If the City is going to approve the GSR Arena TIF deal May 7, then they should request this as part of the deal

by Mike Van Houten / May 2, 2025

Wil​l TIF for the GSR Arena Help - or Hollow Out - Downtown Reno?

The Grand Sierra Resort was never a stranger to grand, lofty concepts and ideas. Do you recall in 2007 when they proposed two 48-story tall residential towers on their property? 

One of the benefits to approaching my 20-year anniversary of this web site, is I have a nice history of fun, wild projects that never came to fruition. There was also the grand plan shortly after to build the nation's largest indoor water park, a Nikki-Beach pool experience, and conversion of the top 11 floors of the existing 27 story building into 824 condo hotel units, along with improving the golf experience on their lake. 

But alas, much like the shimmering Kobi Karp towers, these plans fell apart. 

GSR eventually did make incredible improvements to their property, renovating nearly everything on site, a new pool, remodeled rooms, remodeled casino, updated theater, amenities and so forth. It is one of the nicer properties in Reno, and it's understandable why their theater captures so many class acts. 

So cut to today, and the GSR is proposing a brand new arena, parking garage structure and ice skating rink, along with some associated venues like restaurants and bars and a fan zone area, to complement the new arena. They are asking for tax increment financing to help fill a $145 million funding gap, due partially to increased construction cost projections due to tariffs, raw material costs and the like. The EXTRA property tax that's produced as a result of this being constructed, would revert back to the developer (90% of it per one of the deal options presented), while the Redevelopment Agency retains a portion of it (10% per one of the deal options). Or in another proposed scenario, 100% would go to the developer.

Either way, if the project wasn't built, the property tax would never have been generated in the first place. This is why I don't have a problem with the financing mechanism itself. What I have an issue with is what it will do to downtown, more specifically the city-owned facilities downtown, and that I feel there isn't enough of a public/community benefit baked into this agreement. And no, the stadium simply existing is not a good enough public benefit in my opinion, nor are the union construction jobs it would create. 

What the deal looks like

• 90 % of new property tax from the arena complex flows back to GSR through 2035.
• The Agency keeps 10 % ($6.8 M) for other projects in RDA2 (click for map).
• Hunden Partners forecasts 553,900 annual attendees and a 4.5 % IRR “but for” test. The But For test is essentially a non-binding identifier that states, but for TIF financing, this project could not be built. 

Downtown Impact Assessment

Issue - Event displacement

What the GSR TIF does - 95 events/yr projected; Hunden assumes 553 k annual attendees.
Likely Downtown effect - Loss of 17 Wolf Pack games + mid-size concerts & family shows currently suited to the 7,000-seat Reno Events Center; downtown/UNR neighborhood foot traffic drops on up to ±40 nights/yr. We are talking about moving potentially 150,000+ attendees per season, off the UNR campus and away from neighboring businesses that rely on those attendees, like the Wall, and Archies, and Laughing Planet, etc. 

Issue - Tax capture shift

What the GSR TIF does - Increment generated only inside the GSR district; none from downtown lodging/parking/retail.
Likely Downtown effect - No new room tax or sales tax growth for the Events Center debt funds; slower pay down of existing bonds.

Issue: Marketing gravity

What the GSR TIF does - Arena is integrated with GSR casino, hotel and “Aqua Golf.”
Likely Downtown Effect - Visitor spend is captured on site, reducing spill over to Riverwalk/MidTown restaurants or hotels.

Bottom line: The project adds a modern 10 k seat venue to the region but, in its current form, largely re slices the entertainment pie rather than enlarging it - while we are still retiring tens of millions in bonds on the Downtown Events Center and Reno Ballroom via tourism-based tax income. 

What did it cost to build the Reno Events Center and Ballroom? 

Reno Events Center (7,000 seat) Jan 2005 Facility Opening Original public cost -  - Roughly $28–30 M build out of 56 k ft² exhibition hall & seating bowl
Funding device - The Events Center’s $28‑to‑30 million construction tab was not paid with property taxes. Instead, Reno pledged two special room‑tax streams created for tourism projects. Those cash‑flows support senior “Special Event Center” bonds; a second 2013 series that also leans on room‑tax is backed, if ever needed, by a slice of the City’s sales‑tax–based CTAX distribution. Because the taxes are dedicated and collected county‑wide (or in the downtown hotel district), the bonds are classed as self‑supporting revenue bonds, keeping the City’s general fund and ad‑valorem taxpayers off the hook

