Vegas approves $122m for nonexistent soccer team, in second-largest MLS stadium subsidy ever

D.C. United wasn’t the only MLS franchise to win a big public stadium subsidy yesterday — or at least, not if you count wannabe MLS franchises as well: The Las Vegas city council voted 4-3 yesterday to approve $56.5 million in stadium subsidies and related infrastructure costs for a new stadium to host an as-yet-unnamed, as-yet-nonexistent MLS team that would begin play at an unspecified time. Add in $20 million for a parking garage that will be used by stadiumgoers (for which the team will get to keep parking fees for soccer matches), free land appraised at $38 million to $48 million, plus a full property tax abatement worth between $8 million and $16 million in present value, and you’re talking between $122 million and $140 million in public subsidies, or enough to be the biggest soccer stadium subsidy in U.S. history, if only D.C. United hadn’t set a new record the same day.

It’s absolutely the biggest subsidy ever for an MLS team that doesn’t exist yet, though, so Las Vegas, take a bow!

Meanwhile, it’s worth noting that though the Las Vegas Review-Journal has done some excellent reporting on this deal, it’s still prone to the kind of misunderstanding of basic financial math that plagues too much development reporting. Check this out:

To pay off a $50 million bond, the city would have to borrow $90 million to pay the interest on the loan.

If anyone can identify what that’s supposed to mean, please let me know.

Vegas councilmember explains MLS stadium flip-flop: “TESLAAAAAAAAAAA!”

There’s a long article in today’s Las Vegas Review-Journal profiling the “two Bobs” on either side of the city’s MLS stadium proposal: Bob Beers, the councilmember who’s been savaging the proposal on his blog, and Bob Coffin, the councilmember who was agin the stadium plan until it was amended to include $25 million in parks for his district, after which he was fer it. (Coffin says he finds accusations that he was “bribed” to support the deal “amusing.”)

The most notable bit, possibly, comes at the very end, where Coffin has this to say about how throwing public dollars at private enterprises can be good sometimes:

“I’m used to dealing with competing interests … People who want zero public dollars haven’t seen how things are built in this state. Tesla. Can I say Tesla? Can say I say that five or six times?”

You can say it all you want, but it might not mean what you think it means.

Vegas swing vote could be swinging back to support MLS stadium, because parks!

Remember how yesterday I wrote this about the proposed Las Vegas MLS stadium deal?

The please-let-it-actually-be-final council vote is set for next Wednesday; if past history is any guide, we won’t get much of a hint of the outcome before then, unless Bob Coffin tips his hand before then.

Bob Coffin has now tipped his hand, and it looks like he may be swinging back to the “yes, let’s give $90 million to a soccer stadium for a team that doesn’t exist yet” side:

Councilman Bob Coffin, a consistent opponent to using public money for the stadium, has softened his stance and appears ready to support a new financing plan that includes $25 million in city money to build the stadium. The key to Coffin’s shift is a new wrinkle in the plan that would guarantee about $25 million for improvements to city parks, something Coffin says is especially needed in older neighborhoods like the ones he represents.

“It’s not the same deal as it was. They’ve improved it a great deal,” Coffin said. “The debt potential is really minimized now. The raid on the revenues for the parks has stopped … It’s going to really help us.”

The Las Vegas Sun isn’t clear on exactly when Coffin said this, but given other quotes from Coffin included in their article, it’s pretty clear that his main concern was getting more money for parks, and now that the stadium deal includes some more money for parks on top of the $90 million for the stadium, he’s all, “Cool, more money for parks!” Which helps explain why the only revision the stadium proponents made in the deal since the council voted in October to “reduce or eliminate” public subsidies for the project was to throw some money at parks, because why worry about making the whole council happy when you can just placate the one swing vote?

All of which should be a lesson: If you’re an elected representative body and want to eliminate public subsidies for a sports stadium, you might want to actually vote down the public subsidies, rather than voting for “Here’s another two months, see if you can come up with something that will get one councilmember to defect from our narrow majority.” Just a suggestion.

