If there was any doubt about whether Nevada Gov. Brian Sandoval was going to call a special session of the state legislature to discuss $750 million in subsidies for an Oakland Raiders stadium in Las Vegas after his hand-picked task force recommended spending the dough, that was dispelled yesterday when Sandoval said this:
“I am convinced that, given the circumstances and timing with regard to public safety, the convention center, and the NFL, there is an opportunity to significantly improve the tourism infrastructure of Southern Nevada — already the best in the world,” Sandoval said.
“Based on the current environment, I believe a special session of the Legislature is warranted and should be called as soon as can be practicably accomplished,” he said.
The session is likely to start sometime between October 7 and October 13, which will give the Clark and Washoe county commissions time to fill five vacant seats in the legislature before then. You have to figure Sandoval has taken the temperature of the legislature and figures the stadium plan has at least a decent chance of passage, or he wouldn’t be doing this, but we’ll see once deliberations start. A stadium bill would need at least two-thirds approval, remember, since it would involve a hotel tax hike; failing that, a simple majority vote could kick it to the seven-member Clark County Commission, which would need five votes to pass it.
If it seems incredible to you that Nevada is on the verge of approving the largest NFL stadium subsidy in history to benefit a billionaire developer and the owner of a team that hasn’t had a winning record in 14 years, yeah, me too. At this point, I’m mostly curious to see whether the legislature spends any time at all debating the niceties of a stadium lease — who would pay for future maintenance, operations, and upgrade costs, and would Mark Davis be able to get out of his lease and move again (or threaten to) anytime soon? Not holding my breath given how the political discourse has gone so far, but there’s always hope.
Not recommending/condoning assault and violence, but this morning read about a pie in the face of Sacramento mayor Kevin Johnson for spending so much money on sports facilities while education and infrastructure is neglected, The assailant apparently is facing felony charges and the mayor apparently used his athletic skills to tackle and beat up the assailant. Why isn’t malfeasance of office, misappropriation of tax dollars and racketeering as enforced as a criminal act as a pie in the face?
Hell, I think KJ maybe should be facing charges for his disproportionate response.
For this or that unfortunate ‘misunderstanding’ over sleeping arrangements years ago?
In order to buy into the reason that the Governor and the stadium backer’s logic with regard to the reason for building this arena, you have to believe the following scenario occurs:
Wife: Where do you want to go on vacation?
Husband: How about somewhere with big resorts?
Wife: Great! How about a place with dazzling casinos and big shows and great restaurants?
Husband: Sounds like Las Vegas. Year round good weather, we could hang at the pool!
Wife: Exactly! And we can dine at Coluccio’s restaurant. Or Flay’s. Or any one of a dozen great places to eat.
Husband: I’m totally with you, except…and this is important: do they have an NFL team with a world class football stadium?
Wife: No…..
Husband: Oh…then lets go to Pittsburgh instead.
In fact, not only does this conversation have to occur once or twice, but about 100,000 times (a year) to make this stadium viable for its stated purpose.
I will never understand this theory that an NFL team can fill an NFL stadium, at NFL prices, with tourists who have no rooting interest in the game.
This turn of events is nearly as shocking as Stan Kroenke paying for his own stadium in LA.
We also need to talk to those dolts from Forbes. Don’t they realize that, in the NFL, the local market doesn’t affect revenues and franchise values? Sheesh.
At some point won’t Adelson and Davis be in conflict? Sheldon’s got the stadium (and the money) but Davis has the team (and no stadium, and little money outside the team’s value.) And won’t the NFL be hesitant to partner with an international gambling company?
In conflict over what? There’s plenty of pie to go around.
Over power and control, and who gets to accept the Lombardi trophy when the Raiders win the Super Bowl. Raiders win Super Bowl, ha, I crack myself up.
I imagine Sheldon’s gotta get some ownership stake for his efforts.
Adelson’s stake in this is that if he doesn’t get the stadium, the Las Vegas Convention Center will grow even bigger. He has a privately owned convention center that he built about twenty years ago and has long complained that room taxes go to fund his bigger, far older, publicly owned competitor. The tourism bureau that owns the convention center just purchased/demolished an aging casino to expand it further.
Adelson needs something to direct tax dollars to that doesn’t aim at the business convention crowd and drain available funding for that convention center expansion. Davis needs a guy who can pay for even 40% of a stadium since he’s the tightest fist at play.
Local market size does affect NFL revenues and franchise values some, just not as much as in other sports. (You can still sell your tickets for higher prices, get more for naming rights and ad boards, etc.)
Ben,
I’d say the purchase price has to do with two factors, neither of which are really positive for Las Vegas.
1. The bid has to be through the roof to overcome Las Vegas’s obvious shortcomings as an NFL market.
2. The fact that there are some people who gather absurd wealth through gambling businesses is no better sign of the economic health of a location than stating that things are great for oil-rich places just because their rulers can afford to buy soccer and basketball teams.
The idea that this move will somehow improve tourism is crazy. The team is a plaything for sheikhs.
