vin/020318.html
Once again, it has come to the attention of Mayor Oscar Goodman and the Las Vegas City Council that downtown Las Vegas is a dump.
Evincing their usual palpable shock at this recurrent discovery, the City Council unanimously authorized city staff on March 6 to research a modest proposal to selectively eliminate a requirement that liquor-serving establishments be kept at least 1,500 feet apart in the six block area sitting just to the east of the Fremont Street Experience, in hopes of encouraging the development of a new "entertainment district" there.
But while liquor would be permitted in the nightclubs and jazz bars now envisioned by these indefatigable central planners, gaming would not.
All plans for "reviving" downtown Las Vegas (not to be confused with the Las Vegas Strip - home to Caesars Palace and the Mirage and the Venetian and Mandalay Bay - which lies outside city limits in unincorporated Clark County and is doing fine) must contain the caveat "no gambling allowed," of course, lest they be delivered stillborn on grounds of "excessive competition" by the knife-wielding midwives who really run downtown Las Vegas -- the private casino trust currently owning and operating the tacky "Fremont Street Experience." (How you doing collecting those dues from Mrs. Behnen at the Horseshoe?)
The reason the area in question has become run-down is that most property owners there are absentee landlords, who have little incentive to take care of their buildings, explains Fremont Street Experience President Mark Paris.
But in fact, the blighted gateway to the "blighted zone" now drawing attention is formed (to the south) by the out-of-business Race Rock cafe into which the city poured more than $1 million in custom construction subsidies, and (to the north) by the vacant block which has been "soon to open" for years as the Neo-Necropolis "entertainment mall" -- a decade-old $90 million brilliant idea by the city's central planners which has sucked up $40 million in tax subsidies to date.
Let's take them one at a time, and see if Mr. Paris' diagnosis of "uncaring absentee owners" really explains what's gone down.
The $90 million darkened empty shell that sits to the north, sucking the life out of the downtown -- home of the permanently "soon to open" construction site dubbed Neo-Necropolis? "That's the site of the old Rancho Market" (a local grocery being one of the very facilities Mayor Goodman now says is needed to spark any measure of downtown re-gentrification), recalls Harry Pappas, whose own family property at Carson and the Strip was condemned and seized by the city years ago, driving out another handful of profitable, legal businesses.
"I met the owner, and he wasn't an absentee owner. He and his son worked there every day, where Neo-Flopolis now stands. Him and I spoke many times about this whole eminent domain thing and how they were coming after him next. There was a bunch of 'em that ran their own businesses, a lot of them. They were doing well, they were thrown out, and now they're just barely scraping by.
"One of them is a woman who's still down there, named Del Prado. They moved them into a new location and the city said they were going to do wonderful but in fact they're not. Mrs. Del Prado is now writing letters to the mayor, saying basically ' You misled me.' "
'Those small businesses ... are going to get screwed'
I called John Del Prado, whose family runs World Merchant Importers, forced to relocate to 310 Carson Ave. seven years ago by the original eminent domain property seizures along Fremont Street.
"We spent 10 years on Fremont Street, right underneath where they put the Race Rock, on the ground floor," Mr. Del Prado recalls. "When they first told us about the eminent domain, the city offered us $4,000 in moving expenses. But when we first went in there we'd spent $70,000 putting in fur lockers and alarm systems and display windows. ..."
The Del Prados retained property consultant Cliff Beck, "and he finally ended up getting us $170,000. We were in a position where we had to take it. We had a store full of merchandise; we didn't have a million dollars to open up somewhere else while we sued them, we had to take it to keep the doors open. So we signed off on it but there was an understanding that we'd be able to go back in (to Fremont Street) after all the new construction was done."
In all, 16 local, independently owned business were moved out of that block seven years ago, Del Prado recalls. Most are now gone for good.
"I'm not saying nothing needed to be done downtown, but they told us we'd be welcome to move back in when all the construction was over. ... We are not a T-shirt shop, we are a fine jewelry shop -- jewelry and porcelain and furs. We were told by Don Snyder who was running the Fremont Street Experience when Jan Jones was mayor that we were the kind of store they would (start ital)want(end ital) in the downtown area.
