Supervisors lifted a freeze on redevelopment spending Thursday and agreed to fund the first project under the new guidelines.
DSE #4 LLC will get $53,520 for a $487,600 project converting a former four-room apartment building into an office.
Darci Casey of Casey Neilson & Associates said her accounting business will expand into the 3,000-square-foot building at 503 N. Division St. and rent the remaining office space. Casey is also the managing partner of DSE.
The city froze redevelopment spending in February so the business development office could adopt an incentive policy.
Applications under the approved policy should include a project description, site plans, business projections, financial statements and other information. The projects should create jobs, encourage new businesses and generate other positive effects in the area around it, according to the policy.
Applications also have to prove their projects will benefit the area and cannot be reasonably funded without city help.
Supervisors and residents argued over whether DSE showed it couldn't finish the project without city help.
DSE could get a loan for $53,520, but that would not allow the company to make "a reasonable rate of return" on the project, Casey told supervisors.
The company could probably then only do a basic renovation of the building in the downtown historic area, she said. Features like cobblestone walkways and decorative lighting would be gone, she said.
Pete Livermore, the one supervisor to vote against the incentive, said DSE did not provide the financial records to show why it needed the city's help. He said funding the project was the wrong way to start what should be an era of transparency for redevelopment.
"I don't know if it's our job to guarantee a reasonable rate of return," he said.
The city should also use a third-party professional to review financial statements instead of relying on the judgment of Business Development Director Joe McCarthy, he said.
Supervisor Robin Williamson said she was sorry for how poorly DSE was treated by opponents of the incentive. An applicant shouldn't have to be broke to get city help, she said.
"This is a wonderful project that will do great things for downtown," she said.
Jed Block of Carson City said he grew up across from the former apartment building and it has been a blight on downtown since he was a child.
The DSE project is a great example of how redevelopment can change the city, he said.
"Isn't it about being proud of heritage, our downtown?" he said.
But the incentive is wrong, especially in the slow economy, said Day Williams of Carson City. He said "it doesn't ring right" that the city is giving taxpayer money to someone who isn't struggling.
"There's no money going to Woodside Drive to get people out of poverty," he said.
In other city news:
- Supervisors agreed to pay a $30,000 settlement to a man who said he was brutalized by a jail deputy in 2006 after being arrested on a robbery charge. In a lawsuit filed in U.S. District Court in March 2008, Bret Court, 33, said that now-retired Jail Deputy Charles Farrell punched him in the nose and backhanded him across the face while Court was handcuffed to a chair. Court said he was denied medical attention.
- The city ended a $992,000 contract with Metcalf Builders to manage the construction of the city's new recreation center. The city has paid the builder about $34,000 of the contract since signing it in March 2008. Construction of the $10 million to $12 million building will have to be delayed for at least two years, Parks Director Roger Moellendorf said. The parks department doesn't have the money to build or operate the center because of the slow economy, he said.
- Susan Melvin plans to open Jimmy G's Cigar Bar downtown on June 1. Supervisors approved a full-bar liquor license for the 301 N. Carson St. business. Melvin said the business will be a high-end bar selling fine cigars, wine, scotch and martinis like her Jimmy G's bar in Minden.
- Sangeet Goel, owner of Arco AM/PM at 4190 S. Carson St., was fined $500 because his employees sold alcohol to minors twice within six months. All employees also must attended the city's alcohol server training class. Goel could lose his liquor license if an employee is cited a third time within six months for selling alcohol to minors.