We have another “Mark Davis is gonna say something about the Oakland Raiders and Las Vegas on Thursday” report, this one with sources that are, if not named, at least identified a bit beyond the earlier rumors:
Davis’ appearance Thursday – and the commitment he is expected to make – could be a difference-maker. Davis will leave no doubt his franchise will pursue relocation to Las Vegas if the stadium project is approved.
“It’s huge because the committee sees (the Raiders) as serious,” a source close to the situation, speaking on the condition of anonymity, told this newspaper. “And if (the committee) approves the funding, there will be no stopping the train.”
Meanwhile, there is growing sentiment within the NFL that fellow owners are opening up to Las Vegas and granting Davis his wish to move there should he request it.
“It would be a good home for them,” said a high-ranking NFL source.
This pair of anonymous quotes — in particular the one identified as being from the NFL — give us a bit more of a sense of what’s going on here. Davis is clearly shopping around for a better stadium deal than he has now in Oakland (which isn’t a bad stadium deal, mind you, but it’s not as good as all the other teams that have brand-new stadiums that were largely paid for by someone other than them), and if Las Vegas ends up building a stadium, he wants to shake that tree now while the tree-shaking is good. And the league office is at least tacitly giving him the go-ahead to do this, because why the hell wouldn’t they? Having stadium offers in pocket is the lifeblood of the industry, almost as much as buying the silence of brain-injured players, plus it helps out a friendly local billionaire, and you never know when you’re going to need one of those.
Now, does this mean the Raiders are actually moving to Las Vegas? Not by a longshot, at least not yet. First off, Nevada still has to approve the $780 million in subsidies that billionaire Sheldon Adelson is looking for, and that phrase right there is why it’s likely to be an uphill battle. But even if the stadium is approved, “pursuing relocation to Las Vegas” is no guarantee of relocating to Las Vegas — Davis could change his mind if he gets a better offer from elsewhere, or the NFL could change his mind for him, or (most likely) he could change his mind and then have the NFL deny him approval to move (or place an exorbitant relocation fee on it) to provide him with plausible deniability if he decides he’d rather move to Los Angeles or San Antonio or Walla Walla or wherever.
Las Vegas wouldn’t be as terrible a location for the NFL as for, say, hockey: Sure, Vegas’s TV is smaller than West Palm Beach and the only people with any spending money there are tourists, but football is the one sport where local TV deals don’t matter, and with only eight games a year maybe the Raiders could sell themselves as a destination theme vacation or something. I’m not saying it’s a good idea — staying put in Oakland, even in an older stadium, could well be better — but it’s not completely crazy. And as far as creating leverage goes, it makes perfect sense. Plus Davis can make a side trip for a haircut!
@Neil….I think what got lost in the 62 comments in the last Raiders post (is that a FoS comment record??) is the idea of leverage. Vegas could make all the sense in the world or no sense at all, but if Davis is smart (and that’s a big IF), leverage is the key to this game.
Will Oakland fall for it? At this point we haven’t seen any signs of that.
And, it doesn’t matter where the stadium is, as long as someone is willing to give him one, he will take it.
An interesting repercussion could be what happens to the Charger’s option in LA. Right now, the opportunity for the Rams to sell PSL’s is delayed until one of the two “LA option teams” commits to share Inglewood. So Stan has a cap on revenue until Dean/Mark make their decisions. Currently, that delay could be as long as two years if the Chargers get their initiative approved and then opt to extend for a year while court challenges proceed. If the Charger’s initiative isn’t approved, Davis either accepts LA or goes on the clock with his new found leverage against… both Oakland and LV?
JC: Well that was covered in another 62 comment discussion. :)
He gains no leverage because both the public and the politicians in Oakland are dead set against any publicly financed stadium and willing to let the Raiders leave. The Raiders has maximum leverage at the point when they had a stadium plan in Carson, the relocation committee was recommending that stadium and the NFL was saying “this is your last chance.”
