One piece of news that floated out of Carson City this week told you the $1.9 billion needed to build the Raiders a new stadium in Las Vegas low-balls the real cost by about a third.
It wasn’t until the Nevada Assembly on Thursday voted on the state’s $750 million subsidy for the stadium that the Las Vegas Review-Journal broke the story that the project will need about $900 million more in cash that the state does not have to pay for transportation improvements.
Stadium backer Gov. Brian Sandoval’s people say the $900 million will go toward carpool lanes and freeway interchange projects that are already in the pipeline – as if they would have been built at some point anyway. You know that is not always the case with the apples in the eyes of transportation planners.
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Maybe they’ll also approve a gasoline tax to pay for the road upgrades, which assuredly would please the stadium project principals. That would be Sheldon Adelson, the multibillionaire hotel-and-casino magnate, and his lesser partner, Mark Davis, the inherited millionaire who owns the Raiders and has hopscotched around the West with his hand out for stadium money, just another mendicant in search of salvation.
It could get very nasty in Las Vegas if the citizens decline to tax their fuel to lessen the burden on the football motorist. Imagine the traffic jams on game days, without those carpool lanes and interchanges to manage vehicular movement near the southern end of the Strip.
$900 millionAdditional money needed for transportation improvements to accommodate a proposed stadium for the Raiders
Inconveniently for Adelson and Davis, the expensive little problem of road-building held up the Legislature’s vote on the smaller subsidy, scheduled for Thursday, by a day. The Assembly approved it Friday, voting 28-13 to raise hotel taxes in the Las Vegas area by 1.4 percent. The bill was then sent back to the Senate to OK some minor amendments. Then Sandoval gets to do his thing.
Politicians pushing the $750 million subsidy for Adelson and his buddy Davis have sought to minimize the gift of public funds by making tourists pay for it through higher room taxes.
Who doesn’t like a stadium that somebody else is paying for?
But it could be that Las Vegas hasn’t thoroughly thought this through. In the Department of Unintended Consequences, the room-tax hit could wind up producing a net loss in this important stream of revenue that helps fund schools and transportation and local government.
Nevada’s underlying financial analysis on the stadium project crazily asserts that more than 20,000 tourists – in the form of fans of visiting teams – will fly into town for Las Vegas Raiders games. Then, the assumption goes, they’ll stick around for a few days and fund the stadium through their added room taxes.
Their thinking – according to Stanford economist Roger Noll, an expert on the sports and entertainment industries – is “completely unrealistic.”
“There’s no NFL team in the country that comes remotely close to that,” Noll said of the projected 20,000 travelers per visiting team.
Even if football tourism performs as the stadium backers anticipate, the 225,000 visitors each year will amount to barely a speck when compared to the annual 40 million visitors in Las Vegas.
Noll said if even one-half of 1 percent of those 40 million are dissuaded from going to Las Vegas because of the higher room tax, it would “swamp” the expected financing of the Las Vegas stadium fantasy.
The $750 million the Nevada Legislature has forwarded to the governor, Noll points out, would amount to the largest public subsidy of a sports stadium in American history – by $200 million.
Speaking of rich, the money will primarily aid Adelson, the chairman of the Las Vegas Sands Corp. who purportedly is worth $30 billion and who is putting up only $650 million toward the stadium. Davis is throwing in $500 million.
You’d think Adelson could afford the whole thing if he wants a football stadium so badly.
However, as Noll points out, “He didn’t get to be a 30 billionaire by spending his money unwisely.”
Adelson, of course, is one of the leading political “dark money” men in the country, spending tens of millions on political campaigns without having to disclose where much if it goes, thanks to the joys of Citizens United v. Federal Elections Commission. He did own up to the $5 million he gave this year to Republican presidential nominee Donald Trump, and he got a good seat to the first presidential debate to see his guy lose by five touchdowns to Hillary Clinton. A CNN poll had it 62 percent to 27 percent in favor of the Democratic nominee.
Who knows what Adelson wants out of his stadium investment. The likely answer is, more than a good seat.
“Almost certainly,” Noll surmised, “what Sheldon Adelson has in mind is associating a casino with the stadium.”
Perfect. And you can bet Nevada will build him a nice footbridge to link the two.