[Editor's note] Hello and welcome to Friday's ClearCast!
The whole Las Vegas Valley is discussing the Las Vegas Raiders stadium proposal, but there are still a lot of questions out there about bias1)The LVRJ is owned by the same person trying to acquire the stadium.
Our own Jordan Flake, Esq., although excited at the prospect of a NFL team, is concerned about the finances of the Raiders stadium as a passionate Nevadan.
Mr. Flake was kind enough to give me a few minutes of his time so that these concerns will be made public. He, like you, is worried about Nevada taxpayers.
I have gone through the transcript and added the appropriate links so you may follow along.
Thanks for watching! Have a great weekend.
-Brian
Transcript:
Hello. I'm Jordan Flake with Clearcast. On this Clearcast today, we want to talk about something really interesting, I think. It's this Raider's stadium that they're proposing to build here in Las Vegas. As you can hopefully see, it's a pretty good-looking stadium and it comes with a price tag of 1.9 billion dollars.
That's right, 1.9 billion dollars is what they're projecting for the cost. I just want to talk about this for a second. I'm really excited to get any opinions of any of our viewers or listeners. First of all, let me just say, I look at this and my natural inclination is to say that's cool.
That's great. I want an NFL team in Las Vegas.
Not a huge Raiders fan2)kidding Raider nation!, but I figure I can learn to somehow become a Raider's fan, but there's still some, as always, there's still some lingering concerns and questions in the background.
Obviously, the first one is where are we going to come up 1.9 billion dollars, and what are some of the concerns swirling around that? What about maintaining it? How about is this what people really want here in Las Vegas?
Is it something that the public is really standing behind? First of all, one of the concerns is that the private investors here have, which include the Adelson's and the Raiders themselves, the Raiders organization, they basically came to Las Vegas and said, "You want us, the Raider's here in Las Vegas?
Okay, fine, Nevada. Give us 750 million dollars." That's basically what they're demanding. "750 million or we won't even, essentially, we won't even consider it," and the 750 million goes towards creating the stadium.
The proposal for getting the 750 million is to increase the, what is the name, Brian? Brian's here.
Brian: Resort tax.
Jordan Flake: Resort tax, yes. Thanks. The resort tax right now is 12.5% of whatever a guest pays for their room. They want to increase that by .8 essentially, so that would make it 13.3 resort tax. That might not seem like a big deal because a lot of residents here in Nevada aren't the ones paying these resort taxes.
They're the out of towners who come to Nevada and they just stay in the hotels, but there are two concerns.
Is This How We Want the Resort Tax Revenue Spent?
One is we already have a pretty high resort tax.
One of the highest in the nation is Oregon at about 14% for every room, and it's like, man, does Las Vegas want to be like, "Oh, hey, sorry, last year's resort tax was 12.5. This year's resort tax is 13.3. Go Raiders." You know what I mean?
It's a little bit in question whether or not that will disincentivize guests from coming to Las Vegas. I don't know.
I feel like people coming to Las Vegas are so focused in on partying that they're not really going to get too scared away by the .8% increase, but we do have to keep in mind that we're competing with other gambling destinations throughout the world at this point and we have to make sure that we're a reasonable place to visit.
Here's my real concern with increasing the 12.5% to 13.3% or whatever it would be, is that it really doesn't give us very much more room to increase that if we really needed it for something else.
Imagine that there was some kind of a statewide emergency that needs to and the state incurs a lot of debt that needs to get repaid in response to a statewide emergency. Imagine we have some other serious budget crisis in Nevada. Then we can't then very easily ... We could take it and we could take that 12.5 and bump it up to 13 or even 13.3, but we can't very easily once it's at 13.3 bump it up to 14 or 14.5 without really putting a strain on the marketability of the Las Vegas brand.
Think about what we're doing here is we're potentially incurring some taxation type costs, for what? For the entertainment that would be a Raiders franchise. Not a traditionally super winning team recently, of course.3)Now if the Broncos are interested..
That being said, this is a public and private venture.
The public would have that 750 million dollar stake in the stadium. It's not like the investors are hopefully going to get the full benefit of it.
That's obviously another concern is the investors are very savvy and we hope, and that's one of the things we have to be wary of is that they're taking advantage of the public funds to structure the deal in a way that would just enrich themselves, so that's obviously another concern.
Stadium Maintenance Concerns
More concerns, what if we put up the 750 million as taxpayers, these would be the resort tax, and then they just say, "Oh, we need more money."
What protections are in this contract and this building of the stadium contract that prevent them from just all of a sudden saying that they need more money or how about what happened to Quebec City in Canada?
In Quebec City, they built a stadium so that an NHL team would come, and you're scrolling through your NHL knowledge, and it turns out that no hockey team actually came, so they just have this really beautiful multi-million dollar stadium in Quebec City, but they don't really have any NHL team that would go and play in that stadium, so now they're having to pay maintenance costs for this stadium and find other uses for it, and they just didn't get the promised benefit.
What if something like that happened here? We build a stadium and the Raiders, for whatever reasons, find a loophole and decide not to come, or maybe one of the other California cities swoops in and outbids us?
We're just not sure.
Does Popular Opinion Matter?
One other issue is just how do people actually feel about this? Like I said earlier, my tendency is just to be like, "Oh, Raiders, cool. A football team. Yeah. In Las Vegas. I want it."
They did a poll here, a Rasmussen poll, and it turns out that 55% of Clark County voters are actually against funding the stadium and only 35% are in favor of funding the stadium.
This reminds us of what happened in Cobb County, which is a county in Atlanta, with respect to the Braves stadium. The chairman, Tim Lee, the Cobb County chairman didn't really pass this by the voters before he tried to use taxes to fund 500 million dollars in a stadium for the Braves in Cobb County, and he, of course, did not win his next election.
One of the options here that our public officials should consider is actually just putting this to a vote. We have some time. We can get it on the ballot4)Unfortunately, this option is not being considered. Let everybody vote.
If they want to put up the 750 million and raise the resort tax and bring in an NFL team, then so be it.
Yay, democracy!
Anyway, those are just some of the concerns and considerations. I've just barely scraped the surface.
As always, I'd be very interested to hear what you have to say about the stadium, about the Raiders franchise, about whether or not public funds should be used to fund this public/private venture.
Definitely reach out to us on our blog, on our Facebook page, on our Twitter, and just let us know. Again, if you need any help with any type of legal issue, please feel free to call Clear Counsel Law Group. We'd be happy to assist you.
Thank you so much for joining us for Clearcast today.