There will not be a public stadium in Oakland. Period.
And before we rehash the same old ground, this isn’t because “Oakland sucks” or “haha, Oakland is poor” or any of that. Oakland’s $1.2B/year city budget and growing tax base could easily finance a stadium, but public stadium handouts are bad idea and Oakland voters are too progressive / too well educated (people don’t realize 39% of Oakland has college degrees, way above the national average though lower than SF and SJ) / too sensible / whatever to go for it. Period. End of story.
Talk about a win-win-win. Raiders get leverage (ostensibly), Adelson gets a dome and Vegas gets to repurpose its proposed convention center upgrade towards something more useful.
And Nevada gets $780 million less in tax revenue! Wait, money is like golf scores, where lower numbers are better, right?
Why do you need a dome in a desert?
I mean I guess they can argue “hey, we can repurpose the dome as convention space” which is perhaps less absurd in Las Vegas than in most cities. However, only a few conventions would need that much space and the obviously one that would is CES, which happens in January.
I guess you’d have to plan on the Raiders never making the playoffs, which also is perhaps less absurd with the Raiders than with other teams.
Leverage against what party exactly? San Antonio? Oakland has not and will not budge. And the Vegas situation has no bearing on the LA or San Diego situation.
It could be leverage against Kroenke in agreeing to a lease, if the Chargers stay in SD. But, sure, leverage against San Antonio, or Oakland, or St. Louis, or whoever. A savvy businessman gets the leverage first, and worries about what to do with it later.
I also am wondering “leverage against who.”
How is it leverage against Kroenke? The leverage against Kroenke is PSL sales and the threat that the NFL will make life unpleasant for him in some unspecified way if he doesn’t share his stadium and the LA market.
If Spanos stayed in San Diego and Davis said “if you don’t agree to a lease with me I’ll go to Vegas instead” I’m sure Stan Kroenke would dance in the streets. It would give him an out on the compromise he had to make to get the votes he needed to move to LA.
Kroenke can start selling PSLs in 2017 regardless of what happens with a second team. He doesn’t need an excuse to say no to Davis at that point if he wants to.
Understood. However, my guess is the NFL has other carrots and sticks to make sure Kroenke plays nice.
However, assuming they don’t and playing out the entirely Machiavellian scenario it still isn’t leverage because at that point Kroenke wouldn’t even take Davis’ calls anyways.
My best guess is Davis is playing the pre-LA option, 1980s game where you shop around to see whatever marginal market (at the time Indianapolis, Jacksonville, Nashville, etc.) will give you a stadium and then you move if they do. Of course, as I pointed out before, none of the teams that did move ended up making more money than the teams that replaced them in their existing markets and the 80s are over. However, no one told Mark Davis, or his hair.
Here we go again. As a native Las Vegan, this deal has absolutely no shot of happening using its current funding model. There are too many competing interests to allow it (i.e. too many hands out for the corporate welfare). The LVCVA needs nearly $2.5 billion in taxpayer funds for their expansion projects. The state and county needs billions more for their transportation projects (Las Vegas is by far the worst-planned city in the country, with backward-thinking on-the-take politicians and transportation “experts” using archaic models). Adelson is in a fight with the LVCVA due to his facilities being in direct proximity. He complains about the LVCVA having a competitive advantage by using taxpayer money to expand, yet he wants taxpayer money to expand (his operation). I haven’t even begun discussing how the revenue is to be split considering UNLV (actually it’s Joe Taxpayer, since the land is being purchased by bonds) owns the land. Are they going to lease it to Adelson while he builds? You know how notorious NFL owners are in regards to keeping all revenue generated from the stadium. That is not going to fly with Adelson. This thing is dead.
There is plenty local money in Vegas, plenty of local corporate sponsorship that isnt gaming related as well. The biggest issue is, Sam Boyd can’t house an NFL team.
Well that and about 800 million dollars
“There is plenty local money in Vegas, plenty of local corporate sponsorship that isnt gaming related as well.”
