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Sports Complex Assumptions Questioned
Posting Date: 11/28/2011

Michael McGreer

Mesquite City Councilman Kraig Hafen was correct in questioning the assumption that building a covered sports complex would guarantee an increase in business and thus an increase in taxes. “Mesquite is back to where we were three or four years ago,” he pointed out during the Tuesday, Nov. 22 City Council meeting at City Hall.

Michael Parda, Mesquite representative for Nevada Community Solutions (NCS), agreed with Councilman Hafen's concerns. Parda pointed to the investment challenges facing the private sector and the need for a market. "It will take time, significant time, to attract significant new investors,” he said.

The general idea behind an air-conditioned, covered sports complex is based upon the assumption that more visitors would be attracted to Mesquite in the summer time and they would stay and dine in local establishments, primarily the casinos. Therefore, both demand for services and tax revenues would increase.

These assumptions are inconsistent with a recent Brookings report suggesting that, in Nevada, “Gaming will play a diminished role in the future Nevada economy, and the housing and tourism boom that preceded the recession is not likely to be repeated to previous peaks until the later part of the 2010s,” i.e. 2016-2019.

The Brookings report also suggests that, "Job growth will likely remain anemic, while unemployment rates will remain stubbornly high, perhaps through the entire decade."

Nonetheless, the city staff, and the majority of the Council, with support of the Chamber of Commerce, voted to move into the design/build phase for a covered sports complex. Possibly, the council and other supporters will re-think their positions when they have an opportunity to closely review the funding.

The estimated $5 million dollar construction costs (plus or minus) would come from different sources. The modifications and execution of Joint Development Agreements would ostensibly yield $1.5 million. The remaining $3.5 million would

come from redevelopment (RDA) bonds and property taxes earmarked for RDA activities.

Before any of these funds are invested, it is necessary to be reasonably convinced that the investment, with interest, can be returned in a reasonable time to both the investors and the city. No such reasonable assurance exists at present.

Part of any economic strategy is to conduct a cost-benefit analysis of a reasonable number of investment alternatives before making an investment choice. One of those alternatives would be to do nothing and therefore earn interest on existing funds. Of course this assumes that current JDA funds, bonds, and property taxes are reasonably invested.

Other indoor sports alternatives would consider the use of existing facilities that could easily be converted to sports use, or other investment choices that would create high-paying, long-term jobs.

The most obvious alternatives for generating high-paying, long-term jobs, involve renewable, sustainable resources that would, as Ken Rock, General Manager of the Virgin Valley Water District, recently pointed out: “put Mesquite on the map as a green, vibrant community that would attract home buyers and businesses."

No such alternatives were considered.

Any planning for a future requires some concept of what a small dynamic city wants to be when it grows up. Generally, such a vision is expressed in mission statements tied to measurable goals and objectives. These do not exist in any cohesive methodology.

When establishing a future, it's important to set the community apart from other similar communities. Such diversification is built upon layers of both environmental and economic diversity based upon healthy community values as established by the people.

Michael M. McGreer, Ph.D. retired government service in 2006. He currently writes on public policy in several venues and is CEO of InterWorld Publishing at: http://www.iwpinc.net. He is a frequent Yahoo contributor at: http://contributor.yahoo.com/user/217735/michael_manford_mcgreer.html

Follow him on his blog at: http://mmcgreer.blogspot.com/

On Facebook at http://www.facebook.com/michaelmcgreer?ref=profile

On twitter at https://twitter.com/#!/mmcgreer or @mmcgreer

 

Commentary
  • Posted Date: 11/28/2011
    Businesses should survive on free-market economics, NOT taxpayer exploitation schemes facilitated by "Robin Hood" city government. The potentially negative effect of the proposed Arizona freeway toll should also be considered.
    By: -
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  • Posted Date: 11/28/2011
    Congratulations Michael, you are right on!!! The city of Mesquite should not be in the speculation/ development business. They should be providing the infrastructure for the speculating developer to access their development, not investing the peoples money on pie in the sky speculation, without firm commitments from the potential users of the facilities. A question was asked at a pre election meeting of the candidates for City council, “What comes first, people or business” It was surprising that only two answered that people should come first. We need to focus on bringing the people to Mesquite first then the speculator’s will follow. Lets go green by making the streets of Mesquite more friendly for golf carts in designated lanes, that can also be shared with bicycles and scooters for the disabled. This would help people and they would not have to rely on their cars, it would also triple the available parking spaces for the businesses
    By: Douglas
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  • Posted Date: 11/28/2011
    Absolutely right Mike. This city should not be in the speculation business -couldn't have said it better. I am very disappointed in Litman for caving in. We would have expected it from Karl and Geno but not Litman. Make this a "green" city proud of its senior and a great golf, gambling, and a city that has jobs, jobs, jobs. Get out of the ripoff business promoted by the former mayor.
    By: Robert
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