Also, probably any team going on the market today would go for about $600 million–as the NFL has given no indications of expanding again. The franchise value in this case wouldn’t be indicative of the location.
Say this remind me, didn’t the Rams have to pay a penalty to the NFL when the moved to St. Louis? I don’t think the league was happy with them for leaving LA. They paid a relocation fee of like, 29 million. They got hit coming and going.
550 mil was the fee to go back. I don’t know where Mark Davis would get this kind of dough but maybe Adelson and the mob from Vegas can find it in a trash bag somewhere out back of the casino in a dumpster.
Long as I wet my beak, I don’t care who pays what!
The 550 million was because it was Los Angeles. The Las Vegas relocation fee will probably be much lower, in line with the market size. But should still be a hit.
They had to pay $29 million plus $17 million in revenue sharing from PSL sales. However, considering that the city of St. Louis gave them $67 million in relocation costs plus a free (albeit crappy) new stadium, I’m not shedding too many tears for the team.
Crappy by current standards, but when it opened it seemed pretty sweet, (yet dark). Perfect sight lines, loud environment. The whole “worst turf in sports” thing wasn’t a problem when the team was winning. The more the team lost, the more they complained about their stadium.
Correct, and you should shed no tears over that sweetheart deal. NFL teams were only worth ~$150M-$200M back then, so a city like St. Louis (or Baltimore or Nashville) could build a $200M stadium, and that’s enough to lure a team away, and its value would skyrocket despite the smaller market size.
LA Times, December 24, 1994: “St. Louis Rams? Offer Looks Hard to Refuse – Proposed deal instantly would make them one of the richest franchises in sports”
http://articles.latimes.com/1994-12-24/sports/sp-24082_1_st-louis-rams
Quote:
It’s the ultimate get-rich-quick scheme, and the Rams don’t have to invest in junk bonds, put together a pyramid scheme, go on a Las Vegas junket or blow a month’s payroll on Super Lotto tickets.
All they have to do is strike a deal to play in St. Louis [which] would take the Rams from the NFL’s poorhouse to its financial elite …
“Certainly, a move to St. Louis would make the Rams one of the most profitable teams in the league,” said Paul Much, sports finance consultant for the specialty investment banking firm of Houlihan Lokey Howard & Zukin in Chicago …
“You look at this deal and wonder why a team would leave the nation’s No. 2 media market,” said Alan Friedman, editor of Chicago-based Team Marketing Report. “That doesn’t matter much–what matters is what you can make in game-day operations. They can’t do in Anaheim what they can do in St. Louis.”
The reasons are simple. In St. Louis, the Rams would receive all revenue from luxury boxes, club seats and concessions and a share of revenues from in-house advertising and potential stadium naming rights in a luxurious, state-of-the-art facility …
The team would pay $25,000 a game in rent, but $75,000 in game-day expenses would be paid for by the St. Louis Regional Convention and Sports Complex Authority …
“The fact that there are some people who gather absurd wealth through gambling businesses is no better sign of the economic health of a location than stating that things are great for oil-rich places just because their rulers can afford to buy soccer and basketball teams.”
Most of the wealth is coming through China now. This is not so much a gambling capital as much as it is a clubbing and partying town with gambling available. And the biggest winners in the casino business operate casinos for extremely wealthy people who bring millions with the expectation that they will fritter it all away. It was the ultra rich keeping the town afloat through the recession as the middle class dollar bottomed out. But the middle class dollar has lately not amounted to much to begin with.
Nevada recognizes that it needs to do more to diversify it’s economy beyond gambling, although Clark county will always be tourism focused. If millennials never quite take to gambling like Generations before them did, the state wants to keep some jobs and the county wants to keep some tourists.
As a resident of Nevada, in addition to agreeing that this whole scenario is incredible, I also find the behavior of all those involved in this fiasco to be incredibly disgusting.
Since the Raiders play in the crappiest stadium in the NFL in the crappiest city in North America, I can’t see how a move to a brand new facility in a glitzy (if gaudy) city being is a bad thing.
The NFL may be sending Grubman out to Oakland to extort more money from the marks again.
http://www.cbssports.com/nfl/news/nfl-sending-strong-signals-to-bay-area-leaders-that-it-wants-raiders-in-oakland/
All this because they don’t want to share a crappy stadium with the 49ers?
I read that article too and kept looking for any legitimate journalism, facts or meat, but all I got out of it was:
“..sources say..”
“Numerous ownership sources have indicated..”
“One source with knowledge of the situation..”
“..said one source with knowledge of the situation.”
and
“Grubman declined to comment for this report.”
So, really, this is not any better than some of my grade school research projects where I got a D b/c I made up everything and my bibliography had more holes than swiss cheese.
Does’t tell me squat.
As for sharing a stadium…it’s the LAST thing Davis would want. teh opportunity to “share” is long gone (and was a pipe dream) and no team wants to be a tenant b/c they can’t control the revenue.
I quite agree but it’s the kind of stuff that comes out as leaks. So unless someone gets hold of his travel plans, it’s tough to back up.