On a per capita basis Las Vegas is one of the less prosperous metro areas in the US with tourism-related service jobs making up the bulk of the employment. While many of those are decent union jobs that let people buy a middle-class home, they aren’t the sort that yield a lot of expensive PSL sales.
As for companies, Nevada has 4 Fortune 500 companies: Las Vegas Sands, MGM Resorts, Caesars Entertainment, and Wynn Resorts. All are gaming related and the largest one is the one building this stadium.
While some in Las Vegas have been trying to build a non-gaming sector to the economy, with the Zappos folks (now owned by Seattle-based Amazon) being one example, it’s fair to say that is at best early-stages.
A temporary stadium isn’t the biggest issue by a long shot but yes, the $800M is.
No it isn’t. The wages here are stagnant and have been for years. The economy in Southern Nevada hasn’t diversified nearly as fast as the North. Plus, you underestimate the competitive forces between the Sands, Wynn, MGM Resorts, and Caesars Entertainment (which is $21 billion in the hole – they have money, right?). The high-paying construction contracts go to out-of-state companies (mainly based in Arizona and California) who then bring their labor force in (look at Tesla and what they are doing in Reno). As far as Zappos; that is a disaster. His ideas have flopped faster than pancakes. There are way too many bars downtown cannibalising each other. The restaurants are hurting.
Again, where is the money going to come from? Eventually taxing tourists is going to reach critical mass. It’s bad enough they pay exorbitant resort fees, expensive dining and entertainment options, and now parking. Oh and due to greedy casino executives, tourists now subsidise employee wages via tip-pooling. All with the expectation of gambling and/or shopping. Now you want to hike all the taxes (auto, food, entertainment, hotel, etc) onto them. And when the tax revenue from the tourists isn’t enough, who do you think have to make up the difference? Mind you, Joe Taxpayer is still paying for City Hall, the Smith Center, Fremont Street Experience, and the Mob Museum.
Jay: I have done a diatribe in the past about my loathing of Las Vegas. As for the decent union gigs, I find it personally sad that the last place a person who a generation ago might have worked an auto line or a steel mill in Detroit, Pittsburgh or Baltimore for a decent wage can find work is dealing cards in Las Vegas and that people keep being drawn for that reason. It’s a sad reflection on the US.
That said, by all rights Las Vegas should have been done in by Atlantic City, done in by pervasive gambling throughout the country and finally done in by the rise of Macau pulling off the high rollers. Yet, it’s still there and building newer, crazy and more hair brained stuff every day.
Therefore, I’ve given up predicting what crazy shit will happen there next.
There is only one city to whom a Raiders to LV threat makes sense as a credible leverage ploy – San Diego.
Staying in Oakland just isn’t going to happen. The Coliseum has, at the very least, acquired the perception that is an old, run down stadium in disrepair and the worst stadium in the NFL by a country mile. As mentioned above, both the Mayor and the citizens of Oakland have made their voices clear that any kind of new stadium package that would make Davis even think twice about moving is unacceptable. There is zero chance of a new NFL stadium there, and there is zero chance that Davis will stay in the Coliseum. The Raiders’ days there are numbered.
Leverage against Kroenke would not come in the form in the threat of a move to LV, but rather in the form of the NFL twisting Kroenke’s arm to force him to accept Davis as a tenant in a deal that doesn’t completely bend the Raiders over. As things presently stand, Kroenke has the #2 media market in the US entirely to himself, and is almost certainly going to want to keep it that way. If I were in Kroenke’s shoes, I would be doing everything, absolutely everything in my power, to keep the Raiders out of my shiny new stadium and away from that sweet, sweet PSL/ad/entertainment district money.
