Council members want Boyd land deal review

Dan Kulin

Friday, Feb. 4, 2005 | 9:03 a.m.

Now that they have been told the city paid almost $7 million for a 3.4-acre parcel of downtown land, some Las Vegas City Council members said Thursday they want to see a full review of the city's involvement in the property, which could cost Boyd Gaming Corp. just $2 million under proposed changes to an agreement the council is reviewing.

Also, Mayor Oscar Goodman and Boyd President Don Snyder met Thursday morning to discuss the matter, which on Wednesday the council decided to indefinitely delay action on. Goodman and a Boyd spokesman would not divulge the specifics of the discussion.

"We just want to make sure we are able to explain we are doing the right thing," he said.

Boyd officials say the deal is worth more than $2 million if one takes into account the $45 million the company spent to renovate the adjacent Main Street Station, which was bankrupt and closed when the company purchased it. They also say the amount of money Boyd would turn over to the city is capped at $2 million under the existing version of the agreement, which was approved by the council in 2002.

But some city officials are apparently not convinced that their hands are tied in this matter, and say they may want to negotiate a new deal, and at least investigate the history of the city's involvement with the land that is along Main Street and has the Ogden Avenue underpass running under it.

City Councilwoman Lois Tarkanian, who took office on Wednesday after winning a special recall election, said she has many questions about the land deals past and proposed.

"I want to see exactly what happened and when. All I know is I have lots of questions. It doesn't seem logical to me that you would buy land for $7 million and let someone hold onto it for 12 years ... it needs more investigation. I certainly wouldn't vote on that right now," she said.

Councilman Gary Reese said he would like the city to have the property appraised so the council can make sure they enter into a fair deal.

The city paid $6.97 million for the property in 1992, to close a court-challenged condemnation in which the city forced Union Pacific to sell the land for the construction of a "festival marketplace," according to records from the Clark County assessor's office.

Then in 1994 the city and Boyd entered into an agreement that called for the company to build a 900-space parking garage in return for getting the property next to the shuttered Main Street casino Boyd had recently purchased.

In 2002, the council changed the agreement so that instead of building a parking garage, the company could provide land for a proposed hockey arena plus a loan of up to $2 million; or, if an arena wasn't built, spend at least $1.5 million on plans for an arena plus give the city additional money to bring Boyd's total expense to $2 million.

The mayor and council members interviewed Thursday said they do not remember ever hearing what the city paid for the land when they were considering the 2002 agreement. They all said they had heard about the $6.97 million price tag within the past week.

"It was news to my ears," Councilman Michael Mack said, adding that he thinks the council should be briefed on the history of the land going back 20 years.

Mack and other council members were also sure to laud Boyd for its dedication to downtown over the years.

"Main Street Station was very good and they put so much money into it," Mack said. "We could have a ghost town downtown without them."

Goodman said the price the city paid for the land "was irrelevant earlier. We wanted an arena."

Following the 2002 agreement, which is still in effect, Boyd put $1.5 million into an account for the arena, which was called the Las Vegas Events Center, and then spent $320,000 of that money developing plans for the arena that was never built.

Under the latest proposed amendment to the agreement, the remaining event- center money plus another $500,000 from Boyd would be given to the city. Most of that $1.68 million would go toward a planned downtown performing arts center.

Boyd spokesman Rob Stillwell has said the latest proposal designates the money for a new project, but added that company officials believe that if they give the city another $500,000 they will have settled the existing agreement.

City Attorney Brad Jerbic has said that one could argue that the company would still be required to build the parking garage if they haven't spent more than $1.5 million on the arena project. 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.

Councilman Larry Brown said that ultimately the latest proposed agreement might be reworked.

Brown said he is particularly interested in making sure part of the property can be used for pedestrian access to the city-owned 61 acres, which is on the other side of the railroad tracks along the 3.4 acres.

"We can't put a big line of beautiful buildings separating the 61 acres from the rest of downtown," Brown said. "We need pedestrian access there."

City plans for the vacant 61 acres include the performing arts center, an academic medical center, and possibly a baseball stadium and new City Hall.

Brown also said that while the council should look at the history of that land when considering what to do now, he said that overall the city has also done some very smart deals downtown. For example, he said the city purchased the adjacent 61 acres for $2 million.

City Manager Doug Selby said that as a result of delaying a decision on the latest proposal on Wednesday "we are looking farther backward" into the history of the land. Selby referred all other questions to Jerbic, who did not return telephone messages Thursday.

Councilman Steve Wolfson, the other council member who was not on the board in 2002, refused to comment because he had not received a full briefing from city staff on the matter.