Reno attorney Garrett Gordon, representing Jacobs Entertainment, on Wednesday provided the mandatory one-year review of Jacobs’ development agreement to the Reno City Council.
The 20-year agreement was approved by council members on Oct. 27, 2021, for the development of the proposed “Neon Line District,” a term coined and trademarked by Jacobs Entertainment. The paperwork wasn’t recorded with the county until November 2022, giving the company two years to report on any movement on items in the agreement.
The majority of Jacobs’ phase one goals have not been completed. Some of their efforts—such as plans to install two 25-foot-tall LED signs—have been blocked in court. The court determined the signs were not placemaking signs but new billboards, which Reno residents voted to ban in 2000.
Scenic Nevada, historian Alicia Barber and Council member Meghan Ebert have all pointed out that the “Neon Line District” is not a city-designated district but rather a marketing effort by Jacobs Entertainment to brand its properties between Keystone Avenue and West Street east to west, and Interstate 80 and Second Street north to south.
Building for Jacobs properties has been limited. The J Resort and Arlington Apartments are under construction. According to Gordon, Jacobs has put $300 million into the rebranding and renovating J Resort, formerly the Sands Regency. Gordon said they also invested $20 million to expand the Glow Plaza Festival Grounds.
Council member Kathleen Taylor asked about the company’s 10-year plan since the public was very concerned about plans in the “district.” Gordon said a full plan will be announced “in the next year.”
Gordon added that housing is at the top of their list of projects within the district. “I think you’re going to be pretty excited to hear about the relationships we’ve built, as well as some of the buildings we’ve been working on.”
Council member Devon Reese said that many people feel left out of the project and asked Gordon how everyone can move forward together.
Gordon repeated some of the same talking points Jacobs representatives have been using for several years, including the company’s positive opinions about the relocation of numerous families after their Jacobs-owned motel housing was demolished.
He said that when Jacobs Entertainment took control of multiple motel properties, they were in a “horrific” condition with black mold, cockroaches and general disrepair. He added that Jacobs stopped requiring tenants to pay rent since they “did not feel they could collect a rent check from people living in those conditions” and installed security at the properties.
“Every single vulnerable person who needed a better living situation was relocated … on Jacobs’ dime,” Gordon said.
However, this contradicts a report published by ProPublica in 2021 contending that several former tenants at the demolished motels ended up living in their cars, on the banks of the Truckee River, or in other “similarly decrepit” motel rooms.
This Is Reno in 2017 found nearly a dozen residents who were evicted by a property owner after Jacobs purchased the property. The company stepped in to halt the evictions, but residents were unaware that the company was offering relocation assistance until it was reported by This Is Reno. A representative of Jacobs Entertainment said at the time that it was never the company’s intention to displace the residents.
Many local opponents of Jacobs Entertainment’s development of the west downtown area cite that Jacobs initially talked about providing affordable workforce housing. They say they don’t believe that Jacobs has any intention of following through on that plan.
“I think you’re going to be pretty excited to hear about the relationships we’ve built.”– Garrett Gordon, Jacobs Enterainment’s attorney
A tentative map for 63 condominium units was submitted in October 2021, which was later withdrawn in January 2022 when the project was instead converted to apartments. In June 2022, a building permit for a five-story multifamily building of 60 units was submitted.
Gordon said they would still like to keep 10% of the units as senior affordable housing “in the mix,” and Jacobs Entertainment has “had their eye on” the Bonanza for years. That property, Gordon said, will be used for workforce/affordable housing.
Council member Jenny Brekhus—who has been critical of Jacobs’ plans—said that while Jacobs Entertainment says they have received no taxpayer money for the project, she believes they have received “tremendous special privileges and rights that are not given to others.”
“No, they haven’t,” Mayor Hillary Schieve cut in.
Jacobs Entertainment has received additional privileges from the city, such as extensions on sewer connection fees, more so than for other developments. In most cases, developers have five years to use their sewer connection fee credits. However the city, in its development agreement with Jacobs Entertainment, extended the timeline. The company must use 35% of its credits in the first five years, another 30% by the 10-year mark and another 20% by the 15-year mark. The final 15% of sewer connection fee credits have the full 20 years of the agreement to be used.
Council members in May 2021 approved a change to the Reno Municipal Code to allow for sewer connection fee credit extensions for longer than five years in development agreements, specifically to provide Jacobs Entertainment extra leeway. The staff report from that council meeting notes, “Other Developers have inquired about extending the life of their credits beyond five years.”
“I see a continuation of this council not focusing on the very minimal standards that are even there,” Brekhus said.
Reese said the city had no role in Jacobs Entertainment’s purchase of private property. However, City Manager Doug Thornley did attempt to set up meetings between himself, Jacobs Entertainment representatives and property owners of nearby businesses who had declined to sell their properties to Jacobs. Public records obtained by This Is Reno also reveal city staffers being especially accomodating to Jacobs and its representatives.
“I don’t want to continue re-litigating the past,” Reese said. “My interest is really what will go and be there in the future. We’re talking about an area of Reno that had a tremendous amount of blight and issues that we inherited, and this council has an obligation to engage thoughtfully on how that area will be developed. We all have to remain engaged.”
Reese said Jacobs Entertainment’s investments in the district are “historic,” which will encourage other investors to focus on Reno
“I think we should all be rooting for and be skeptical of promises that are made and promises that are not kept,” Reese said. “The narrative we’ve given away special privileges is not true. Disregarding reality is not where this body wants to be.”
Taylor said that as the only council member who lives downtown, she is grateful for what she sees as positive changes in downtown thanks to Jacobs Entertainment’s investment into the area.
“I see the buildings coming up, I see the investments starting, I’m super excited about what’s coming online, and I’m excited to be a part of downtown,” Taylor said.
Schieve spoke at length about how many in the community may be against Jacobs Entertainment. She said she feels the company has cleaned up an area that she saw as a blight that took advantage of people and was fraught with crime.
“I know the rhetoric is anti-Jacobs and very popular, but where was the outcry from the public when all those people were being taken advantage of?” Schieve asked. “Children being sex trafficked, drugs being pushed onto people, 30-year-old bedding with massive bedbugs. I couldn’t even take a reporter in there, and she knows who she is, and she didn’t report on that because there were so many bed bugs in there. It was horrific conditions, horrific … It was not OK to let people live in those conditions.
“So where is the outcry for the people who were charging $300 a week for 200 square feet, no running water … was that OK?” Schieve asked. “That’s $1,200 a month—that’s not affordable housing. Can you imagine the children that had to live in there like that? Where was the outcry for the people who owned those properties?”
Opponents of Jacobs Entertainment’s development plans, who have spoken multiple times during public comment at city meetings, have argued that it’s not an either/or situation. Commenters say the city is responsible for requiring developers to provide affordable housing and ensure property owners provide liveable conditions through fines and code enforcement.
Opponents of the Neon Line District say Jacobs Entertainment is displacing low-income individuals for their economic gains—with a red stamp from the city. Jacobs Entertainment provided no other information on the potential to create workforce affordable housing at the Bonanza.
Correction: This story has been updated to correct details on sewer fee connection credits Jacobs Entertainment has received, which are valid for years longer than for other developers.