Reno Ballroom Facility Opening Original public cost -  The Downtown Reno Ballroom (52‑54 k ft²) was built in 2007‑08 for roughly $18‑19 million (source).
Funding Device - Reno Ballroom’s $18‑19 million price tag was folded into the same tourism‑bond program that paid for the Reno Events Center, supplemented by a dedicated tranche of ReTRAC lease‑revenue bonds. Both debts are repaid from visitor‑driven income streams (room‑tax and railroad‑property leases) rather than property‑tax. (source - source)

Summary

So you can see why diverting tourism dollars away from downtown's publicly-owned facilities by using TIF financing to help fund an arena over a mile from our downtown core, can pose some issues for publicly owned facilities downtown that are supposed to rely on tourism dollars to pay down the bonds. I'm not against the GSR project entirely, I just want the community to benefit a bit more than simply the arena existing

Ideas/Community add-ons to the deal to offset the displacement

1. Mitigation ideas for the Redevelopment Agency

Downtown event quota - Require GSR to co book 10–12 dates/yr at the Reno Events Center/Ballroom (e.g., women’s hoops tourney, graduations, mid tier concerts).
Shared ticket fee - Add a $2 “Downtown Venue Preservation Fee” on every paid arena ticket; proceeds retire REC/Ballroom bonds faster.
Shuttle & parking reciprocity - Mandate a free game day shuttle loop (GSR ↔ Riverwalk ↔ MidTown) plus honoring arena tickets in City parking garages. This would be much better than UNR students and downtowners who might normally walk to UNR games at Lawlor, to instead drive after drinking at the games. 
10% (or more) TIF carve out for core assets - Earmark the Agency’s 10% share or higher (≈ $6.8 M through 2035) for capital upgrades in the DOWNTOWN-ONLY portions of RDA2 (see map, pink areas)
Community benefit fund - Annual GSR contribution (~$500 k) to downtown arts, small venue grants and special event programming for the life of the Tax Increment Financing.
Housing Component - Since the RDA2 doesn't look like it will have its life extended, the housing component of this deal dropped off, in the final presentation from Hunden Partners to the RAAB board. I would like to see the Redevelopment Agency Board ask for a Development Agreement that hols GSR to breaking ground on their proposed workforce housing component by a certain date, or else the amount of TIF financing they get in reinbursed drastically falls off. 

2.  How UNR can offset the shift of men’s basketball

Downtown practice pavilion - Partner with the City/RSCVA to convert under utilized REC back of house space into a Wolf Pack practice floor open to youth clinics 100+ days/yr.
College town activations - Commit to pep rallies, e sports tourneys, Pack women’s games & volleyball at the Ballroom and REC to keep student presence downtown.
Research & innovation hub - Expand the University’s “Innevation Center” footprint on ESinclair; Tenant improvement grants?
Transit pass & shuttle sponsorship - UNR funds free Sierra Spirit bus or micro transit linking campus – MidTown – Riverwalk on event nights.

Question the numbers 

And lastly, question the numbers, even if they come from an expert (Hunden Partners) that was hired by the Redevelopment Agency. Again, this is where having a 20-year history reporting comes in handy. Let's look at Greater Nevada Field (then Reno Aces Ballpark). 

Back then, the Revelopment Agency hired Meridian to do the analysis for the Ballpark. 

2007 projection (SK Baseball/Meridian) - 600,000 annual turn stile attendance across 72 Aces games + 30 non baseball events
Outcome - Averaged ~425 k paid attendance pre COVID; non baseball use far lower than projected.

2007 projection (SK Baseball/Meridian) - $1 B “25 year economic impact” via sales, room tax and job creation.
Outcome - Later independent reviews put realized impact at < 40 % of forecast. In fact the outcome was so bad (for the developer) that the developer came back to the Reno City Council/Redevelopment Agency and demanded a deal renegotiation that guaranteed him money, or else he'd pull the Reno Aces out of Reno entirely. 

The original deal that was negotiated with SK Baseball was actually great. It involved: $2 million per year of the incremental property tax (above current levels) from a newly created "baseball district" for 20 years, car rental tax money (about $25M) if the deal was completed by a certain date, and loaned the City of Reno $10 million to relocate the fire station off the ballpark property prior to construction. There were also some land swap deals for a private party that owned some parcels the ballpark sits on, in exchange for RDA-owned and city-owned property elsewhere. 

However, after an unprecedented economic collapse and the baseball district wasn't built out as envisioned, the developers approached the Council in 2012 to come up with another deal. From those negotiations emerged a $30 million settlement agreement that will be paid off using the city's general fund. "Those payments equal $850,000 a year until 2018. They then jump to $1.2 million a year for five years and then drop to $1 million a year until 2043." - RGJ

So, deals can go sour, no one can predict what the economy will do in the next ten years. I would just love for the Redevelopment Agency Board, GSR and UNR to consider some of these community benefits I outlined, if they are going to approve the GSR arena. 

 

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