Discussions over the Grand Sierra Resort’s request for public funds to support its billion-dollar redevelopment project on Wednesday got off to a rocky start after Reno City Council member Jenny Brekhus accused city attorneys of collaborating with GSR’s legal team. That allegation sparking infighting among council members.
Before the presentation began, Brekhus said she was concerned about alleged impropriety, citing that City Attorney Karl Hall’s wife is the GSR’s legal counsel. Hall, however, had already recused himself from the project and handed it to Deputy City Attorney Jonathan Shipman.
Brekhus argued this wasn’t sufficient, stating that Shipman “serves at [Hall’s] pleasure” and claiming Hall had appointed Shipman after firing the previous deputy chief. Brekhus said the item should be postponed so the council could consider hiring independent legal counsel.
Mayor Hillary Schieve cautioned Brekhus about making accusations against city legal staff. Schieve then asked Shipman to clarify. Shipman assured the council that Hall had completely stepped away from the project, adding, “We’ve just totally segregated the information and created a wall so there’s no influence or conflict.”
Brekhus responded that the “wall” wasn’t strong enough. Schieve urged Brekhus to remain calm, prompting Brekhus to reply, “Thank you for helping me ‘calm down,’ Madam Mayor. I’m expressing a concern of conflict of interest and noting that I only learned about this major request 10 days ago.”
“TIF is generally used to channel funding toward improvements in distressed or underdeveloped areas where development would not otherwise occur.”
Schieve pointed out that the item had not been previously brought before the council and the presentation hadn’t even started. “I feel like we’re already coming in hot before we’ve even begun,” she said.
Project seeks $97 million in tax financing
The proposed GSR expansion includes a 10,500-seat arena for the University of Nevada Reno men’s basketball team to use, an ice-skating rink, retail spaces, a parking structure, driving range, new hotel rooms and 300 workforce housing units.
Revitalization Manager Bryan McArdle said that there was no agreement to approve yet; the item was being brought to the council to gauge interest.
The project is projected to generate $10 million in property taxes, 3,500 construction jobs and 65 jobs thereafter. The developer has requested tax increment financing (TIF) of around $97 million, approximately 10% of the project’s total cost.
“Tax Increment Finance is a mechanism for capturing the future tax benefits of real estate improvements, in order to pay for the present cost of those improvements,” according to the Council of Development Finance Agencies. “TIF is generally used to channel funding toward improvements in distressed or underdeveloped areas where development would not otherwise occur.”
Council concerns
Council member Kathleen Taylor questioned Andrew Diss, a GSR representative, about the casino’s prior assurances that the expansion would not seek public funds. Diss said this was a misunderstanding, explaining that they’d only committed not to seek funds from the university.
Schieve said that if the council pursued TIF, the project would first need to be completed and generate tax revenue before any funds were released.
Assistant City Manager Ashley Turney explained it as a “pay-as-you-go” approach, where the tax revenue generated by the project would fund the TIF with no current taxpayer funds being used.
Council member Devon Reese praised GSR as “an incredible community partner.” The GSR in about the past year has given $10,000 to Reese’s re-election campaign, $10,000 each to Council members Miguel Martinez and Kathleen Taylor and $5,000 to Council member Naomi Duerr.
Duerr drew parallels to a project on West Second Street that also sought substantial public funds but ultimately didn’t proceed. She requested an overview of TIF to understand potential city risks before moving forward.
Turney clarified that “financing” in this context is misleading because the city isn’t directly funding the project. In essence, TIF promises developers a portion of tax revenue generated by the project upon completion, which they can then show to investors as part of their funding plan.
McArdle outlined three funding options: direct cash payment from city funds (high-risk), city-issued bonds (also high-risk) and the pay-as-you-go TIF. He expressed support for the third option, where funds are only distributed once the project is complete and generating property tax.
Brekhus argued that TIFs should address blight, not support high-value private properties. The Council of Development Finance Agencies indicates that TIF is “generally used to address blight, promote neighborhood stability and inspire district-oriented development.”
Martinez asked if GSR would cover some administrative costs upfront to ensure city resources could be allocated effectively, to which Diss agreed. The council voted to move forward with a formal review, due diligence process and third-party feasibility analysis.
Reno Fire to handle airport emergency calls
The council approved an agreement between the Reno Fire Department and the Reno-Tahoe Airport Authority, which allows Reno Fire to take over emergency fire services at the airport. Reno Fire Chief Dave Cochran said this includes absorbing 24 airport fire personnel into the city’s workforce, ensuring seamless fire operations, fire prevention and dispatch for the airport and surrounding areas.
According to Cochran, the contract will improve response times by dispatching the closest resources automatically. The airport will cover all associated costs with no added financial burden on the city.
Council member Meghan Ebert inquired about training for lithium battery fires, as a lithium battery project is planned for the airport. Cochran confirmed that the department is aware of the risks and has secured a PFAS-free extinguishing agent to address such fires.
The contract is for five years, with an option for an additional five-year renewal.
Council hears update on airport expansion
Darren Griffin, CEO of the Reno-Tahoe Airport Authority, updated the council on the airport’s billion-dollar capital expansion. Projects include terminal upgrades, a new ground transportation center, an expanded ticketing hall and a hybrid electric utility plant aimed at reducing the airport’s carbon footprint.
Griffin said there was a nearly 10% increase in passenger numbers this year and ongoing efforts to expand service routes. A new 20-year master plan for the Stead Airport is also in development. The airport authority has committed 1% of its budget to public art installations, with current projects including a 450-foot art piece in the ticketing hall, Griffin added.
Correction: The number of jobs at the expansion following construction is 65, not 65,000 as originally reported. The incorrect number was a misstatement by city officials during the council meeting.
