Grand Sierra’s Alex Meruelo asking for Reno public money for sports arena after Phoenix failure

Alex Meruelo, the former owner of the Phoenix, Arizona Coyotes of the National Hockey League, who accepted one billion dollars from his fellow owners in order to relinquish his rights to the team during the off-season that just ended, is now trying to build a smaller, minor-league hockey, college basketball and multi-purpose arena in Reno. The proposed arena would be on property owned by Meruelo on the grounds of his popular Grand Sierra Resort and Casino.

Meruelo left his Phoenix operations behind, under a cloud of distrust and anger from Phoenix-area locals and civic leaders over his many unkept promises involving his former team and various failed arena projects. The Coyotes were subsequently sold and transferred by the league to Salt Lake City. The team began play this season as the Utah Hockey Club.

Meruelo appears to have a better relationship with northern Nevada officials, having enlisted the support of former federal judge and former Nevada Governor Brian Sandoval in the arena project. Sandoval, who is currently the President of University of Nevada, Reno (“UNR”), said the arena would eventually house the University of Nevada men's basketball team.

The developers of the Reno Arena project are now requesting public funding to help finance their arena project, a year after they first proposed a new arena that would not require public dollars. Compared to the initial proposal, which excluded taxpayer payments, it has completely changed. Its supporters are now requesting public funds to assist in the development of the $1 billion plan, which would include the arena as a major entertainment hub.

Preliminary designs for the 10,000-seat arena were for housing a minor league hockey club. Meruelo still owns the Tucson Roadrunners of hockey’s top minor league, the American Hockey League, and has stated that the team could be moved from Tucson to Reno. The Roadrunners presently have a working agreement for player development with the Utah Hockey Club which could conveniently continue with a move to Reno.

In the arena's endeavor to become a hub for the area's sports and entertainment scene, public funding has now taken on a particularly significant role.

The “tax increment financing” proposed is a means of encouraging the development of underperforming or economically distressed sections of the city. It serves as an incentive to promote private investment in otherwise stagnant parts of the city by transferring new property, sales, or other tax income to the project developers. In the case of the proposed Reno Arena, proponents think the project might lead to additional expansion, with better supporting infrastructure and long-term economic advantages.

This is supported by a study from the city government of Reno that outlines the expected benefits of the project. The project might improve the road system, increase tax revenue, and generate jobs.The Redevelopment Agency Board—which is composed of the seven members of Reno's City Council—is tasked with assessing the expenses and potential public benefits as part of deciding whether to proceed with the project.

While there is currently no deal on the table, and no approval yet, an upcoming vote allows the city to approve their staff to continue discussions with the Grand Sierra Resort to explore how this project would affect the city. The Grand Sierra Resort aims to begin construction on the arena in spring 2025, with plans to have it ready for UNR basketball by fall 2027, and the entire project expected to be completed by 2035. The application for the proposed tax increment financing plan requested $97 million, representing 9.7% of the total project cost of $1 billion. Officials commented that his amount “could be further negotiated in the final deal.”

Sources:

“Reno takes next step to possibly approve funds for GSR arena” , Sports Business Journal, October 24, 2024.

“Ex-Coyotes Owner Alex Meruelo Seeks Public Funding for Ambitious New Sports Project” , Daniel Lucente, bladeofsteel.com, October 23, 2024.