I-Team: Sweet Restaurant Deal Being Scrutinized - 8 News NOW

Investigative Reporter George Knapp and Photojournalist Matt Adams

I-Team: Sweet Restaurant Deal Being Scrutinized

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Historians and environmentalists have praised the Las Vegas Springs Preserve as a wonderful community asset. But the facility, built and operated by the Southern Nevada Water Authority, has proven to be extremely expensive, in part because of questionable deals.

Celebrity chef Wolfgang Puck with a string of gourmet restaurants, a frozen food line, his own kitchen gear, and other products, is a one-man conglomerate, but chances are the multimillionaire epicure has never seen a deal as good as this one.

It's the 10 year contract he signed to run a cafe and catering operation at the Las Vegas Springs Preserve. The salads and sandwiches are predictably pricey, especially for families. Business has been slow. Most of the customers seem to be water authority employees, as if its their own celebrity lunchroom.

"My kids wouldn't want to eat at Wolfgang Pucks. They want McDonalds, Burger King, chicken nuggets, pizza, hot dogs, not a chef salad with salmon," said Steve Sisolak, Clark County commissioner.

The more Sisolak learns about the Puck deal, the less he likes it. The Clark County commissioner thinks the contract is symbolic of what's wrong with the water authority -- it treats public money like personal funds.

About $4 million in public dollars has poured into Puck's place, so far. The chef didn't have to pay for a single pot or pan. The public pays for the kitchen equipment, the electric bill, cleaning expenses, and money for the chef totaled $613,000 last year. If Wolfgang breaks a plate, the public pays to replace it. While you might think other restaurateurs would kill to have a kitchen that can't lose money. Not so, say water officials.

"At the time we went out with requests for proposals on that cafe, there were only two respondents. We put some strenuous requirements on that cafe, requirements on organic materials and recyclable products," said Pat Mulroy, SWNA general manager.

Mulroy also admits, they wanted a name to help draw people to the preserve. So far, both Puck's and the preserve are flops. The only way the public will get a piece of the profits is if puck rakes in $1 million or more dollars in a year, not likely to happen anytime soon.

Sisolak says he's angriest of all about the 15% dining discount given to water employees, because it means the public is not only subsidizing puck but also gourmet lunches for water workers.

"We are subsidizing their discount to eat. Totally unreasonable," said Sisolak.

But the bigger picture is even more bleak. Springs preserve is an ambitious enclave designed to educate locals and tourists about Las Vegas history and the realities of living in a desert. It cost more than $250 million dollars to build. Water officials predicted it would draw 600,000 people though less than 200,000 visitors came last year, and less than half of those were paying customers.

Las Vegas Springs Preserve Attendance

In response to I-Team inquiries, SNWA revealed that last year it had to subsidize the operation an additional $12 million. Sisolak has discovered the true cost is even higher.

"The capital subsidy is $8 to $11 million a year, which means ratepayers are subsidizing $17 to $20 million a year, $21 million," he said.

Las Vegas Springs Preserve Expenses

At a time when vital services are being cut, he says that amount is simply unacceptable. {at Mulroy says there is always going to be financial support for the preserve because of its ongoing mission of education. She compares it to how other cities pay to support museums, adding that visitor estimates were off partly because of the economy.

"It wasn't built for tourists. It was built for the local community," she said. Mulroy agreed that the visitor predictions didn't hold true for last year. "Absolutely they didn't, just like the predictions in every hotel in Southern Nevada didn't hold true."

"Some could be blamed on the economy but even if you doubled the visitor volume, it's still less than a third of what they anticipated," Sisolak said.

Critics of SNWA spending say the Las Vegas Springs Preserve is emblematic of the kind of unchecked spending the water agency has been known for in recent years. They find it ironic that the central theme of the preserve is sustainability.

(Wolfgang Puck Deal analyzed by Jim Nagourney, a former Long Beach, NY city manager and long time consultant.)

"Springs preserve is all about existing within parameters that we have. Existing within the water and land that make sense, in a situation where you have to subsidize it massively with money from ratepayers, that's not about living responsibly," said Launce Rake, Progressive Leadership Alliance of Nevada.

Mulroy told the I-Team that the deal with Wolfgang Puck is being reconsidered. She's asked Puck to renegotiate. The preserve has also taken steps to create a more ambitious marketing plan and has hired some outside experts to devise one so that more locals know the place exists. 

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