‘No support’ from resort industry for funding monorail expansion
The long-planned extension of the Las Vegas Monorail to Mandalay Bay, which is near the Las Vegas Raiders stadium, and the construction of a new station near the Venetian, depend on a chain of events which seem less and less likely to materialize.
Monorail chairman and chief executive Curtis Myles told county commissioners earlier this month that financiers were seeking two commitments before funding the $172million project – one from the government for $135million dollars over 30 years, and the other from the resort industry for an undisclosed amount.
But are casino companies interested in raising funds to move tourists from one end of the Strip to the other?
“The answer to your question is no,” said Ron Reese of Las Vegas Sands, owner of the Palazzo, Venetian and Sands Expo Convention Center, all of which are expected to benefit from a new resort planned for expansion.
Boyd Gaming, which has no resorts that would directly benefit from the expansion, does not intend to participate in the funding, spokesman David Strow said.
The expansion would put tourists on the doorstep of two MGM resorts – Mandalay Bay and Luxor.
Does the gaming giant, which is cutting jobs to cut costs in response to shareholder demands, plan to help fund the expansion?
“I don’t know. I’m going to have to answer you,” MGM Resorts International spokeswoman Debra DeShong said.
“There is no support for this in the industry,” said a game insider with knowledge of the matter. Running. “Even at MGM.”
The Las Vegas Convention and Visitors Center was unable to cite any financial support pledged by the tourism industry.
Myles says financiers want buy-in in the coming weeks for the project, which is to be built and financed in two phases — $140 million for the Mandalay Bay leg and $32 million for a new station at the Venetian and the adjacent Madison Square Garden. Sphere.
“After this window closes, this particular capital is no longer available,” Myles told the commissioners. “If this capital is no longer available, it is very likely that we will not do either financing, because this lender also plans to participate in the larger financing as well.”
But the county commissioners, who agreed in 2017 to commit up to $4.5 million a year in council tax revenue (with the caveat that it will be reviewed every year) may be cold to the ears. eyes after a warning from their lawyer that the deal could leave the government liable in the event of default by Las Vegas Monorail, which filed for bankruptcy in 2010 when tourism plummeted during the Great Recession.
Are county commissioners willing to commit public funds without details of supposed industry buy-in?
“We’re talking about the equivalent of a bond that we could use for something else,” said commissioner Tick Segerblom, who called the county’s possible contribution an additional taxpayer commitment to the Las Vegas Raiders Stadium, which will located behind the Mandalay Bay. “It’s part of what we do to make the stadium work. I don’t know why we do it and not MGM.
Other commissioners did not respond to our request for comment.
Then-county commissioner Steve Sisolak, who is now governor, told voters about the project in a January 2018 newsletter:
“Several community stakeholders support the project, including MGM Resorts, Caesars Entertainment, Las Vegas Convention and Visitors Authority, Southern Nevada Regional Transportation Commission, and the Las Vegas Global Economic Alliance,” the newsletter said. Sisolak.
When asked if the cited support was financial, Sisolak spokeswoman Helen Kalla declined to answer, noting instead that the Sisolak newsletter article had been removed from a Las Vegas Sun story quoting Commissioner Larry Brown.
The planned 1.4-mile expansion and the addition of two stations are being touted as not only a boon for the 6 million convention-goers who visit Las Vegas each year, but also for football fans, who will be forced to visit. walk to Las Vegas stadium without parking. . The stadium is about a fifteen minute walk from Mandalay Bay,
Regarding the resort industry, Myles told the commissioners that he was “very confident that we will get the participation needed to secure the loan.”
LV Monorail spokeswoman Ingrid Reisman declined to say whether the industry had made financial commitments to the project and declined to provide the most recent ridership statistics. The latest numbers available on the Las Vegas Monorail website, which says it’s updated quarterly, are from 2017 and put ridership at less than 5 million that year.
Monorail revenues have consistently fallen several million dollars a year below forecasts. A study by BuroHappold Engineering indicates that the extension would increase annual ridership by at least 1.5 million people, according to the Las Vegas Monorail.
The extension would extend the monorail to eight stations along a five-mile stretch of SLS from the corner of Sahara and Las Vegas Boulevard to Mandalay Bay at the southern end of the Strip.