Vegas’ final offer on MLS stadium: $76.5m, plus free land and tax breaks and … we’ll get back to you

There is yet another MLS stadium financing plan in Las Vegas, and it goes like this: The city would provide $31.5 million in infrastructure spending, plus $25 million in stadium bonds to be paid off via hotel taxes, plus a $20 million parking garage that would be used by stadium patrons among others (and would be paid for by a TIF district). Plus free land and a property tax break, which the city doesn’t know how much they’d be worth, because they’ve only been working on this for half the year.

That’s marginally better than the $90 million-ish in subsidies that was proposed back in August, maybe, depending on how much of the free land/property tax rebates/garage was included in that deal back then and similarly left off the balance sheet.

It’s not anything like the promise to “reduce or eliminate” public subsidies that the council demanded back in October as a condition of reconsidering the deal, but maybe they’ll figure that getting $25 million shunted from the stadium to public parks will be enough of a fig leaf that they can move ahead? Or maybe they’ll say screw it, we said no then, we meant it. The please-let-it-actually-be-final council vote is set for next Wednesday; if past history is any guide, we won’t get much of a hint of the outcome before then, unless Bob Coffin tips his hand before then.

Las Vegas council extends deadline on MLS stadium deal, figuring maybe it’ll look better in the morning

Two months after giving developers Cordish Cos. another two months to “reduce or eliminate” public subsidies for their MLS soccer stadium plan, the Las Vegas city council voted yesterday to give them another 16 days. Not that the subsidies have been significantly reduced or eliminated — though the council has proposed redirecting some of the stadium money to build public parks — but who knows, maybe there will be a breakthrough?

The swing vote at this point, according to the Las Vegas Review-Journal, appears to be councilmember Bob Coffin, who is now saying things like “Give and take are part of politics. Nothing is perfect.” That sure sounds like just haggling over the price, but I guess we’ll find out by December 17. Maybe.

Vegas MLS plan shunts $25m to parks, asks “Now can we have our money?”

Las Vegas city officials have made their first attempt at “reducing or eliminating” public subsidies for a proposed MLS soccer stadium, as required by the city council, and it involves … spending more money, but on parks?

Las Vegas city officials are working on a plan to help deliver a new downtown soccer stadium by packaging the soccer venue with four possible park projects and a parking garage under a $45.7 million to $50.7 million bond proposal. … Parks were included in the new funding plan after many residents voiced concerns that hotel room tax revenues that were used to pay for city parks projects would be re-directed to help pay for the $200 million, 24,000-seat soccer stadium.

Okay, that can’t be it. What else did they say?

“They get to eat what they kill,” [city manager Betsy] Fretwell told council. “It becomes their risk, not ours.”

I’m sorry, what?

The city would still borrow $46 million to $50 million, by paying $3 million annually for 30 years, Council Member Bob Beers said.

“It’s a reduced public money approach, not an elimination of public money,” Beers said after the council meeting.

Translated into English, this appears to mean: The city would still borrow the same amount of money and spend $3 million a year to pay it off, but about half of that would now go to parks funding instead of stadium construction costs. Another $20 million from sales tax increment financing bonds would go to build a parking garage, which the soccer team could use, but which visitors to the Symphony Park cultural center could also use.

This is an improvement on the old plan, certainly, in that the total stadium subsidy is now  around $45 million, which is way better than the roughly $90 million that was originally floated. Whether it’s a good deal is another question — the councilmembers who were skeptical before still sound skeptical, so we’re likely to see lots more haggling before the final vote on December 17. Which is a good thing — haggling is exactly what city councilmembers are supposed to do when presented with a request like this. Keep on doing what you were elected to do, Vegas councilmembers! Show us that democracy isn’t irrevocably broken!

Vegas council keeps soccer plan alive, but only if developers agree to nix subsidies

The Las Vegas city council met yesterday to decide whether to kill or keep alive Cordish Cos. and Findlay Sports’ soccer stadium plan, and ended up … doing neither, kind of? With four of the seven councilmembers ready to vote down the $3 million a year in city subsidies the developers were looking for, a compromise plan was instead offered by councilmember Ricki Barlow: Vote to keep negotiating with the soccer developers, but only if they agree to work to reduce or eliminate the public subsidy.

