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In Business Q and A
Bob Unger, Democratic candidate for lieutenant governor
Interviewed by Richard Velotta / Staff Writer

Bob Unger
Photo by Steve Marcus

For people who have no idea who the Democratic candidate for lieutenant governor is, look to the Las Vegas Strip.

Remember the giant Coke bottle and the M&M figures near the MGM Grand? That's Bob Unger's place.

Unger and a partner developed the Showcase Mall, bringing two of the nation's largest advertising and marketing icons to the Strip.

While bolstering tourism in that way may be Unger's biggest claim to fame, it isn't his only qualification. A Southern Nevada resident for nearly 40 years, Unger also has been a board member of the Henderson Chamber of Commerce and has served as past chairman of the City of Henderson Planning Commission. He was also vice chairman of the Growth Coordination Committee for the City of Henderson and served on the Henderson Redevelopment Advisory Commission.

He also practiced law and had a number of Strip clients for 12 years in the late '70s and '80s.

Unger talked to In Business Las Vegas about the campaign for lieutenant governor, which carries with it the chairmanship of two key commissions for the state, Tourism and Economic Development.

Next week, In Business plans to carry a Q&A with Unger's Republican opponent in the lieutenant governor's race, Brian Krolicki.

Question: As lieutenant governor, you would chair both the Nevada Commission on Tourism and the Nevada Commission on Economic Development. Would the expanding roles of those two commissions place too much on your plate?

Answer: It is a big job and I'm glad that people are starting to realize how important a job of lieutenant governor is. The economic development role is what I see as the key role and it's the role that attracted me to run for the office. I've been entrepreneurial in Las Vegas for many years, involved in several start-up businesses, some successful, some not so successful, but that's what the role of the entrepreneur is.

On the economic development side, I've continually watched our professional staffs. I've seen them have shotgun economic development throughout Nevada. It's "Come to Nevada, our climate is great, our taxes are great." I'd like to take more of a business approach. What are the assets this state particularly has to offer now and how do we take advantage of those assets? Let's go out and target specific industries. I want to make us famous for something besides gaming.

Do you think the lieutenant governor should take on additional responsibilities?

I'm going to wait and see, wait until I get into office. I see the lieutenat governor, frankly, as being a representative of the executive branch in the Legislature. There's a reason why the lieutenant governor presides over the Senate. I would like to work with whoever the governor is and help represent that branch and help bring those points across to the Legislature and work with the legislators. But it's really a matter of wait and see until I get in.

What are the biggest issues facing the Commission on Economic Development? With competition so rigorous, shouldn't the state be putting more money into it?

I don't know if it's more money that needs to be put into it or more effective efforts to be put into it. We need to approach specific industries. I'd do it the same way I did it, for example, with Coca-Cola. When we started the Showcase, it was really a matter of identifying the type of people we wanted to bring in and this was retail that had never been done before. I was not looking for the typical retailer. We went and convinced Coca-Cola Co. to go into the retail business. We went and convinced the Mars candy company to go into the retail business. Both of those were first-time stores. Coca-Cola had done a very similar thing in Atlanta, but it was only because that was their headquarters. You just need to target specific groups, but I don't think it takes more money. If it does, I'll be happy to go to the Legislature and ask for it.

Is Nevada underachieving, overachieving or moving at just the right speed toward diversifying its economy?

I think we're underachieving. That's part of why I wanted to run for this office.

Because ...

Because for years growing up here, all I've heard about is diversifying our economy and what has really happened is that our economy is gaming and our idea of diversification is that now we make all the parts for our slot machines. That's not diversification to me. That's still an industry dependent on the gaming industry. I would love to see us bring in new industries that are totally separate.

But isn't the reason why a lot of companies won't locate here because of what our education system is and, for that reason, would you support additional resources to education?

My role on the Henderson Chamber of Commerce recently — I've been on there eight years — for seven of those years, education was something that the chamber supported and we looked at putting together little programs, something like having the libraries add some books to the schools, things like that. It never was the central core issue for the chamber.

Recently, we've tried to attract new businesses to town that need a higher level of educated graduates. You know, our state has been in the business of educating people for jobs in hotels and as a result, we've run up against a roadblock of basically the decision not to come here for many businesses has been because of the education pool that we have and the difficulty of attracting higher educated people. We're seeing a real shortage in the nursing area and for teachers. We need to change the way we think about education in this state.

What is best business diversification opportunity on Nevada's horizon in the next five years?

