy, as former Mayor Robert Groesbeck had hoped when he helped open the industrial park seven years ago. As a state college building, as has been proposed, it would also remain off tax rolls.

The Henderson City Council is expected to approve preliminary site plans by April 10.

The university system Board of Regents will also have to OK the plans at its April 19 meeting. Those plans then go before state legislators. Public hearings with the nearby Mission Hill residents have yet to be scheduled. Classes for the college, which would be about two miles southeast of the community college campus, are tentatively scheduled to start in 2002.

Taylor and other city officials declined on Tuesday to confirm whether the city would attempt to obtain a fair exchange on its investment. Depending on the interpretation of the city charter, the 50 acres, along with the vitamin building, could be sold to the state for as little $2,750.

That interpretation will come from City Attorney Shauna Hughes, who oversaw settlements with both failed developments in the industrial park.