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NEW LAS VEGAS CITY HALL PROJECT IN TROUBLE

Las Vegas’ plans for a new city hall have become more expensive and possibly unaffordable, Mayor Oscar Goodman said today, marking the second time in two days that one of his signature projects for revitalizing downtown has hit a snag.

“I’ve asked the city manager to have a manager’s review concerning the feasibility of city hall,” Goodman said at his weekly news conference. “Everything’s changed. It’s a new world.”


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  • He blamed skittish financial markets, saying the city originally planned on an interest rate of around 5 percent. As of Wednesday, it appeared the best the city could do was 7.5 percent.

    “That’s a difference of millions of dollars,” he said.

    On Wednesday, meanwhile, the Mob Museum project became embroiled in a dispute between two contractors bidding on one of the final phases of the project. The matter could head to litigation, tying up the museum’s opening for years.

    “I’m hoping we’ll be able to resolve that,” Goodman said.

    “I’m not around much longer,” he said, referring to the fact that this will be his last term as mayor because of term limits. “I’ve been the driving force, I guess. I hope it’s complete while I can still enjoy it in public office.”

    Recently, the city gained final approval to seek up to $267 million to finance the construction of a new city hall immediately west of the Regional Justice Center.

    The next step would be to seek bond financing for what’s known as a “lease-purchase” agreement in which investors put up the construction money and are paid back through annual appropriations by the city.

    It’s considered a riskier finance method than general obligation bonds because it’s not tied to a specific funding source. The project has always been controversial and the local Culinary union mounted an aggressive challenge to it, along with the city’s entire redevelopment plan for downtown areas.

    The city eventually overcame that challenge, which included two proposed ballot measures and two trips to the Nevada Supreme Court.

    But now Las Vegas has run into the reality of financial markets, said Chris Bohner, research director for Culinary Local 226. “I think the financial markets have a better understanding of risk than the City Council,” he said. “The financial markets have said, 'We don’t think your project’s feasible.’ ”

    He also noted that going over that $267 million limit would require the city to start the approval process all over again, something that could subject city leaders to more criticism.

    “In my view, they didn’t want to go back and go, 'Oh, not $267 million, now it’s $330 million,’ ” Bohner said, using a hypothetical number. “And this is not because of any labor or construction cost. This is financing cost.”

    The assessment of the city hall project is expected at the July 1 City Council meeting. The Mob Museum dispute is also expected to be on that agenda, since the bids at issue expire July 5.

    Both projects are tightly linked with Goodman’s push to redevelop downtown Las Vegas into something that has more to offer than the Fremont Street Experience, wedding chapels and government services.

    The city has touted several completed projects, including the World Market Center, the Chelsea Outlet Mall, the renovation of the Fifth Street School and the soon-to-be complete Lou Ruvo Brain Institute, as well as new bars and nightclubs at the corner of Fremont Street and Las Vegas Boulevard.

    The new city hall, especially, has been described as a catalyst that could jump-start the next wave of development. The new building at the corner of Main and Lewis streets would serve as an “anchor tenant” for three other office buildings proposed for adjoining blocks, all of which are owned by the developer, Forest City.

    Furthermore, upon completion of the new city hall, Forest City would trade the city hall parcel for a plot in Symphony Park upon which it would be required to build a new hotel-casino.

    The Mob Museum — aka the Las Vegas Museum of Organized Crime and Law Enforcement — is part of the planned redevelopment of the Lady Luck casino and adjoining land, a project that is also stalled.

    Bohner said the city wouldn’t give up on a new city hall.

    “I don’t think it’s dead,” he said. “I think they’re going to come back when the markets settle down.”

    When asked about the prospects for downtown development given this week’s developments, Goodman said only, “We have to make sure we’re doing the right thing ... I’m going to be a good mayor.”

    Contact reporter Alan Choate at achoate@reviewjournal.com or 702-229-6435.

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    KarenD wrote on June 18, 2009 08:51 PM: A "mob museum"??? You gotta be kiddin' me. Leave it to Oscar Goodman to do such a silly thing. Let's see! The unemployment rate is high. The economy stinks! And Oscar wants to build a new city hall? Maybe he could ask the "mob" to build it!!!!


    Chris wrote on June 18, 2009 08:25 PM: I have bad news for Oscar...if the market settles, rates will rise. So he if cant afford the debt now, he wont be able to afford it later. If Forest City wants to develop this deal so bad, make then provide limited recourse to the bonds which will reduce the credit risk and hence interst rate of the bond. If Forest City won't provide limited financial backstop to the project/bonds then they clearly have little faith in it... which say's a lot.


    Robert wrote on June 18, 2009 07:50 PM: "The city has touted several completed projects, including the World Market Center, the Chelsea Outlet Mall, the renovation of the Fifth Street School and the soon-to-be complete Lou Ruvo Brain Institute, as well as new bars and nightclubs at the corner of Fremont Street and Las Vegas Boulevard."

