Taking those assets off Legends’ books will hopefully help the developer attract the financing to build an IMAX theater, according to city spokesman Adam Mayberry.
Legends is being developed in phases by RED Development.
“The art, the fountains, that is all public property and belongs to the city,” Mayberry said.
The Sparks Redevelopment Agency agreed to purchase the assets and help the Legends developer without a unanimous vote. Agency members Julia Ratti and Mike Carrigan voiced their opposition.
Ratti said that as the funding would do nothing to benefit an increasingly dormant downtown Victorian Square, she would not be voting for its approval. The vote also changed the city’s development agreement with RED, a move with which Ratti also disagreed.
The city now owns five of the six pylon signs that line Interstate 80, just before the Sparks Boulevard exit. It also owns fountains, some sidewalks and art.
According to Sparks community development director Neil Krutz, the assets were acquired at the developer’s cost.
“It is not putting money in their pockets, if you will,” he told the redevelopment agency prior to its vote. “There is no markup here.”
He added that RED will be responsible for maintaining the public features, per the agreement.
According to Nevada Revised Statutes, the agency had to make two findings in order to approve the bonds and acquire the property.
First, the agency had to agree that the move would benefit the redevelopment area. Second, they needed to agree that there were no other reasonable means of financing available to make those benefits a reality.
Both findings were included in the motion of approval, made by Councilman Ron Smith and seconded by Councilman Ron Schmitt.
According to Mayberry, the purchase wasn’t unlike what the city did in Victorian Square.
“The city entered into something similar in the downtown Victorian Square area,” Mayberry said. “We own the parking garage … and other (right of way).”
The Legends project has taken advantage of millions in city bonding. The dominant mechanism was Sales Tax Anticipated Revenue, or STAR, bonds. The Oct. 26 approved agreement leverages Tax Increment Financing, or TIF, bonds. Both mechanisms bank on future gains in taxes to finance current needs.
According to an Oct. 6 report by city finance director Tom Minton, the TIF bonds are based on actual assessed value; hence, they were considered a safer financing bet.
The Oct. 6 report also stated that the bonds would not “increase the city’s pledge of support to the project and will reduce any future TIF obligations of the city.”
“I believe it is important to move forward with these bonds,” city manager Shaun Carey told the redevelopment agency on Oct. 26. “It encourages growth and development for a project in which we have a great investment.”
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