"They told us it was going to bring more people down here, profits were going to go up. None of that has happened. If I tell you business is half as good as it was before it would be an overstatement. And now they want to (expand city interventions further east); I've got a feeling they're just going to force more local small businesses out of business.
"The city has given millions of dollars to people who (start ital)have(end ital) millions, while we've been struggling. Times have been horrible, because we stayed in the downtown area like they recommended," Mr. Del Prado asserts.
"The city gave $1.2 million to that Race Rock to modify the building to their specs, and they're in there for what, eight months, and they're out of business? They told us (in 1995) that within eight months that would all be full. Well it's been seven years, and now they're telling folks that (Neonopolis) will be like an indoor mall, that they can get 8, 9, 10 dollars a square foot. There's no way that a small business that's not a multi-million dollar corporation can afford to go in there.
"There were originally three jewelry stores in that block, our rents were $1.20 a square foot and all three stores made money. ... I don't believe they have the small businessman, who's the backbone of any city, in their minds or in their hearts. ...
"A lot of folks who come downtown are looking for deals, looking for buys, and there's just no way that's going to happen with $10-a-foot rents," John Del Prado explains. "To have a fair mark-up, if you buy for a dollar you've got to sell for two dollars. If you jack the price up to 4, 5, 6 dollars to cover that kind of rent you're not going to have repeat clientele."
This may be key, because it pinpoints where Mayor Oscar Goodman's administration has not swept clean with a new broom. It's still moving ahead with the Jan Jones-era vision of Neonopolis and the Fremont Street Experience mimicking and rivaling the Caesars Forum Shops -- Louis Vuitton, Versace, Pierre Cardin, places that exist elsewhere to recapture the winnings of Strip high-rollers, and that can sustain $9-per-square-foot rents.
But that vision is mismatched with the actual clientele downtown, who tend to be low-rent locals or South Korean tour-bus groups looking for nickel machines, dollar hotdogs, and pawn-shop bargains. The high rollers have long since migrated to Mandalay Bay and Paris and The Venetian, to the south on the Las Vegas Strip, and they are not likely to return to the splendor of Jackie Gaughan's ancient El Cortez and the threadbare California Club.
Mr. Del Prado's mother, Elisa, has written to Mayor Goodman about the family's feeling of betrayal but has yet to be granted a face-to-face meeting, John Del Prado reports. "Those small businesses that are down there, when the city goes to do more expansion in the downtown area, they're going to get screwed just the way we got screwed.
"Next door to us was a clothing store. ... The owner was a New Yorker who had been in this town for 34 years. After they kicked him out he ... tried opening up at two other locations in this town," but failed to make a go of either, Del Prado recalls.
Was the problem in that case an "absentee landlord, who had little incentive to keep the place up," as Mr. Paris of the FSE suggests?
"He owned that business and he worked it from dawn to night," Mr. Del Prado responds. "The city screws the small business owner; Jan Jones and Don Snyder had one vision and that was to build that parking lot and to build that canopy and it didn't matter who they stepped on, who they crushed and who they killed to get it done. And the promises made were not kept. ...
"We were a little naive, thinking, 'Well this is our city, this is our mayor; she realizes that we're small businessmen.' Wrong. Everybody was expendable. It's not like in the military where you go back for your dead; the dead were left on the field."
'Tough luck, Andre'
The City Council now asks the "city staff" to explore ways to boost the nightclub business downtown. Would that be the same "city staff" that former Mayor Jan Jones sicced on Herb Pastor when he opened his "Topless Girls of Glitter Gulch" nightclub -- a Fremont Street attraction which Jones complained failed to fit in with the "family destination" image that she was trying to promote for her "new Las Vegas"?
Jones sicced the city building inspectors on Pastor mercilessly, making no bones about the fact they were under orders to "find violations, any violations," to prevent Mr. Pastor from proceeding with his completely legal plans.
Despite the city harassment, Mr. Pastor succeeded well enough to plow his profits into an even fancier topless joint, "Maiden Voyage" ... but he'd learned his lesson. He built it in -- and moved its jobs and tax revenues to -- New Orleans, not downtown Las Vegas.
