LVCVA signs the purchase of the Las Vegas monorail
The Las Vegas Convention and Visitors Authority on Tuesday approved the purchase of the financially distressed Las Vegas monorail, closed since March with the start of the coronavirus pandemic.
The approval follows Tuesday morning action by the Clark County Commission approving a transfer of the monorail franchise rights. The deal is worth $ 24.2 million, according to LVCVA CEO and chairman Steve Hill.
âThe Monorail is in a position where it has to file for bankruptcy,â Hill said. âThis process will be part of a bankruptcy proceeding. It will end with an auction. â¦ It is a significant sum of money, but for the LVCVA, it is not a large sum.
Hill said the monorail is in a bad position today because of COVID-19. He had been able to generate about $ 2.5 million a year in cash previously before maintenance and debt payments. As Las Vegas recovers, Hill said LVCVA will be able to do so as well. He will be able to operate the monorail more efficiently and generate more cash, he said.
The heaviest use of the monorail was transporting visitors to midweek conventions. It carries five million passengers a year and about a third of convention attendees take it, Hill told the LVCVA board of directors.
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“Putting those five million people on the streets when the city is healthy again would exacerbate a congestion problem that we’ve all been struggling to overcome for decades,” Hill said. âOur customers reached out to us and made it very clear to us that the monorail is an important part of their experience when they are here in Vegas. They have made it clear that they want this transportation option to continue. “
The LVCVA would take the system out of service if it stops working, Hill said. Its lifespan is eight to ten years longer, he said. LVCVA will not invest hundreds of millions of dollars in its preservation or expansion, he said.
âIf we are not able to research alternatives to the monorail during that eight to ten year period, we could go several years without the monorail or a competing option,â Hill said. âOverseeing this transition is an important part of what we can do for Las Vegas.