Monorail files for bankruptcy in connection with the acquisition of LVCVA
The Las Vegas Monorail Co. has filed for Chapter 11 bankruptcy, according to a statement released Monday.
President and CEO Curtis Myles said in the statement that the monorail has not been able to reopen since it closed in March due to the COVID-19 pandemic.
“Accordingly, it is in the best interest of the Las Vegas Monorail Company to file for bankruptcy and effect a sale of the assets of the system to a party who intends to keep the system in operation and to ensure that the mobility benefits provided by the Monorail continue during conventions, events and throughout the year, âMyles said in the release.
The company’s board of directors has cleared the filing, which is part of the company’s sale agreement with the Las Vegas Convention and Visitors Authority, the statement said.
LVCVA Chairman and CEO Steve Hill said his agency’s acquisition of the monorail franchise would benefit transportation along the Corridor Strip as the monorail company holds a non-compete designation that would prevent the operation of future public transport systems.
The Boring Co., created by entrepreneur Elon Musk, is building a mile-long passenger transportation system under the Las Vegas Convention Center to transport conventioneers from one end of the Convention Center campus to the other.
The system, a dual-tunnel passage used by Tesla vehicles in autonomous driving mode, is weeks away from testing. Tesla is another of Musk’s businesses, and the Convention Center’s proposal would use vehicles on Tesla chassis, some carrying up to 16 passengers at a time.
Boring Co. officials hope to use the people carrier as a demonstration of the technology, and they hope to build a similar operation to serve the complex’s corridor, Allegiant Stadium and McCarran International Airport.
Wynn Resorts Ltd. and Genting Group’s Resorts World Las Vegas have already signed up to have their own Boring Co. tunnels transporting customers from their respective hotels to the Convention Center.
Transfer of rights
Clark County’s role in the agreement involves the transfer of franchise rights to LVCVA.
One of the conditions for approving the transfer is that LVCVA may not incur or spend income for the payment of any operating subsidy or any capital improvement exceeding 3% of LVCVA’s budgeted operating income for that purpose. fiscal year, not to exceed $ 10 million. per year, without first obtaining the approval of the committee.
If the LVCVA takes over the franchise contract, it will assume the obligation to demolish the system in the event of failure. If the LVCVA closes the escrow on the agreement, the county will transfer the money remaining in a county-owned sanitation fund to the LVCVA.
A Clark County spokesperson said last week there was $ 6.76 million in the remediation fund.
But Las Vegas Mayor Carolyn Goodman, a member of the LVCVA board of directors, suggested on July 14 that MGM Resorts International acquire the system so that it could expand it from the south end of the monorail to MGM Grand in Mandalay Bay, where a new station has been proposed. The new Mandalay Bay endpoint would be within walking distance of Allegiant Stadium.
âNow is not the time to spend money,â Goodman said, noting that LVCVA has had to lay off or leave employees on leave during the pandemic and that state government health guidelines and security have banned Las Vegas from hosting conventions or trade shows. .
She also said she was disappointed that despite previous plans, the monorail never had enough financial success to expand to McCarran or downtown Las Vegas.