Are the experiences of Herb Pastor and the Del Prado family unique, when it comes to determining how well "city staff" cooperate with entrepreneurs trying to invest in and build up the downtown?
Forget Bob Snow's Main Street Station, for once. (The way the previously successful Florida entrepreneur was driven out for daring to compete with the established downtown casino owners is worth an account all its own -- though an interview with Mr. Snow would surely cool the ardor of most investors considering a Las Vegas play.)
Instead, let's review what happened to the inoffensive Andre Rochat -- longtime proprietor of the swanky Andre's French Restaurant on South Sixth Street -- when he poured a million dollars into an attempt to upgrade the downtown tavern on Fourth Street formerly known as Down Under and subsequently P.K. Christy's, when he reopened it under the name Frogeez On 4th in 1997.
"There is no such a thing as redevelopment of downtown," says Mr. Rochat, a plainspoken Burgundian. "The few things happening is limited to a few people that are very well financially and politically connected.
"As for help from the city, you can forget it. Their attitude is basically 'You can die, sucker; it's your problem.' The building department tries to put you out of business before you even get started. Talking to the Las Vegas building department is like talking to the IRS."
Under five previous owners, the downtown tavern "never made it," Mr. Rochat explains. "We wanted to go in there and re-mold it, spend $250,000 and make it a nice place."
To play it safe before starting his renovations, Rochat requested courtesy inspections from the city building department, health department, and fire department. Only the health and fire departments cooperated.
"So they came in and said there were no big problems. They saw some equipment that was outdated that they asked us to replace, just some minor changes. But once we started remodeling, then everyone came down on me. Because of the code it turned out I had to re-do the whole place, everything. On the exhaust system alone I spent over $300,000. That exhaust fan that was there had been there for 18 years, it had been OK for everyone else before me, and the (courtesy) fire inspector never said anything to me about it. Then after we signed the lease I had to change everything.
"We went to three meetings at the building department. First meeting, I changed the plans, the plans were signed and approved. Then when we built it according to the plans, the building inspector came in and red-tagged everything. We told him the plans were approved and signed, and he said 'Well, I don't care.'
"We had to go to arbitration, everything was not good enough, everything had to be done with a special insulation. The fire department come back and said you need an alarm system. I said. 'Why do we need an alarm system?' They said, 'Well, your place is small enough you wouldn't need one, but because there was one there before, you need one now.'
"But they wouldn't tell me what kind of alarm system you need. 'We can't tell you.' I said 'Don't you have a code that tells people what kind they need?' They said 'No, just go out to bids and get one, and then we'll tell you if it's OK.'
"So I went and got bids, that took six weeks, then you have to re-do the plan and send it back, then you wait five more weeks. It goes on and on. ..."
"I covered that little patio that was a glass patio, I wanted to enclose it totally. They made me build a separate building, with steel that would hold up a city bus. That cost me $100,000. ...
"I just got my property tax bill last week," Rochat told me in July of 1998. "I pay $3,200 a year for the redevelopment of downtown in my property tax. What has the city done to me over the 19 years I've been here? They closed my street without giving me any warning. I got up one morning and the street was closed (for construction of the Fremont Street Experience); they said, 'Tough luck, Andre.'
"I ended up spending three-quarter-million dollars on Frogeez, and I'm gonna eat it, too," Rochat told me in that same July, 1998 interview, just before Frogeez closed for good.
"It's a beautiful place, they should be thanking us for what they did there, we put in a nice little retail bakery. But you know those people that drive around in their little carts writing parking tickets? They were giving parking tickets to my customers at 11 o'clock on a Friday night. There is absolutely nobody around, the downtown is empty except for my customers, and my customers were getting parking tickets. ...
"The city has put over $45 million in that Fremont Street Experience, but I couldn't advertise on it; it's owned by the big hotels. Everything is a game with the big people, end of story."
The 10 most scurrilous uses of eminent domain
"As soon as we get our property back, I'd like to put a strip club, a topless joint, in there," muses Harry Pappas, whose life is now devoted to fighting the eminent domain seizure of his family's downtown property which District Court Judge Don Chairez ruled was done in violation of the Redevelopment Agency's own rules. "I wonder how the mayor would stand on that? Then we'd really make it an entertainment center.
