LAS VEGAS -
For this city's CUs it's created a challenge many others would envy-racing to capture business from all those new prospective members. But growth comes with a price. Housing prices skyrocketed from 2003 to 2005, making many neighborhoods unaffordable to low-income workers, and some "locals" have gambling addictions (see related story, next page).
Dan Paulson, CEO of WestStar CU, noted between 6,000 and 8,000 people move here every month, and have now pushed the population to nearly two-million.
"That means new members," Paulson said. "We serve gaming employees and more casinos are going up, so there are more potential members for us."
Las Vegas is "a lot more stable than it used to be in the 60s and 70s," Paulson assessed, before adding, "It used to be cheap to live here, but that's not really the case any more."
Tony Mook, CEO of Cumorah CU, said Las Vegas residents are staying longer because there are job opportunities and, of course, a sunny climate.
"There used to be affordable housing, but now that is relative to the prices in California," he said. "There is more mainstream acceptability of Las Vegas. Instead of 'Sin City,' there are more businesses and conventions. The economy here is stable, despite concerns about residential construction. There is a great deal of commercial construction, which has transferred workers from residential to commercial."
Brad Beal, CEO of Nevada Federal Credit Union, noted expansion can have a down side. "I've been here almost 20 years and the town has grown a lot. Schools, roads and governments are bigger, but they are still overburdened," he said. "There is a shortage of doctors and nurses due to rapid growth."
The population growth has triggered investment in infrastructure, which is good news for Silver State Schools CU. Dave Rhamy, its CEO, said SSSCU enjoyed net membership growth last year of 7%, significantly better than the national average, which in the past year has been relatively flat for credit unions. According to Rhamy, the gaming and hospitality industries have a reputation of being unstable, but the city has become larger and has made a conscious attempt to diversify, "which has helped with the transient image Las Vegas previously had," he said.
"There has been a concerted effort by the Las Vegas Chamber of Commerce, and by all of Southern Nevada, to bring more industry here," he said. "It is a more business-friendly climate compared to neighboring states. There is not much heavy manufacturing, but there is light manufacturing. And, transportation is big because it is a good place to distribute goods to California and to the Southwest."
There has been an increase in education spending-meaning more schools and teachers-thanks to general growth in the area, he continued. "Our credit union is education-based, so we don't see the type of turnover as in other industries. Therefore, we don't churn members like other credit unions do."
According to WestStar's Paulson, part of the stabilization of Las Vegas is a significant senior population that has moved here, along with more upper-end housing. "It is not just people moving here and gambling their money away-although some do," he said. "Gambling is an issue for some people, and some of those don't make it and move on, but most people have a regular income. Gambling is all over the country, so Las Vegas is not the only place to play any more.
"It is becoming a more mature city," Paulson continued. "We have shopping and entertainment. Venetian has 'Phantom of the Opera,' the Wynn has 'Spamalot,' and there is art. It is becoming more sophisticated. But with so many people moving here, it is a young city."
Cumorah CU's Mook concurred. "I think we have a broader-based economy, so we see less problems with gambling. Of course, there are neighborhood casinos and some people have problems, but the major casino chains have done a good job of promoting the problem gambling hotline."
Mook, however, is hesitant to label Las Vegas "mature."
"A mature city is one with firmly established culture: art, opera and museums," he said. "Some of those things have been improving, such as the Guggenheim branch at the Venetian and the art museum in the Bellagio. It is maturing, but still not mature. When I moved here in 1990 there were just over 400,000 people in the Las Vegas Valley. In 17 years, we've quadrupled in size."
Mook predicts that as baby boomers get closer to retirement and California continues to age, the city will see more inward migration from the Golden State. "Las Vegas and the Southwest is a viable home for many Americans. People will want an area where they don't have to shovel snow, where there's less taxation and lots of entertainment," he said. "Credit unions in the area have expanded their charters to become more community oriented. For them, and for the rest of us, that means we need more branches and more ways to reach new folks. It is a challenge to get into new neighborhoods, especially with people who have not been here before."
Paulson of WestStar is optimistic about Las Vegas' future based on several "huge" commercial, shopping and gaming projects that are in construction or planning stages. "The Las Vegas Strip will continue to move forward, and other areas will be developed, which means more jobs and more growth for the area," he said.
Silver State Schools' Rhamy sees the potential for Las Vegas as "very strong." He said it is an internationally known city, and added economic diversification efforts are helping.
"There are a number of people who come here and don't gamble. We have world-class chefs and restaurants, it is becoming a mecca for shopping, and there are the shows. There are a lot of other reasons people move here. The city does a good job, and there are a lot of jobs that pay well, but don't require more than a high school education."
To succeed, Rhamy said CUs need to "keep doing what we've been doing in the past." But, he stressed, that does not mean credit unions should not change.
"We need to make sure we do what our members want. I'm from a banking background, so I can say it is easier to operate a credit union because we don't have shareholders," he observed. "Take care of your members, and they are your best advertisements. We just need to uphold our basic principals like we always have."
Unlike its boom/bust past, Las Vegas has been on a boom cycle for "a while," said Beal of Nevada FCU. "It's been a steady up tick for the 20 years I've been here-I've never seen a bust. One reason is it is an international destination. There is weakness in the residential housing market, but it has been a correction, not a bust. I think we will continue to grow in the marketplace, and will continue to see a relatively healthy economy."
