[Raiders owner Mark] Davis told an influential tourism committee gathered at UNLV that the Raiders would put up $500 million toward the stadium if Nevada legislators approve public funding for the project and other NFL owners allow the team to relocate…
“We do want to be your partners. We’re not coming in looking for a free handout,” Davis said. “I want to tell you what I told Gov. Sandoval a few weeks ago: Together, we can turn the Silver State into the Silver and Black State.”
That’s not exactly the catchiest slogan, but never you mind about that. Let’s take a closer look at exactly what Davis (and billionaire would-be Vegas stadium builder) Sheldon Adelson) are offering, and what they’re asking for:
- The stadium would now cost $1.4 billion, up from $1.2 billion just a couple of months ago, presumably because if it’s hosting an NFL team it’s going to need a snazzier eternal flame.
- Davis’s $500 million pledge would include $200 million in NFL G-4 money, plus $300 million out of his own pocket.
- As for the other $900 million, $750 million of it would be from hotel and rental-car taxes (down slightly from $780 million in the last proposal), and the other $150 million would be in mystery “private funds.” Since we haven’t mentioned Adelson yet, and he has $150 million in loose change in a jar in his kitchen, maybe he could bring that.
That’s the deal as presented in the headlines today. What’s being largely overlooked is this, which appeared way down in the 18th paragraph of the Las Vegas Sun’s story:
The companies would also want a tax increment district in the area around the stadium. Details would still need to be ironed out, but Majestic executive Craig Cavileer said the district would help the stadium’s private backers get a return on their investment.
This is potentially huge: “tax increment financing,” for those who need a reminder, involves kicking back increased property and/or sales taxes from an area around a development project, to help pay the project’s costs. We obviously have no idea how much money it could provide — depending on how big you draw the district, it can generate an almost unlimited amount of tax revenue — but if Adelson and Davis are looking at this as a way to provide a “return on investment,” that means it’s going to go to reimburse their $650 million in costs, not state taxpayers’ $750 million. In other words, if enough TIF money can be agreed on, the private costs could be as low as zero, with the entire $1.4 billion nut either provided by tourist taxes or by TIFs.
It’s an incredible bit of media legerdemain to turn a request for potentially the largest NFL stadium subsidy in history into headlines about a promise to put up half a billion dollars in private funds — props to Davis’s (or more likely Adelson’s) PR strategist for coming up with this one. And that’s before even getting to Davis’s “commitment” to Las Vegas, which as I predicted Wednesday comes with a whopping out clause, in that if he gets an offer he likes better, he can always have the NFL vote against the move, and say, “Hey, sorry, they wouldn’t let me go to Vegas, I tried.”
Not that I expect Davis or the NFL to turn down this deal if it really includes both $750 million in cash plus additional TIF subsidies, because who would turn down a new $1.4 billion stadium essentially for free, regardless of what market it’s in? We still have to see if the Nevada legislature is crazy enough to approve it, but this is no longer merely a leverage deal: It’s an attempt at the biggest public cash grab in NFL history, which if Davis can pull it off despite currently having zero other legitimate bidders for his team’s presence would seriously move him up the rankings of evil supergeniuses with questionable haircuts.