Billionaire Alex Meruelo has obtained property tax rebates that he claims are essential for building a $435 million indoor sports arena at his Grand Sierra Resort in Reno.
As part of a $1 billion, multi-stage expansion and redevelopment of the Downtown Reno area, the Meruelo Group requested property tax incentives from the city in return for establishing a top-tier multiuse indoor sports venue in “The Biggest Little City in the World.” In addition to hosting significant concerts and events, Meruelo has promised to permit the 10,000-seat arena to serve as the home for the University of Nevada, Reno’s men’s basketball team.
Last week, the Reno Redevelopment Agency Board voted 5-2 in favor of a reduced Tax Increment Financing (TIF) proposal from Meruelo. The vote approved the city to refund as much as $61.29 million in property taxes to the Meruelo Group until 2035.
Brian Sandoval, the previous two-term Republican governor of Nevada who assumed the role of president at the University of Nevada, Reno, in October 2020, celebrated the taxpayer-supported tenure. Meruelo originally requested $97 million in city incentives.
"To be competitive in college sports, we have to have a venue and the ability to generate revenue. I’m not into competing — I’m into winning,” Sandoval said ahead of the Reno Redevelopment Agency Board vote. “The GSR project checks every single box.”
Since 2017, the Wolfpack men’s basketball team has made it to the NCAA Division I Men’s Basketball Tournament, also known as March Madness, five times, but they last advanced to the Sweet Sixteen in 2018.
Expansion of Grand Sierra Resort
The TIF agreement will support Meruelo in launching the Grand Sierra Resort Reno Arena and an additional $350.7 million investment to introduce an “aqua driving range,” an indoor community ice rink, and a 2,400-space parking garage at the resort casino.
To enhance his TIF application, Meruelo consented to transfer the property he rents to Fire Station 21 to the city and designate 5% of his property tax refunds for youth sports in the city. Meruelo mentioned that he listened to all community members and stakeholders, considering their various concerns.
“I’ve heard from every single one of you. It’s impacted me,” Meruelo said at the Redevelopment Agency meeting.
Competitors of Grand Sierra, such as Eldorado, Circus Circus, Silver Legacy, Peppermill, Atlantis, Boomtown, and Nugget, were against the TIF approval. The casino coalition expressed “serious concerns” regarding whether financing a private company constitutes an “acceptable use of TIF according to Nevada law.”
Nevada NRS Chapter 279 permits Tax Increment Financing for initiatives in a "blighted area" where the construction or development will aid "all residents and property owners" in the community.
No Financial Effect on City
Local officials stated that the property tax rebates apply solely to developments that wouldn't occur without the TIF, hence posing no financial risk to the city's budget. City Revitalization Manager Bryan McArdle clarified that Reno will just be reimbursing property tax funds to Meruelo until 2035, funds that the city wouldn’t have gathered if the TIF hadn’t initially been authorized.
Reno is in the process of revival. In addition to GSR, Jacobs Entertainment is still investing in the renovation of its J Resort and the Reno Neon Line. In March, it was announced that the former Harrah’s would be transformed into a mixed-use development.