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.

Youth soccer group opposes Vegas soccer stadium, because irony

Journalists love irony, even those who don’t work for Slate, so this had to be irresistible:

The [Las Vegas MLS] stadium funding foes also include another unlikely group — the Nevada Youth Soccer Association, which represents 10,000 statewide soccer players, including 7,500 in Southern Nevada.

Soccer moms opposed to a soccer stadium! Now there’s man-bites-dog.

The problem with the MLS project, according to the Nevada Youth Soccer Association, is that it would use $3 million of city parks money, at the same time that Las Vegas is raising soccer field usage fees by $40 a kid to cover the parks department’s budget deficit. The city says the money that would go to the soccer stadium is from the parks capital budget, not the operating budget, and … moving money from the capital budget to the soccer stadium budget is easier than moving it to the field maintenance budget, I guess?

Anyway: Soccer moms opposed to a soccer stadium! There’s another week to go before the city council votes on whether to keep this deal alive, so we’ve got to kill time however we can.

Swing vote on Vegas MLS deal says she’s joined the “no” camp

If you’ve been staying up nights trying to understand how the latest Las Vegas MLS stadium financing plan works, you can probably stop, because it looks like the entire project just ground to a halt:

A proposed publicly subsidized soccer stadium in downtown Las Vegas appears doomed as Councilwoman Lois Tarkanian, the swing vote on the deal, said Thursday she would vote against the proposed financing plan if the council vote were held today…

“I don’t feel like spending a lot of taxpayer monies on it. People do want a stadium, but they don’t want the use of public money,” Tarkanian said.

There are still two weeks to go before the council’s October 1 vote on whether to kill the soccer plan dead, which means lots of time for proponents to see if they can get Tarkanian to pull a Michelle Spence-Jones and name her price for switching her vote. Given that “use of public money” is an integral part of the plan, though, it seems like Tarkanian has drawn a line in the sand that’s going to be hard to erase. Not impossible to erase, mind you, since it’s local elected officials we’re talking about here, but still I wouldn’t go investing in any Vegas MLS season-ticket futures just now.

New Vegas MLS plan omits $4m/year in double-counted rent, adds $4m/year in new mystery money

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?
Screen Shot 2014-09-17 at 9.30.10 PMScreen Shot 2014-09-17 at 9.29.49 PMFirst 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.

Vegas officials offer “pep talk” on soccer stadium, no explanation yet for double-counting rent

Last night marked the first “town hall” meeting on Las Vegas’s beleaguered MLS stadium plan, and the economic consultant’s report that was supposed to be reissued by Friday to fix that $4 million a year typo … still is nowhere to be seen. What Vegas residents got instead is what the Las Vegas Review-Journal called a “pep talk” from city officials and soccer boosters about just how great a new stadium would be. Check out how the Las Vegas Sun described it:

City staff along with developer Justin Findlay, managing partner of Findlay Sports and Entertainment, fielded questions. They explained the stadium would be paid for using a combination of city room tax dollars and rent from the soccer team. If the team is successful and stays in the stadium for 30 years, the city’s share of the project costs would shrink to $82 million, 41 percent of the total.

City Manager Betsy Fretwell acknowledged that if the soccer team struggles and has to shut down, the city would be on the hook for the estimated $8 million annual bond payment. She downplayed the chances of that happening and said there would be time to fix problems if the team struggles to draw big enough crowds.

Not to tell Findlay and Fretwell what to do, but “If the team does well we’ll only lose $82 million, and if it does poorly we’ll be on the hook for much more — but don’t worry, we’re sure it’ll all be great!” isn’t much of a pep talk in my book. But there are five more public meetings to go in the next nine days, so they have plenty of time to work on their material.

Meanwhile, the Review-Journal reports that the AECOM consulting report is due to be discussed at today’s city council meeting, so maybe we’ll actually get some answers then about how the consultants managed to double-count the proposed MLS team’s rent, once as arena bond payments, once as city operating revenue. Stay tuned.

Vegas stadium consultant: That $4m a year in MLS revenue was a typo, we’ll fix it

AECOM, the architecture and engineering firm that presented that disputed Las Vegas MLS stadium economic projection, has spoken! Not to the press, but to city officials, and their explanation for why their report appears to have double-counted $4 million a year in rent payments is a doozy:

AECOM explained the problem that [city councilmember Bob] Beers raised by sending a letter to City Manager Betsy Fretwell saying the company mistakenly forwarded portions of a previous draft of the feasibility study to city officials, according to Las Vegas spokesman David Riggleman. Fretwell then informed City Council members of the mistake, he said.

“They blended tables and data from earlier in the process. They will send us the corrected version,” Riggleman said. The city expects the correct feasibility study from AECOM later this week, Riggleman said.

This is pretty incredible: Apparently AECOM is saying that when it included $4 million in annual rent payments as part of the stadium’s benefits, even though it was already committed to pay off the city’s bond payments, that was something copied from the wrong version of the file. You know, the kind of error that anyone could make — the kind that represents almost half of the entire revenue projected from the stadium, and which when corrected would turn a $2 million a year city profit into a $2 million a year city loss. A little oopsie.

(The other possibility, of course, is that AECOM isn’t saying that the $4 million a year is in error, which means they still haven’t explained what it’s doing in there. I can’t wait to do a Compare Documents on the original and corrected versions of this report.)

No word, meanwhile, from the would-be stadium developers, Cordish Cos. and Findlay Sports, that hired AECOM (and in Findlay’s case, that gave a completely different explanation for the mystery of the $4 million yesterday that turned out, apparently, to be complete gibberish). If you’re in Vegas, though, you’re in luck, because starting next Tuesday, Cordish and Findlay representatives will be at a series of town hall meetings to take your questions, which may or may not include “What were you smoking when you decided to hire an engineering firm to draw up an economic impact study?”

  • Tuesday, Sept. 16 at 6:30 p.m. at Centennial Hills Community Center, 6601 N. Buffalo Drive

  • Wednesday, Sept. 17 at 6:30 p.m. at Doolitle Community Center, 1950 N. J. Street

  • Thursday, Sept. 18 at 6:30 p.m. at Rogich Middle School, 235 Pavilion Center Drive

  • Tuesday, Sept. 23 at 6:30 p.m. at Durango Hills Community Center, 3521 N. Durango Drive

  • Wednesday, Sept. 24 at 6:30 p.m. at City Hall Council Chambers, 495 S. Main Street

  • Thursday, Sept. 25 at 6:30 p.m. at the Development Services Center, 333. N. Rancho Drive

For those not in Vegas, there are a bunch of online options, but it doesn’t look like Cordish or Findlay reps will be there:

  • From Sept. 11 through Oct. 1, residents can share their thoughts in an online town hall called Crowd Hall. It will be available at https://crowdhall.com/h/303/

  • Las Vegas City Manager Betsy Fretwell will hold a Twitter chat on Sept. 18, beginning at 4 p.m. Use #stadiumchat to share feedback. Follow Betsy Fretwell on Twitter @BetsyFretwell

  • Las Vegas Mayor Carolyn Goodman will hold a Twitter chat on Sept. 22 at 8 a.m. Use #stadiumchat to share feedback and follow the mayor on Twitter @MayorofLasVegas

  • The city will host a Google Hangout on Sept. 30 at 11 a.m. Use #stadiumhangout to ask questions. Follow the city of Las Vegas on Google+ at google.com/+cityoflasvegas