If that’s confusing to you — is it reduce or eliminate? and by how much? — then it’s doubly so to Cordish and Findlay, which were decidedly not in on this deal. “They worded it poorly,” Findlay advisor Dean Howes told the Las Vegas Review-Journal afterwards. “They have to come back and tell us what it means.” In particular, the developers want to know whether it’s just the $3 million a year that needs to be eliminated (or reduced), or if the council also wants to do away with $21 million to be provided by a TIF district, or $14 million in infrastructure help? Also, can they still ask for that pony?The upshot is that things are pretty much the same as before: A 4-3 majority on the council doesn’t want to give the soccer stadium all this money, and it’s up to the developers to come up with a plan that doesn’t require any, or at least enough less money that they can live with it. Cordish and Findlay now have two months to come up with a new plan. Or replace the councilmembers with robots. One of those two.

Swing vote on Vegas MLS stadium says she’s “leaning towards the no”

Tonight’s the city council decision in Las Vegas on sinking $3 million a year into a new MLS stadium (actual MLS team not included), and all eyes are on swing vote Lois Tarkanian, who has remained a mystery as to which way she will

I’m leaning towards the no,” Tarkanian said late Tuesday afternoon, with stadium studies and phone messages piled on her City Hall seventh-floor office table. “A stadium would be great for the city, but I think it’s a little too early. Either way, I will have a lot of people hating me tomorrow.”

Aw, come on, spoilers!

The two likely scenarios here are either that Tarkanian decides to stick a fork in the plan, or votes to kick the can down the road another two months, in hopes the stadium developers come up with a plan that doesn’t involve the city almost certainly losing money. Can-kicking is a time-honored local government tradition, so I’ll put my bet on that one, but it still doesn’t make the MLS plan anything better than mostly dead.

Vegas MLS stadium bonds would require general funds as backup, casting council vote into even more doubt

The Las Vegas MLS stadium plan, which is already holding on by the skin of its teeth, could face another major hurdle, with Vegas financial consultant Guy Hobbs noting that the city would almost certainly have to use general revenues as a backstop for its $3 million a year worth of stadium bond payments:

“In all likelihood, the city will pledge general tax revenues to secure those bonds because this source of revenue (collected room tax fees) can be renegotiated and theoretically go away and not be a revenue source that would a good pledge,” Hobbs said Monday.

“Bondholders want to make sure that the money they have paid for the bonds will be repaid to them without fail over the life of the 30 years,” Hobbs said. “You pledge a source of revenue to repay … What ultimately is at risk is the general tax revenues.”

In plain English, this means that nobody’s going to buy bonds if the only guarantee they’ll be paid off is some hotel tax money that may or may not exist. So instead, Las Vegas would need to promise that if the hotel taxes don’t come through, it would fill in the gap with other city funds.

This ultimately isn’t a huge deal — either way, the city is pledging $3 million a year, so it doesn’t matter all that much which pocket it comes from — but it’s certainly not going to help win any votes on a city council that is currently set 4-3 against continuing to negotiate the soccer stadium deal beyond tomorrow night’s council meeting. In fact, Lois Tarkanian — yes, she’s married to that Tarkanian — the swing vote on the council, is now saying she’ll only vote to keep the deal alive if the developers drop their demand for a city subsidy, and that won’t happen because:

Cordish/Findlay wants the $90 million subsidy from Las Vegas to build the 24,000-seat stadium on 61 acres in Symphony Park because the partnership argues its profit margins are too thin.

Yeah, don’t we all. Speaking of which, could you readers please deposit $90 million into my Supporters fund? My profit margins are way too thin.

Vegas MLS developers: Forget all that we-pay-you-for-your-debt business, just give us $3m a year

With a majority of the Las Vegas city council unconvinced by their revised financial plan, boosters of a publicly subsidized MLS stadium have come up with: a completely new financial plan! Now, instead of the city putting up $7 million a year or so in bond payments and getting (maybe, if the team turns enough profit) $4 million a year back in rent payments, the city would just kick in $3 million a year, and the team would put its $4 million a year into paying off new private loans, and pay no rent.

It’s the same deal as before, then, except for eliminating the risk that the team wouldn’t make enough money to make the rent payments and leave the city on the hook for more than its $3 million — which is a potentially big concession. No word yet on what councilmembers think of this, but we should find out soon enough: The council is set to vote next Wednesday on whether to keep negotiating or kill the deal dead.