Reno event center: Who pays the bill?

When Sands chief executive Ferenc Szony walked into the Reno City Council Chambers on Tuesday, he said that a representative from the downtown casinos handed him a $20 bill.

“ ‘Here, that’s for your room tax fund,’ he told me,” Szony said. “But this is not a $20 issue for me.”

Szony asked the council Tuesday to exempt the Sands Regency Hotel Casino from a special assessment district in downtown. The district was created to raise money for the downtown events center. The district boundaries were set using the police district lines, but it might as well have been based on the city’s cleaning district, Szony said, for as much as it applies to the Sands. The arbitrary district was created and approved by groups that the Sands doesn’t belong to, doesn’t participate in. Unlike other downtown hotels like the Silver Legacy and Circus Circus, the Sands expects no benefit from the events center.

The Sands doesn’t do conventions. Most of his business, Szony said, comes by offering low-cost rooms through tour operators. And passing along another 1.5 percent in room taxes to tourists isn’t a sound competitive option. So, Szony said, the hotel-casino will be ponying up the extra money itself—about $87,000 a year, he predicted—to keep its prices competitive.

“We compete not with the downtown properties at all,” Szony said. “But with the Atlantis, the price leader in the market, and the Peppermill. I cannot pass those costs on, because my competitors are not adding it to their rates. I’ve got to absorb it.”

Another property owner, Roberta Ross, owner of Ross Manor, also asked that her hotel be removed from the assessment district since she does most of her business with weekly rentals to locals. The events center, she said, shouldn’t be financed on the backs of the working poor. All new tenants have to accrue 28 days worth of room taxes before they can be exempt from the tax. And if they happen to miss a day’s rent, the 28 days starts all over again.

But exempting any properties could endanger the whole plan, said Gary Bullis, head of the Reno Motel Association. The motel association’s 30 members voted unanimously in support of the downtown events center, he said.

“We’re in this together,” he said. “Everybody wants what’s best for downtown Reno. I’m afraid this is all going to unravel.”

Mayor Jeff Griffin seemed to agree, referring to exemptions as “opening Pandora’s Box.”

Szony approved of Reno’s efforts to diversify the market. But he also has a business to think about.

“As this whole ‘Pandora’s Box’ opens up, there’s a lot to be said for room tax parity,” Szony concluded.

Council members voted to continue the discussion at the Dec. 11 council meeting. In the meantime, city staff will study whether properties requesting exemptions could be expected to benefit from the center.