"But on a more serious note, I believe the casinos are opposed" to the newly proposed six-block entertainment district. "I don't think Goodman's going to get it on without using eminent domain. I don't think the property owners are going to go for it."
The decision to continue banning slot machines in the district is absurd, Mr. Pappas argues, given that gaming is the only known reason tourists come to downtown Vegas.
"Our property is zoned for unlimited gaming; that's another reason it's so valuable. Ban gaming? You talk to some of these bars in town and those video machines are their main revenue source, not the alcohol. That's how they stay in business, so if you can't do that kind of stuff ..."
The Pappas case wraps up the explanation of why businesses in downtown Las Vegas can't attract investment capital for upgrades, of course. Would you loan money to an enterprise whose property could be seized by the city -- "purchased" at a bargain-basement, "assessed-valuation" lump sum which you might not even receive for a decade if you decided to fight the land-grab in court -- as happened to Carol Pappas and Paul Moldon?
So when Mr. Paris says downtown property owners have "no incentive" to upgrade their properties, what someone needs to ask is who (start ital)removed(end ital) that incentive. The Pappases had maintained their downtown properties and paid the taxes on them -- figuring a property zoned for unlimited gaming at Carson Street and Las Vegas Boulevard would someday be worth a fortune -- since the days when John Pappas fed the guys building Boulder Dam out of his White Spot restaurant on Fremont Street, long before the current owners of any of the big Fremont Street casinos even moseyed into town.
But the Pappases are sure not maintaining the property anymore -- they're just watching the city stall and stall as the clock runs on the legal bills taxpayers will eventually have to pay to compensate them for the illegal seizure of their land and (now demolished) buildings.
The Washington-based Institute for Justice last week released a list of the 10 most scurrilous uses of eminent domain in recent American history -- and the seizure of the Pappas property in downtown Las Vegas made the nationally publicized list, along with a reference to the March, 2000 ruling of the Nevada Supreme Court, chiding the city attorneys in the case for their repeated "misleading filings." (See http://www.castlecoalition.org/top_10_abuses/.)
Downtown Las Vegas could attract a billion dollars in new investment capital, becoming the tourist mecca of the nation, within two years if the current city fathers showed the kind of vision that led a previous generation of Nevada leaders to re-legalize prostitution and casino gaming -- considered shockingly deviant pursuits, in their time.
This pale proposal to "allow" jazz clubs and honky-tonks within 1,500 feet of each other on east Fremont Street? It might have a chance, if it weren't going to be enforced by the current rent-seeking city inspectors, coupled with ongoing restrictions on offering any real competition to the downtown's current decaying card palaces beneath their pathetic steel awning -- competition even as minor as five video poker machines embedded in the bar.
Add to this the fact that the first time a few tourists (start ital)do(end ital) start to revel in ways that are commonplace on Bourbon Street, they're likely to be pepper-gassed and bludgeoned by dozens of Metro's finest, as we saw a few years back on New Year's Eve (the revelers had the nerve to hang around past 1 a.m.) ... and this proposal starts to look like one more energy-sucking black hole.
Fire the entire city inspection staff, legalize bordellos and hashish bars as Amsterdam has -- putting out a Request for Bids for the world's glitziest whorehouse/theme resort on the old Union Pacific property -- and downtown Las Vegas could indeed bloom, and boom, again.
Instead, we're supposed to seriously debate whether just anyone should be "allowed to open a bar" on Fremont Street.
Taverns and pool halls and beer, oh my. Sounds like big trouble in River City.
Vin Suprynowicz is assistant editorial page editor of the Las Vegas Review-Journal, a monthly contributor to "Shotgun News," and the author of "Send in the Waco Killers." For information on his monthly newsletter, "Privacy Alert," or on his new book, "The Ballad of Carl Drega," dial 775-348-8591; e-mail privacyalert@thespiritof76.com; or write 561 Keystone Ave., Suite 684, Reno, NV 89503.
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Vin Suprynowicz, vin@lvrj.com
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