The revised AECOM report on a proposed Las Vegas MLS stadium is out! And the answer to how it deals with that mysterious double-counting of $4 million in rent is that it just omits the entire $4 million from operating revenue, which it absolutely should, because it’s not. (It would go to pay the city’s construction debt.)
With the $4 million gone, the projected $1.7-2.8m in net operating income turns into … $2.4-3.5m in net operating income. Whaaaaaaa?
Here are the relevant tables from the original report (above) and revised report (below). Care to play One of These Things Is Not Like the Other?
First off, there’s a new $2.7 million a year item called “tenant reimbursement,” which further down is defined as:
We assume that the MLS team will pay a share of the facility’s overall expenses, based on its share of stadium usage (as a percent of total attendance). This line item represents a payment to the stadium from the team, and is assumed to be approximately $2.7 million per year.
I have no frickin’ clue what this is. (Nor do the Las Vegas Review-Journal or Sun, apparently, since neither mentions it in their coverage.) Is the MLS team suddenly agreeing to share more revenue than the $4 million a year in rent plus $500,000 a year in non-soccer revenue that was previously proposed? Would an MLS team make enough profit to afford all this? And if not, would the city have to cover any fees that would otherwise leave the team running losses, as was previously reported? Reply cloudy, ask again later.
All that’s still not enough to turn a profit for the city, though, so AECOM then lops off about $1 million a year in “management fees” (money that the city would pay the MLS team for running the stadium, because why would they run their own stadium for free, jeez?) and $800,000 a year towards a “capital maintenance account” (because why account for future maintenance costs now, when that will just make the numbers look bad).
So either the would-be Vegas MLS team is proposing to increase its contribution by $3.7 million a year (good!) or it’s juggling numbers around randomly to make sure that the economic analysis shows the city coming out ahead (less good!). Tomorrow’s public hearing is going to be some kind of fun.