Fernley, Fallon, Elko and beyond: Northern NV communities feeling ripple effects of booming Reno-Sparks, TRIC
2019 economic outlook for Winnemucca
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FERNLEY, Nev. — Thanks to its booming and diversifying economy, Reno-Sparks has seen a steady stream of companies and people flood into the region over the past five years.
With the rapid growth comes challenges for the region — from a lack of qualified workers to a lack of housing. And Reno-Sparks isn’t the only area impacted.
From Fernley to Elko, the ripple effects from the explosion of Reno-Sparks and the Tahoe-Reno Industrial Center — the largest industrial park in the world at 107,000 acres — are being felt in ways big and small.
With that in mind, the NNBV checked in with officials of a few Northern Nevada communities outside of Reno-Sparks to get their perspectives on the good and bad of Northern Nevada’s growth spurt.
In Fernley, tucked east of Reno-Sparks in Lyon County, city manager Daphne Hooper said the community has seen both residential and business growth over the last few years, which has provided a revenue boost.
However, she said the city doesn’t see the funding necessary to address its biggest issues “such as infrastructure.”
“The city has over the past three years really started looking at planning efforts,” said Hooper, citing the city’s water resource plan, parks master plan and strategic plan. “So we’ve tried to anticipate some needs that we’re having in our community and going to continue to have. We’ve tried to really take a global look at where we’re going and putting those things in place to help us move forward.”
In terms of housing, Hooper said many of the challenges stem from the fact that a lot of the area’s manufacturing and distribution jobs don’t have high enough wages to support the increased housing costs. According to Zillow.com, the median home price in Fernley has jumped from $215,000 to $265,000 in two years.
With that in mind, she said the city of Fernley is looking at areas that might work for different housing types — multi-family or higher density — to meet the housing needs.
“People are getting pushed out a little bit, so we’re going to try to figure out how we address that in our community,” she said.
Hooper said because many companies are eying moves to Reno-Sparks, Fernley is getting more looks, as well. She pointed to the fact that snowmobile manufacturer Polaris in August broke ground in Fernley on a 475,000-square-foot distribution center to serve the western U.S. According to previous reports, the center will be completed by the end of the second quarter of 2019 and open with about 60 employees.
“Certainly as people are starting to look at the Northern Nevada region, they’re coming out and looking at Fernley as an option,” Hooper said. “From a business standpoint, there’s certainly opportunity out here for industry and business to come in and establish here. I think that it’s going to be really important for the jurisdictions to work together and try to come up with some strategies that maybe we can do collaboratively.”
The fast-growing cannabis industry in Reno-Sparks is extending to Fernley, as well. Hooper noted that Sparks-based Silver State Relief, which is being purchased by Canada-based C21 Investments, will be opening up a dispensary in Fernley by the end of the year.
Thirty-miles east of Fernley, Fallon is seeing an increase in commuters due to the continuous uptick of jobs available at TRIC, said Nathan Strong, executive director of the Churchill County Economic Development Authority (CEDA).
Citing the U.S. Census Bureau, Strong said more than 4,000 residents of Fallon commute outside of the county. That’s nearly half the population of Fallon (8,410), according to DATA USA.
“Part of the change our employers have seen is the ‘Tesla effect,’” Strong told the NNBV. “Tesla, Panasonic and even others up there are kind of siphoning off employees and they continue to because wages are about as good as what we’ll pay here (in Fallon), but then you get benefits, too, which all of our small businesses out here can’t. That’s a challenge of small businesses in the rural areas.”
To address the issue, Strong said the Fallon Chamber of Commerce is looking into following the lead of the Nevada Builders Alliance, which in October became the first trade association in the state to offer is members a health plan specifically designed for them. Meaning, the Fallon chamber is looking into bringing small businesses together to start a group health plan, Strong said.
He said addressing that need is especially important since the economic growth happening in Fallon is almost entirely small businesses.
“Any advantages we can give them, they will continue to grow,” he added. “I’m trying to attract jobs that they’ll take here (in Fallon) to keep them off the road to stop commuting. That’s been more or less my message to the community the last two years.”
Meanwhile, roughly 300 miles northeast, Elko has been indirectly impacted by the Reno area’s rapid growth, said city manager Curtis Calder. Specifically, he said, it’s caused the pool of contractors available for residential construction to shrink in Elko.
“A lot of contractors that would normally come out to Elko tell us that it’s hard for them to get subcontractors to come out because they’re busy in the Reno area,” Calder said. “Everybody wants houses and we don’t get the big players. We’re not getting the KB Home-type subdivisions; we’re getting small subdivisions that are maybe 50 or 100 units.
“So that’s been a challenge.”
Regardless, Calder said Elko has a “pretty healthy” housing inventory in Elko and neighboring Spring Creek to the south. He said no less than five subdivisions are in various stages of build-out.
“We’re actually ahead of our inventory, so we’re not in a housing crisis and we don’t see the escalation in housing prices that Reno has seen,” Calder said. As of Nov. 19, 2018, the median home prices in Reno and Elko were $420,000 and $275,000, respectively. “I think a lot of folks in Elko are glad we’re outside of that bubble because we’re not seeing the side effects of that growth like Reno’s experiencing.”
As such, Elko is seeing its share of companies look at Elko for expansion projects. Most recently, Calder said, Komatsu, a Japanese-based mining equipment manufacturer, broke ground on a $48 million service center that will create 150 new jobs. The 189,000-square-foot facility, slated for completion in early 2020, will be Komatsu’s largest in North America, according to a report by the Elko Daily Free Press.
Calder, however, said companies as big as Komatsu are not what Elko typically sees move into the area. While Elko is known for its mining industry, Calder said the city is hoping to diversify its economy with the small-to-midsize companies that invest in the area.
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