This comes from some of my own experience in a couple of new businesses that started as a result of serving hotels. Years ago, I was involved in starting up live televised race and sportsbooks in casinos. At the time, Caesars was interested in getting the signal from New York racing into their casinos.

Back then, we had stand-alone sports books all over town. They were the kind of places that were right out of the movie "The Sting" where the guy would call the races right off of the race results. But we brought in live video into Caesars. To do that, we had to go to the (Federal Communications Commission) and change the rules to allow for private use of satellite dishes instead of just television stations.

We managed to take the signal off the tracks in New York and sign a contract to bring that signal to Caesars Palace out here. Nobody knew what to expect. We thought maybe 300 people would show up when we put an ad in the paper. We set up 300 chairs and a projector to see what would happen. Four-thousand people showed up! Suddenly, we now have these big race and sportsbooks and we really had no idea it was coming. From that, we took that dish that was sitting there. We had this big dish, what else we could do with it?

So we started putting movies in the room. We started downloading HBO programming, you go into your room and push a button. So that turned into a national industry. There are lots of national industries that can actually start because the hotels here are willing to be innovative and are willing to spend the R&D.

What I really want to go after here, and I think it's a natural ever since 9/11, we've committed to a really secure environment. We're going to have secure workplaces, we're going to need higher security in Internet fraud, online packing, everything else like that. Our casinos are already famous for this. Whether it's true or not,"CSI," "Oceans 11," all those kinds of things boost the image that Las Vegas is very security conscious. I believe we can go after the security industry for a couple of reasons. I think the hotels, for their own good, will pay the research and development necessary for a lot of small companies to come in and find new ways to secure people, places and facilities and make us more secure in the event of an emergency. Better systems for warning hotel customers when something is wrong. How do they get their instructions? How do they get moved?

If we tie that together with our university system and work on adding degrees for emergency population management where this literally becomes the place where people go to get trained. We'll train our own kids and let them go out and be the ones that protect the country. I think it would be a great industry to become famous for in addition to gaming. As a result, we'll have the technical people here that are developing the products and we'll have the trained university people here to manage the systems and I think it could be a huge future industry for us.

How has the rising cost of living affected the state's — and particularly Las Vegas' — ability to compete in the economic development arena with cities like Phoenix, Albuquerque and Austin?

Affordable housing has clearly become the No. 1 issue as far recruiting people. I sit on the board of the St. Rose Health Foundation. We have the new San Martin campus ready to open in November. One of the biggest problems we've had at that location is getting nurses and it's because they come to town and affordable housing is very difficult.

You may remember when I was on the Planning Commission in Henderson. One of the problems with affordable housing is that people don't want it in their neighborhood. It's like everybody fights apartment complexes when they come to the neighborhood. In Henderson, years ago, when we looked at the problem with multifamily housing, we decided on a unique approach to how we would approve multifamily housing. What we did was spread it around the whole city.

Growing up in Las Vegas, what Las Vegas typically did was if an apartment house was approved on one corner — of course everybody would come in and fight it — but when it finally did get approved, then for some reason they believed that if the apartment house was there, then the next apartment would be next door, and then the next one would be next door to that and we created throughout the city pockets of areas that are just apartments.

The first one I remembered was across from the Boulevard mall and that area became a very high crime area and a tough area to live in. Then the next one was out by Pennwood, out by Clark High School. And then the next one that I could think of was around Decatur and Tropicana. We kept doing that. When we looked at it at the city of Henderson, we said, "There's a better way," and we actually went around the country to see that.

What you do is, from a specific point on the map, you draw a circle a half mile around that point and that circle needs to remain 65 percent single-family and 35 percent multifamily. Once you do that, apartments and multifamily end up being spread throughout the city and people stop coming to hearings to oppose them, they're not worried about it, they end up being a part of the neighborhood, kids end up growing up with single-family homeowners and it's much better for society, things are much more integrated on economic levels.

I want to do the same thing with affordable housing. I've been in the development business, I've done a master-planned community and I know that if we make it a requirement of all developers to provide affordable housing as part of all projects, they'll do it, they'll all find a product that works and they'll all make money doing it. We'll end up with affordable housing throughout the city, which is where those teachers and nurses want to live. It will help take care of that market share we're not getting.

Amid the rising cost of living, officials in Nevada continue to proclaim that this state is still cheaper than California. Is it enough to pin Nevada's future on the economic problems in a single state, even if that state is as big as California?

