County approves funding plan for performing arts center

By Jeff Pope

Thursday, March 19, 2009 | midnight

Clark County Commissioners paved the way this week to begin building the Smith Center for the Performing Arts by approving a plan by the city of Las Vegas to fund part of the estimated $245 million construction cost.

The city has agreed to provide $170 million of the cost through issuing bonds. Of that, $105 million will be backed by the city's portion of the car rental taxes it receives from the McCarran Rent-A-Car Center.

The commissioners' approval of the city's plan is required under a state law that allows the two governments to use the 2-percent county-levied tax on car rentals specifically to build the arts center.

In approving the city's debt plan on Tuesday, the commissioners voiced their support for trying to energize the economy through government-funded projects.

"This is one of the gems that I think will bring tourists to Las Vegas in a way that we have not seen in a long, long time," Commissioner Chris Giunchigliani said.

The Donald W. Reynolds Foundation has provided $150 million in grants to the Smith Center, including the remaining $75 million for construction.

With another $50 million in donated funds, the Smith Center now has all the money it needs to build and operate the future home of the Las Vegas Philharmonic and the Nevada Ballet Theatre for the first year, said Don Snyder, chairman of the center's board.

"We wanted to know that all the money is in place before we break ground and this funding is obviously an important part of that," he said. "We've done everything we can to feel comfortable that this is a fiscally-sound project."

The city received about $8 million from the car rental tax last year and $7.3 million in 2007.

As Director of the Department of Aviation, Randall Walker oversees McCarran International Airport and the rental facility. He said the 2008 numbers overall were surprising but the revenue dipped toward the end of the year. Rental companies project revenues to be down 30 percent this year, he said.

"I would anticipate through this calendar year and the next calender year ... 25 to 30 percent reduction as being a conservative approach," he said.

If the tax revenue is less than estimated, the city will make up the difference in repayment of bonds from its general fund, said Mark Vincent, acting deputy city manager.

The car rental tax revenue likely will grow when the economy rebounds and the city considers the arts center as the anchor of its 61-acre Union Park project, he said.

"There's always a risk. Anytime we go to market with debt in good times or bad, there's risk," Vincent said. "In this particular case, this is the city's most important project."

When completed, the center will have three performance spaces the largest being a 2,050-seat hall. The theater will be able to host first-run Broadway shows and other touring attractions, orchestra, opera and dance performances.

Construction is planned to begin this spring with an opening date in late 2011, said Myron Martin, the center's president.

"What a great time to put people to work and build something for generations to come," he said. "Thank goodness we've been working on this as long as we have. If we were just starting to raise money now, it would be tough."