Ormsby House: Even a great location no guarantee of success By John L. Smith, CDC Gaming Reports August 15, 2018 at 8:00 pm CARSON CITY – If success in business starts with three words – location, location, location – then the Ormsby House must have seemed like a surefire winner when it opened in 1972 almost directly across the street from the Nevada Capitol. With so many rubes and risk-takers coming to Carson City every other year for the state Legislature, you’d think that crowd alone would have ensured the Ormsby’s solvency.The name itself was historical. Published accounts record Major William Ormsby opening the original hotel and rooming house in 1860. Owning a hotel didn’t kill the major. Ormsby died in the Pyramid Lake War in a battle with Paiute braves. Postcard featuring the Ormsby House.The hotel was eventually purchased by Basque sheepherder Dominique Laxalt and later torn down. Laxalt liked running the place so much he remained a sheepherder and was gone for long stretches at a time. With remarkably little money down – insert arched eyebrows here – two of Laxalt’s sons would manage to find favorable financing for the construction of a new Ormsby House in the early 1970s not far from the original place. It may have helped that one of those sons was former Nevada Gov. Paul Laxalt, who died recently at 96. His life and legacy were richly lauded from Nevada to New York with particular emphasis placed on his longtime friendship with President Ronald Reagan. His relationship with the Ormsby House wasn’t mentioned in detail. Maybe it was because it became one of the most painful parts of Laxalt’s long life and career. Questions about the Ormsby’s casino operations and management published in 1982 in the Sacramento Bee led to a long-running, $250 million libel suit that had an impact on Paul Laxalt’s political career but was eventually settled out of court with both sides declaring victory. The Laxalts enjoyed running the 200-room Ormsby so much they sold it to Woody Loftin three years after it opened. He embarked on a plan to make it a big success, and at one point added a parking garage that had everything but automobiles. Loftin died in 1986, and despite the best efforts of his son Truett Loftin it continued to struggle. It closed in 1993, according to published reports, and eventually collapsed into bankruptcy. Indians once again had a dramatic impact on the Ormsby House, this time in the form of the spread of Native American casinos in California. The competition that reservation gaming generated continues to be felt in Northern Nevada’s casinos. Nevada Sen. Paul Laxalt (r) with President Ronald ReaganThe Ormsby was reopened in the mid-1990s for a brief time by Barry Silverton, but once again slipped into bankruptcy. Even the charismatic former Nevada Lt. Gov. and future Reno Mayor Bob Cashell couldn’t solve the Ormsby puzzle. Al Fiegehen and Don Lehr bought the Ormsby House for a song out of bankruptcy in 1999. All these years later, I wonder if they wish they hadn’t. Lehr reflected at the time in an Associated Press story, “This is our town. The town needs this hotel. It needs it to be run properly. Carson City has been good to us. We’ve enjoyed living here. We’ve prospered here.” And they have tried, oh how they’ve tried, to break the Ormsby curse and bring it a level of glory it never really knew. Today, despite every effort, the Ormsby remains closed just a short stroll from the heart of state government. Stories have been reported about the possibility of converting the hotel into housing and the casino into commercial business space, but no one seems all that confident. And who can blame them? Today, the Ormsby remains closed. The Ormsby’s checkered financial history makes me wonder whether some of its modern operators might have preferred the major’s fate to the frustration of trying to make the Ormsby profitable. Contact John L. Smith at email@example.com. On Twitter: @jlnevadasmith.