|By John G. Edwards, Las Vegas
Review-JournalMcClatchy-Tribune Regional News
Jul. 14, 2009--The Boulder Dam Hotel is closed, but the Boulder Dam Credit Union is only starting to deal with problems at the hotel.
The 20-room historic hotel that dates to 1933 -- once host to Howard Hughes, Bette Davis and James Cagney -- shut its doors at midnight Saturday because it is running out of money and unable to get additional funds from the city.
The credit union holds two mortgages totaling $940,000 and is owed $170,000 that was provided to rescue the landmark in 2005, according to Credit Union Journal. The Boulder City Museum and Historic Association, owner of the building, is 90 days past due on hotel mortgage payments.
General Manager Bill Ferrence declined to confirm or deny that the credit union holds loans on the property.
"I will not talk about anybody's individual loan accounts whatever because to me that is not right," Ferrence said Monday.
Ferrence, however, said the $512 million asset credit union could take a $1 million loss on a loan and still remain sound as a financial institution.
The credit union reported a net worth of $47 million on March 31 to American Shares Insurance, the private organization that backs its deposits.
Nor does Ferrence think loans to the hotel are a problem.
"If I was a lien holder on the Boulder Dam Hotel, me personally, I wouldn't worry about it," Ferrence said.
The hotel was purchased 16 years ago for $500,000 and has spent $3 million in improvements, he said.
In 2005, Boulder City divested its interest in the hotel, which relieved the city of responsibility for hotel operation costs.
During the first five months of 2009, room rentals at the hotel declined $60,000, compared with the same period a year ago, Ferrence said. Occupancy is as low as usual during the summer, he said.
Ferrence knows that, in part, because he was president of the association that owns the hotel, but he resigned as president when it closed because of objections raised by critics.
Ferrence said he sees no conflict of interest, noting that he does not approve credit union loans. However, Ferrence said he did not wish to burden the association with a distracting debate about his presidency.
Contact reporter John G. Edwards at firstname.lastname@example.org or 702-383-0420.
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