No, we're growing so fast that we need people from everywhere. I am concerned about the rising cost of housing. If you bought a $50,000 home in 1970, five or six years later, the rate of inflation on housing here was incredible. While it was happening, everybody enjoyed it, but while it was happening, I was worried about it because I saw California go through it. People ended up buying houses, then all of a sudden, there was a downturn in the market. People were wiped out and they walked away from houses. So I am concerned about the rising costs and we need to be competitive in that area.

How would you rate California Gov. Arnold Schwarzenegger's efforts to repair that state's economic woes and improve the business climate?

He's got a tough job. I think there are many more structural problems in California, the tax structural problem, things like that. My own personal experience was with a company that was set up here. We founded the company here, all the partners were here, all the creativity was here, all the marketing was here, but we did some manufacturing down in California because the things we needed — parts and the machine shops — were down in California.

It was great being in California until the company started making money. Most companies lose money until the product is on line and sales are on line. While we were losing money, it was fine to be down there.

Once we started making money, California tried to impose taxes on every dime that we made. And we weren't a California-based company. We only did a small amount of what we did there. Their regulatory environment didn't allow them to even negotiate with us on percentages as far as what would be part theirs and part Nevada's. So once we became profitable, we took 40 employees and moved them here and the savings on California taxes were enough to pay for our building and the move here. It's a tough way to go in that kind of a tax environment.

How do you feel about the Commission on Economic Development getting the task of forwarding recommendations to the state's energy office on offering tax breaks to companies that develop environmentally friendly buildings?

I want to do anything we can to make this a green state. I want to go after renewable energy here. I want to figure out what role Nevada should play in the ethanol business, because it's going to be huge. There's lots of different crops. You don't have to grow corn to be in the ethanol business. I don't know the refining process, but would certainly work on us being part of the ethanol distribution function. Whether that's tanks and rail cars and who knows what it is, but we have to go after that business. The future of the country depends on us making that switch. We have the land for it, that's for sure. With some clever planning, we can go after it.

Switching gears now, what is the biggest opportunity on Nevada's horizon in terms of tourism?

I don't profess to be an expert in the tourism business. We have the best and the brightest already in Las Vegas. Our airport just recently was rated No. 1 by travelers, the Convention and Visitors Authority is just great. Our tourism market is on all cylinders and going strong. I've never seen so much construction planned as there is now.

There are a few things. The rurals need some help on tourism. One of the things I'd like to work on is to encourage Nevadans to go see our national park. I would bet most people in Las Vegas have never been up to Great Basin National Park and I would like to see some kind of a program where we figure out a way over the next couple of years to really make the Great Basin a place to see. We need some kind of incentive program and that would really help the rurals and their tourism. As for Las Vegas and Reno, they're running on all cylinders already.

What's the biggest obstacle to driving more tourism to Nevada? Would you propose additional appropriations to the Nevada Commission on Tourism?

I don't know that any of this is about money. I think with a good plan, it's an easy sell. I think it's about clear thinking. We have plenty of people involved, I think the staffs of those departments already are large enough, unless I figure out something to keep them a lot busier. It's not about money, it's about the proper effort.

How do you rate the state's success in international tourism? Are offices around the world cost-effective in delivering more visitors to Nevada?

One of the issues we have on international tourism is just getting the flights approved. I think we're certainly well known around the world. Most people around the world think of New York and Las Vegas as the places to come. That's an amazing fact that we've done a phenomenal job of making our image known around the world.

We need to work more on the practical issues, maybe working back in Washington with the State Department, getting those flights approved. Obviously, we're working on it and counting on it. They're building a new terminal building at McCarran International Airport and I hope we'll be filling that up pretty soon.

Nevada has paid a lot of attention to the Chinese market. Are there other places that you think would be good markets for tourism?

Not only the Chinese, but the Indian market. They're doing phenomenal growth of their middle class, people that are now able to travel. Their education is moving up, their whole economic base is moving up, same as in China. The growth rate of the middle class in China has been huge and it's the same thing in India. And it's getting that way all over Southeast Asia.

There's a tremendous movement of people in class, so there's more disposable income and an ability to come here. I'm still amazed by this statistic, and I don't know if it's still accurate, it was when we opened the Showcase project: Only 15 percent of the population of the U.S. has ever been to Las Vegas. That's amazing. It was higher in Orlando. So there's still plenty of room to attract the whole country.

Lt. Gov. Lorraine Hunt received a lot of credit for boosting tourism with her one-on-one style, but she also received some criticism for taking so many trips to Asia. Do you anticipate leading any tourism-building missions overseas?

