Carson City close to deal with Hohl

The city will keep both of its major auto dealers in town for at least 20 years if supervisors approve the second of two multimillion-dollar agreements Thursday.

Michael Hohl would keep his three auto dealerships and RV center in Carson City under an agreement that would help him build a new location for his Honda and Subaru dealerships on South Carson Street. A $4.8-million incentive could be paid for through taxes raised from the new location, but, under the agreement, the city also could sell bonds to raise money.

This will allow the city to use $4.8 million that it had set aside for a deal with Hohl instead to help handle possible budget shortfalls over the next few years.

The city's other major auto dealer, Dick Campagni, will keep his three dealerships in Carson City for 20 years under a $3.6 million incentive agreement approved in November. It was designed to help him build a new location on South Carson Street for his Toyota-Scion dealership.

Auto sales have slumped in the city this year but still make up close to a third of sales taxes through about $200 million in annual sales. Supervisors decided in 2005 to try to reach agreements with the auto dealers because of the city's heavy reliance on sales taxes.

Hohl has to have his new location finished by summer 2011 and the money paid back by the end of 2028 under his agreement with the city. Along with paying the incentive, the city would also realign Snyder Street, make road improvements at Sonoma Street and put in traffic lights at the corner of South Carson and Sonoma streets and at South Carson and Snyder streets.

The agreement is a "win-win" because it helps Hohl generate more sales taxes for the city without putting city money at risk, said Joe McCarthy, city economic development manager.

"No money will change hands until he puts a spade in the ground and starts building the store," he said.

Mayor Marv Teixeira said he wishes the new location could be taken out of the south side redevelopment area that collects property taxes to fund redevelopment programs, but the agreement seems fair.

"Just so long as the deal's the same as what we gave to Campagni, I'll probably go along with it," he said.

The city had made a commitment to Hohl and it had to keep it, said Mayor-elect Bob Crowell, but the city needs to re-examine its redevelopment program.

Incentives for specific businesses should be avoided, he said, and redevelopment funds should be used for infrastructure like road, sidewalk and sign improvements that benefit everyone in the downtown and south side redevelopment areas.

- Contact reporter Dave Frank at dfrank@nevadaappeal.com or 881-1212.