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July 21, 2007
Vegas approves arena; money a mystery
The Las Vegas city council on Wednesday approved a proposal by developers REI Neon to build a $500 million arena downtown as part of a larger redevelopment project. Not included in the agreement: Details on who will pay for it. The Las Vegas Review-Journal reports that REI Neon is asking for a $650 million property tax rebate (unclear if this is cumulative or present value) on the entire $9.5 billion development; the Associated Press reports that REI Neon consultant George Postolos told the Review-Journal (in an article that looks to have disappeared from the web) that the project could need "bonds against future sales tax revenue" as well, which would imply a STIF (sales tax increment financing) as well as a TIF (tax increment financing).
I've discussed the many problem with TIFs before, so I won't go into that again. For now, just note that without an NBA or NHL tenant, the Vegas arena would basically be built on spec - which should bring smiles to the faces of team owners looking to shake down their current cities by making move threats.
Funding is an issue, and one you cover so well Neil, but this is rather a bizarre action in another respect, i.e. considering the scandal involving the NBA referee. I would think pro sports leagues would be even more reticent now to locate a franchise in Vegas
Posted by johnw on July 22, 2007 12:48 AM