Sisolak: “It’s not a ‘company town'”

Blockchainsville
A rendering of Blockchains LLC's proposed Painted Rock Smart City concept. (Credit: EYRC Architects + Tom Wiscombe Architecture)

Nevada may redefine what it means to be a company town.

As part of a promise to diversify the state’s one trick pony economy, Nevada Gov. Steve Sisolak is pushing the state legislature to pass legislation allowing tech companies to create a new form of local government, complete with the authority to establish taxes and provide government services to its residents.

No legislation has been formally introduced or released by the governor’s office. However, the Las Vegas Review-Journal and other media outlets have previously reported on draft language. On Friday, Sisolak held a virtual press conference with Governor’s Office of Economic Development Executive Director Michael Brown and Applied Analysis Principal Analyst Jeremy Aguero to discuss the concept, which the governor called a “bold and admittedly nontraditional approach.”

Sisolak described the concept of an Innovation Zone as a “subgoverning community, much like a city or county, but wholly focused on innovation.”

“It’s not a ‘company town,’” he added.

But there is zero doubt the proposal is designed around Blockchains LLC, a company backed by a cryptocurrency millionaire with an audacious plan to build a “smart city” in Storey County. Blockchains in 2018 purchased 67,000 acres of undeveloped land for $170 million.

Aguero said it would put Nevada on the map as the “nucleus” of blockchain technology, which is often associated with cryptocurrency but can go well beyond that and be used to record any type of data.

When details on the Blockchains smart city proposal emerged after the land purchase, the plan received national attention. Blockchains founder Jeffrey Berns told the New York Times at the time: “This will either be the biggest thing ever, or the most spectacular crash and burn in the history of mankind. I don’t know which one. I believe it’s the former, but either way it’s going to be one hell of a ride.”

Blockchains has more recently detailed its plans for a Painted Rock Smart City with “36,000 permanent residents, 15,000 housing units, 11 million square feet of commercial space and more than 22 million square feet of industrial-related development.”

The company believes starting a city from the ground up — as opposed to retrofitting smart technology into existing structures — would allow the potential of blockchain technology to be fully realized by government, financial institutions, healthcare systems, utility providers, transportation systems and people.

Sisolak, Brown and Aguero say the Blockchains smart city will bring an “immediate investment” of $250 million in land and infrastructure development, as well as a commitment to invest $1 billion over a decade. To qualify to create an Innovation Zone, companies must own 50,000 uninhabited acres of Nevada and have “specialized knowledge” in innovative technology — like blockchain.

Sisolak and Aguero emphasized that the project includes no tax incentives or abatements. The pair is known for helping orchestrate the $750 million public subsidy deal secured by the NFL in 2016. Sisolak was Clark County Commission chair at that time.

They also emphasized that taxes paid within the Innovation Zone would still benefit the state. The establishment of an Innovation Zone would coincide with the creation of a new industry-specific tax.

Sisolak asked people to keep an open mind about the concept, which has already drawn comparisons to dystopian sci-fi movies.

The governor said Friday’s presser would be the first of many discussions on the proposal, which will no doubt face logistical and political hurdles.

One such hurdle involves securing the water necessary for the proposed project, an issue Sisolak punted on when asked.

“We’re always concerned about water in Nevada,” he said. “They’re responsible for providing water.”

When asked by a reporter Friday about the possible environmental impacts of erecting a new city in an undeveloped part of the state, Sisolak said the project has plans to be carbon neutral and that because “they’re working with a blank slate” they will have the best transportation and clean energy technology available.

“The application is limitless,” he added.

No timeline has been given for the introduction of Innovation Zone-related legislation.

April Corbin Girnus
April Corbin Girnus is an award-winning journalist with a decade of media experience. She has been a beat writer at Las Vegas Sun, a staff writer at LEO Weekly, web editor of Las Vegas Weekly and a blogger documenting North American bike share systems’ efforts to increase ridership in underserved communities. An occasional adjunct journalism professor, April steadfastly rejects the notion that journalism is a worthless major. Amid the Great Recession, she earned a B.A. in journalism from the University of Nevada Las Vegas, where she served as editor-in-chief of the student newspaper. She later earned an M.A. in media studies and a graduate certificate in media management from The New School for Public Engagement. April currently serves on the board of the Society of Professional Journalists Las Vegas pro chapter. A stickler about municipal boundary lines, April enjoys teaching people about unincorporated Clark County. She grew up in Sunrise Manor and currently resides in Paradise with her husband, two children and three mutts.