Visitors Authority asks county for $3M loan (2024)

ADELLA HARDING Elko Daily Correspondent

ELKO— Elko Convention and Visitors Authority is asking Elko County for a $3 million loan to help make its $6.06 million balloon payment for the conference center due in March 2026, which would the agency full ownership of the facility.

“I’m here to basically find out what the temperature or your appetite is for you to help us out,” ECVA Executive Director Annette Kerr said. “The key word is loaning. We will pay you back.”

She told Elko County commissioners on Wednesday the ECVA hopes the loan will have a very low or zero interest rate.

Commissioners voted Wednesday to send the loan request to the Elko County Budget Committee to crunch the numbers before coming back to the entire board for action. Commissioner Delmo Andreozzi, who is the commission's representative to the ECVA board and is on the county budget committee, proposed referring the loan question to the committee.

The budget committee is made up of Andreozzi and Commissioner Rex Steninger, Elko County Manager Amanda Osborne, County Comptroller Susan Paprocki and Jacey Molyneux, an accountant on the county staff. They meet at 1 p.m. April 24 and the visitors authority's loan request is on the agenda for that meeting.

Under the financing for construction of the $12 million conference center, built in 2016, ECVA makes yearly payments of $565,686 figured for a 25-year loan, but a balloon payment after 10 years would conclude the loan. ECVA must make the payment or face foreclosure.

Initially, ECVA put $3 million toward construction, so the financing was for nine years at 4.75% interest.

“If we can pay this off, the building is ours,” Kerr told commissioners.

Efforts to make the payment have been ongoing, with Elko City Council agreeing in 2022 to raise the lodging tax from 14% to 15% to provide extra money for the balloon payment. The first payment from the extra room tax came in February 2023, and Kerr said the annual amount is roughly $750,000.

ECVA also received a variance so more of its marketing committee money could go to the balloon fund. ECVA restricted 0.5% from marketing funds to the balloon payment.

Kerr estimates that with funds from room taxes, ad valorem taxes, the marketing fund, revenue that exceeds expenses and a $3 million loan from the county, the ECVA will have the $6.06 million balloon payment.

She said in her presentation the Elko Convention Center has been an important community asset since the ECVA was created through state legislative action in 1975, and the authority does more than just provide facilities for events, including helping fill hotels.

“We put heads in beds,” Kerr said.

Kerr said ECVA’s Elko Mining Expo sells out hotel and motel rooms in Elko, sending visitors to neighboring communities, and the convention facilities are 95% booked for every month through July. She also reported ECVA is updating its branding as the E Center, which is short for Elko, Events, Explore Everything and Everyone’s Center.

“We are the official visitors authority,” she said, reporting that economic impact from visitors to Elko County was an estimated $626 million in 2022, and “we helped bring that money to the community.” The figures come from the State of Nevada Travel Authority.

The COVID-19 pandemic, however, hurt the bottom line and slowed efforts to build savings toward the balloon payment, although ECVA is nearly back to pre-pandemic reservations and increasing revenues.

“No one could foresee the consequences and effects a pandemic would have on our very own community, including shutting down the entire hospitality industry,” she said in a letter to the county, and she told commissioners it was “very difficult to find” money for the loan payments during that time.

Commissioners Travis Gerber said the convention center is a “great facility,” and he praised Kerr’s efforts since taking over as executive director in 2022.

“We’re going to find a path forward,” he said.

When the city approved the penny increase in the room tax, the council chose the option that provides 2.375% of room tax revenue for ECVA, 1.25% to ECVA marketing, and 2.25% to ECVA’s facility fund, with 0.5% of marketing’s share going to the ECVA facility fund, Elko Daily Free Press reports show.

ECVA doesn’t receive all the room taxes collected, however, because there are also allocations to the city of Elko Recreation Fund, the Airport Alliance to keep SkyWest service in Elko, the recreation board, the Western Folklife Center, the Elko County Fair Board and to the state of Nevada.

The complicated financing for the conference center has been controversial, and Commissioner Jon Karr said the state has since enacted laws so that type of lease-loan “won’t happen again.”

Kerr said there was “a bit of wrist slapping” over the construction loan, but ECVA has been constantly working to cut costs and increase revenue to pay the loan off.

ECVA owns the land where the conference center is located next to the convention center, she also reported, which would complicate any foreclosure, if ECVA can’t make the balloon payment.