And of all the remaining possibilities, should LA be out of play due to the Chargers deciding to bolt there after all – and the possibility is very real given just how much of a longshot getting their initiative passed is – San Diego becomes far and away the most attractive destination for the Raiders. They already have an NFL capacity stadium, Qualcomm Stadium, and the Raiders are pretty much the only team in the league who would view moving into Qualcomm as an upgrade. They already have a mayor willing to chip in $350M for a new one (or to renovate Qualcomm). They would have a fanbase who, fresh off of being spurned by Spanos twice (and no, they will not follow him north up the I-5, San Diegans despise LA), would be more than happy to turn towards their hated archrivals. And while sure, they could work out a deal to renovate/repair/replace Qualcomm on the cheap, Davis must surely be thinking bigger. And because they’re the most attractive option, Davis needs some manner of leverage ploy, otherwise he’d have to operate entirely on San Diego’s terms.
Tilus: That actually sounds oddly plausible.
A few questions:
1. Can Kevin Faulconer spend that money without a ballot initiative? It seems implausible that after one initiative failed another would pass.
2. Is Faulconer termed out in 2020? I know SD has term limits but his first term wasn’t a full one. Pulling something like this is more plausible if you don’t have to face the voters.
3. Is there any local office (Congress, etc.) Faulconer has his eyes on? Obviously statewide office isn’t in the cards for a Republican in California, but does he want another office or is this it?
If he can spend the money on his own, has offered to before, and never has to face the voters again, then yes, that sounds somewhat plausible.
Mark Davis reminds me of a kid that tells his parents, ” I’m running away from home! This time I really mean it!”
http://www.npr.org/2016/04/27/475913440/las-vegas-columnist-quits-after-ban-on-writing-about-adelson?utm_campaign=storyshare&utm_source=twitter.com&utm_medium=social
Scola,
The end is near for my hometown. I won’t be here watching it all unfold. The city is desperate to diversify, yet it is so corrupt it makes it virtually impossible to do so. There is some incredible talent and entrepreneurial spirit here, yet it is overshadowed by cronyism. I know people who have tried to secure work with the city, county, and state; successfully won the contract/bid, yet were sued by a much larger company because that company didn’t get the work. Same thing with renewable energy. It is inexplicable that Nevada isn’t a leader in the industry. Yet when the entrenched quasi-public utility squashes competition in favour of building massively inefficient solar farms, it kills participation in the industry. All solar installation companies have left or are in the process of leaving Nevada due to Buffett’s company. There are literally only a handful of companies controlling everything in the state, and they are all in bed with one another.
Quick example: I was in line for a pretty lucrative contract. Our products are clearly superior than the competition, and has been conceptualised by many in the industry. Yet when the contract was about to be awarded, the government entity was sued by the incumbent company for anti-competitive practices. That was the moment when I decided to began to look for work outside of the state.
What upsets me more than anything is this preconceived notion that everything is fair. That is a bunch of bull. They (multi-million dollar corporations) tell you to pull yourself up by the bootstraps, but when you do and are able to compete with them, they change the rules. Whether it is the re-classification of what a small business is ($500 million or less), or the minimum net-worth a person must have to secure SBA funding ($500k); the rules (in which they are exempt) are such in flux it’s hard to compete.
@Scola:
1) The committment actually breaks down to $200M from SD, which would be paid off via lease revenue bonds, and $150M from the rest of the county ($125M upfront, $25M paid on the second year of construction). An earlier article implied city officials said the city’s portion wouldn’t require a vote, but the pamphlet offered to the NFL seems to run on the assumption that a vote would be required (the County’s portion will definitely require a vote). I couldn’t tell you how much of either half would require either a simple majority or a 2/3 supermajority. In either case, Faulconer isn’t actually responsible for the entire sum, and may or may not have to face SD voters for any of it, but could result in parts being accepted and parts not being accepted.
2) The SD Mayor office is on a two 4-year term limit. While Faulconer’s first term is a partial term, the city counts any term lasting 2 years or more as a full term. Faulconer took office in March 2014, so yes, he would term out in 2020.
3) I’ve heard no news or rumors of Faulconer aspiring for any kind of higher office beyond his term as SD mayor.