City paid $7 million for land in Boyd proposal

Dan Kulin

Thursday, Feb. 3, 2005 | 10:58 a.m.

The Las Vegas City Council on Wednesday indefinitely postponed acting on proposed changes to an 11-year-old downtown land deal with Boyd Gaming Corp. after council members were apparently told the city paid almost $7 million for the 3.4 acres that, under the proposed new agreement, would essentially go to Boyd at a cost of $2 million.

Boyd spokesman Rob Stillwell said the deal is worth much more than $2 million to the city because one must also take into account the $45 million the company spent renovating the adjacent Main Street Station, which was bankrupt and closed when Boyd bought it.

Stillwell also said the $2 million is already part of the existing agreement, and so the deal cannot be changed to cost the company more money.

But some council members said that in light of the high price the city paid for the land, the council must take another look at the proposed changes to the agreement, and Councilman Gary Reese said they should consider changing the proposed new deal.

"We need to look at restructuring the deal," Reese said. "Let's find out what the property appraises for and go from there. I think the deal needs to be refigured."

Councilman Lawrence Weekly wouldn't say whether he thinks the proposed deal needs to be reworked, but said he was confident the city and Boyd will reach an agreement "that in the end will be a win-win for everybody."

Weekly and Reese both said Boyd has been a good partner in downtown development.

"They stayed when a lot of other folks didn't have a lot of confidence in downtown," Weekly said.

Councilman Michael Mack also would not say whether the council could or should try to change the deal, but said he was glad it hadn't been approved yet.

"We have to protect the taxpayers' interest at all times," Mack said. "I'm just glad it wasn't rushed, and now I think we have to evaluate it."

According to records from the Clark County assessor's office, the city paid $6.97 million for the land in November 1992 under a court order that ended a contested city condemnation purchase of the land from Union Pacific.

David Pierce, the office services supervisor in the assessor's office, confirmed that the city paid $6.97 million for the 3.4 acres.

Then in early 1994, the city and Boyd entered into an agreement in which the city gave Boyd the T-shaped property that straddles the Ogden Avenue underpass next to Boyd's Main Street Station. And in return Boyd was required to build a 900-space parking garage on the site.

Since then the agreement was amended five times to give Boyd more time to build the parking garage, which was never built.

In 2002, the agreement was changed again to give Boyd the option of providing land across Main Street from its casino for a hockey arena and loaning $2 million toward the project, instead of building the parking garage.

That 2002 agreement also said that if Boyd spent more than $1.5 million on plans for the arena, which was called the Las Vegas Events Center, but the arena didn't come to fruition then the company could give $500,000 more to the city and be relieved of the original requirement for a parking garage.

Boyd put $1.5 million into a special account for the events center, and so far, Boyd has spent $320,000 on plans for the arena that also never happened.

Under the latest proposed amendment, the remaining event center money plus another $500,000 from Boyd would be given to the city. Of that total $1.68 million, $1.18 million would be designated for a planned performing arts center, and the 11-year-old deal would be closed.

Boyd's Stillwell said that while the latest proposed agreement would put the money toward a new project, "technically if we drop off the $500,000 we're done."

City Attorney Brad Jerbic has said that if Boyd has spent less than $1.5 million on the project, one could argue that the company would still be required to build the parking garage. The latest agreement gives Boyd until the end of this year to build a parking garage, although no one in City Hall says one is still needed there.

Boyd officials have also said looking only at the $2 million is not looking at the whole picture.

Company President Don Snyder has said the 3.4 acres was part of his company's deal for Main Street Station, which he said cost $16 million to purchase and then another $45 million to fix up and open.

The latest proposed changes to the Boyd-city land deal were originally scheduled for a council vote two weeks ago, but were taken off that agenda too. At that time, city officials said they wanted to wait until Mayor Oscar Goodman returned from a conference in Washington, D.C., to consider the new agreement.

Jerbic said he asked for the proposed amendment to the agreement to be taken off the Wednesday council meeting agenda "to study it and review it more."

He said he did not know when the matter might be brought back to the council.

Goodman said Wednesday he was going to study the agreement further and promised the matter would be worked out.

"We're not going to court," Goodman said.

Councilman Larry Brown said taking extra time to review the proposed changes to the agreement is wise.

"We just think we have to get a fair and legal deal. Nothing is harmed by waiting to get more information," Brown said.

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