I've talked to both Rossi Ralenkotter (president of the Las Vegas Convention and Visitors Authority) and Randy Walker (director of the Clark County Department of Aviation) about the way they see those things and they have convinced me that there is an important role for an elected official to visit those countries in a coordinated visit with them. I'm there to help their efforts, which would be my reason for visiting.

Isn't there an inherent political risk in taking these overseas trips, since some voters see them as pleasure trips and junkets that don't make a difference to the people of the state?

If I want to go on a pleasure trip or a junket, I'll pay my own way. I intend to work when spending taxpayer money.

Airline executives I've talked to have said part of the problem of flying to Las Vegas is that the market from Las Vegas to Beijing or Shanghai isn't likely to be very strong. How do you counter that argument?

That's very interesting. I'm fascinated by China. It's an amazing economy. I think American tourists would love to see China. Here we are trying to sell China so we can get them back here, but I think over time, they're going to become a much more important player in the world economy and there's a lot more fascinating places to visit.

I know in the ICSC (International Council of Shopping Centers) shows — which are usually a precursor of things that are coming, we're lucky to have that show here — it shows what's going on in the states and internationally and one of the more crowded and innovative areas is always China and the Orient.

So if I'm understanding you correctly, you're saying that as things evolve, Nevadans will become more interested in going to China?

Yes, we've become a huge trading partner with China. One of the games I play with people when they don't realize how much we do with China is say, "Look around your house and try to find something that's not made in China." I just bought an Apple computer. It was made in China. It's not just the cheap stuff, it's the high-end electronic stuff as well.

The Nevada Commission on Tourism has been directed to conduct "preponderance hearings" to determine whether developers building in tourism districts are eligible for bonds that are backed by sales tax revenue. What are your thoughts on the program?

If we have a specific need to be addressed, then I would try to structure it. One of things I have worked on is the Tuscany project near Lake Las Vegas. The Tuscany project was set up a a redevelopment zone run by the city of Henderson. One of the reasons it was done is that the city had a gravel pit that the city wanted turned into a housing area. The city had a desire to have that cleaned up, so there was a tax-exempt financing set up for that. If we have a specific purpose to set up tax-exempt financing, we should, but I'm not sure about tourism, as hot as it is in urban areas. Maybe in some of the rural areas it make sense. At this point in our economic life, I'm not sure there's a need for that kind of financing.

The Nevada Commission on Tourism got its first look at a budget for the next biennium. Do you support spending more than half of the proposed budget's combined $48 million on marketing and advertising?

I would have to look more closely at that budget. Certainly our Convention and Visiting Authority marketing budget, which is substantially higher than the state's, does a hell of a job. There's a reason all these people around the world think of New York and then Las Vegas next. That's why film and television are so much a part of our tourism, because nothing is as effective as a soft ad and all those television shows are soft ads for our state.

You're backing fellow Democrat Dina Titus for governor. Do you think the governor and the lieutenant governor should run on one ticket so that there isn't a philosophical change in leadership should the governor become incapacitated?

Without having served, my gut instinct is I like the idea of the one ticket. I think it makes the lieutenant governor a more effective player in the scheme of things. I think the lieutenant governor as the governor's messenger for the governor in the Legislature all the time, leading the Senate would probably be very effective. Obviously, it would be very helpful serving with Dina, but if Jim Gibbons is elected, I would hope to convince him that I could effectively represent the executive branch in the Legislature.

If Congressman Gibbons wins the race, how would that change your effectiveness as lieutenant governor?

I've been very lucky, I usually am able to win people over. Trust is an important thing. I would sit down with Jim Gibbons and ask where I could be effective and prove myself. There are many areas where Democrats and Republicans agree and lots of things we'd be working on. The idea of promoting a new industry in this state is certainly something that both sides would clearly say that's an important thing to do. I think there are many areas that I could work cooperatively with Jim and there's no issue about conflict. I'd hope to be an effective lieutenant governor either way.

Assess your opponent, Republican Brian Krolicki.

I have met Brian just a few times. He seems to be a very pleasant guy. My biggest issue is whether the state treasurer's job -- he's been in that office for 16 years either as an assistant or as the state treasurer — really helps. I've heard mixed reviews on his effectiveness with the Legislature. Several legislators have talked to me about having problems with him during previous sessions. I don't know if 16 years in the treasurer's office does anything to qualify someone to take over the role of economic development. I think my business experience is much more critical to bringing businesses here. Obviously, he has more understanding of the inner workings of our government, but I'm not sure that that's what it takes. If, God forbid, I would have to become governor or he would have to become governor, I'm not sure that his experience in the treasurer's office has prepared him for that role.

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