    Wow! So this is the new standard of success: not thriving, not profitable, not noteworthy. No success is now defined as "completed." Yes that is right. Our City Council no longer attempts to do anything right; it instead touts "Well we got it done." And in the case of Lou Ruvo, almost done is the handgrenade and horseshoe standard for success (please ignore overbudget, behind schedule and a construction catastrophe).

    Look the Taj MaOscar can wait until they can put Oscar's liver rather than his name on the cornerstone.

    (and to the thought police who want to subpoena--I am not calling for anybody forcably or violently doing anything to the Mayor or remove his organs against his will, just suggesting that the mark that the Mayor has left on the City of Las Vegas will be defined as much by his self-proclaimed bon vivant status as any reasoned political discourse).


    Oscar wrote on June 18, 2009 07:14 PM: The New City Hall, and the Performing Arts Project, and the Stadium project , and the Mob Museum project, and the wasting bucks to revitalize downtown bumville project, should be scrapped, and dumping hundreds of thousands of bucks on more palm trees for Casino Center Street, and Northern Las Vegas Blvd, and dumping hundreds of thousands of bucks on some dopey old Casino Signs revitalization project, and hundreds of thousands to millions of dollars redoing Freedom park, and Lorenzi park, and St. Louis street park at Eastern avenue. The Council says, "we're broke folks". "Are you willing to give up your raises, or your jobs, so we can continue to function as we have?". Empty high rise buildings with no hope of anyone spending the 400k to live in bums/hookers/pimps infested Downtown Vegas. People with money aren't stupid. And Tax Payers are growing tired of wasteful city council fantasy spending, as though they had a full-time Rainy Day fund. You can't make a silk purse out of a sow's ear. Please stop wasting millions of OUR TAX dollars on YOUR failing pet projects. Enough millions of dollars have already been spent on existing City hall. The stupid Plexiglas art, that had to be removed, cause it was falling off the building. The stupid fountain, that leaked into the basement, and eventually had to be removed. The additions, and Employee Parking Garage walkway. And the park across the street. Which was nothing more than Eye candy for city hall offices. That too is gone. It was infested with bums, and had to be eliminated. How about the bum infested park on Maryland Parkway, south of Charleston, that is CLOSED to the public? It is still being maintained as a park, but is permanently closed. ENOUGH ALREADY.


    Sonny Corleone wrote on June 18, 2009 06:31 PM: It has nuthin' to do with the economy, bambino. Oscar couldn't give the unions the deal they wanted so the bosses started making all of 'em offers they couldn't refuse, eh? The word is nobody gets nuthin'.
    And this Miller kid's got a point too, eh? It's all about Goodman's ego. They're not really short on space. They could even move into Neonflopolis if they had to.


    Former LV Councilman Steve Miller wrote on June 18, 2009 06:01 PM: It's about time! This was the most wasteful and foolish idea ever proposed by a local public official. The present city hall is about to gain thousands of square feet of additional space when Metro vacates. And no one mentions the blight an empty former city hall will create in an already troubled area of downtown. The only reason for a new city hall is so Oscar Goodman can get his name on the cornerstone. He's insanely jealous every time he passes the present city hall's cornerstone and sees former Mayor Bill Briare's name instead of his.


    the new mormon temple is not going to be built ???? wrote on June 18, 2009 06:00 PM:
    i guess it will be delayed is all.

    til the very costly clean up is done atleast.


    Former LV Councilman Steve Miller wrote on June 18, 2009 05:59 PM: It's about time! This was the most wasteful and foolish idea ever proposed by a local public official. The present city hall is about to gain thousands of square feet of additional space when Metro vacates. And no one mentions the blight an empty former city hall will create in an already troubled area of downtown. The only reason for a new city hall is so Oscar Goodman can get his name on the cornerstone. He's insanely jealous every time he passes the present city hall's cornerstone and sees former Mayor Bill Briare's name instead of his.


    Former LV Councilman Steve Miller wrote on June 18, 2009 05:57 PM: Good riddance! This was the most wasteful and foolish idea ever proposed by a local public official. The present city hall is very adaquate, and is about to gain thousands of square feet of additional space when Metro vacates. And no one mentions the blight an empty former city hall will create in an already troubled area of downtown. The only reason for a new city hall is so Oscar Goodman can get his name on the cornerstone. He's insanely jealous every time he passes the present city hall's cornerstone and sees former Mayor Bill Briare's name instead of his.


    ET wrote on June 18, 2009 05:46 PM: Watch him he's trying to decoy us,Oscar we do not want a New City Hall,or a Mob Museum.Maybe a Howard Hughes Museum or a homeless shelter.


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