The “final” deal details for City of Las Vegas taxpayers to give public money to a downtown soccer stadium were released this week. It’s not very different from the last several sets of deal details, though it is much less risky for Las Vegas taxpayers than the first deal that was proposed (which had the city paying for almost all of it). And all of it is contingent on Las Vegas actually being awarded a soccer team (which seems less and less likely).
Here is what the City will be giving to the wealthy team owners:
- The City will borrow $25-million and build the stadium’s parking garage. The team owners will be given free use of the garage for up to 90 event days per year, during which they will be able to keep whatever they can charge people to park. This will be only a little closer to the front door than the existing even larger garage at the World Market Center, which is nearly empty 49 weeks out of the year (the other three weeks are when the World Market Center holds its international home furnishings trade show, when it is full). This seems likely to spark a “rate war” on most game days, when the World Market Center might charge less for parking than the team owners will charge.
- The City will give the team owners $56-million, about half of it borrowed on “revenue” bonds instead of “general obligation” bonds. The risk to taxpayers is identical, but the cost to taxpayers is much higher for technical reasons that Guy Hobbs explains here. The loan will be repaid from parks maintenance/construction funding. The other half is money that will empty out City savings accounts.
- The City has been given $50-million in coupons from the Federal Government that really rich people can use to get out of their income tax bills with (called “New Market Tax Credits”). The City plans to fire-sale these coupons for $10-million and give the proceeds to the team owners.
- The land in Symphony Park is worth $38-million to $48-million. The City didn’t pay that much for the land years ago, but has borrowed dozens of millions of dollars (still not paid back) to “improve the site.” Through a complicated long-term “ground lease”, this land will essentially be given to the team owners.
- The City will give back the “property tax increment” – basically about 75% of the property taxes that the facility would pay, something between a half million and a million per year. [This will only be given to the team owners if they actually build the stuff they’ve promised to build.]
- The team owners will offer soccer clinics for kids that the team owners value at a half million dollars per year (this is a league requirement for all MLS teams).
- The City Council gets a free luxury box suite in the stadium.
The council is expected to vote this proposal up or down next Wednesday.