What’s the hold up with the A’s move to Las Vegas? The devil is in the details… of Senate Bill 509.

I previously wrote about the A’s coming to Las Vegas and its potential impact on Las Vegas’ Triple-A team, the Las Vegas Aviators. Since then, much has changed. The “binding agreement” for Red Rock Resorts’ land just west of the Las Vegas Strip wasn’t so binding and the A’s now have a tentative agreement to establish a 30,000 seat-stadium on a 9-acre parcel on the current site of the Tropicana. Notwithstanding the new Tropicana agreement, there have been reports of A’s ownership and executives visiting other potential stadium sites, so things are far from settled.

As mentioned in my previous article, the A’s are eyeing a public-private partnership to fund the construction of its new stadium. Such a funding mechanism is not new to Nevada after it gave $750,000,000 to help fund the construction of Allegiant Stadium for the Raiders. There are loud voices for and against public-private sponsorship in stadium deals across the country, but the devil is in the details. As it relates to funding the A’s new stadium, those details lie in Senate Bill 509 (the “Bill”). This post will touch on the more interesting (if there is such a thing) aspects of the Bill.

Grounds for the Bill

Generally, the Bill allows for a method to finance the construction of the A’s new stadium, along with the necessary related infrastructure surrounding the project. The Bill speaks to Las Vegas’ tourism industry and need to develop certain venues to remain competitive and distinct, justifying the need for a public-private sponsorship to bring a Major League Baseball (“MLB”) team to Las Vegas.

Homelessness Fund

An interesting inclusion in the Bill is the creation of a resort corridor homelessness fund that will be co-managed by the MLB team (the A’s) and the Nevada Resort Association, the advocacy arm for Nevada’s gaming and resort industry. The goal of this fund will be to aid those who are at risk or currently experiencing homelessness.

The inclusion of this fund is a bit interesting. A homelessness fund being included in an MLB stadium financing bill could certainly be seen as way for the A’s and MLB to establish a bit of “good-will” with the legislators by showing that they are willing to invest in the community, while at the same time asking for community investment. ?

Small Local Businesses

The Bill also requires that 15% of the stadium project be subcontracted to small local businesses. Similar to the homelessness fund, this a is a “good-will” measure to ensure a percentage of the work goes to local community members and businesses.

Personal Seat Licenses (“PSL’s”)

Similar to other new stadiums across the country, the Bill accounts for the possibility of selling personal seat licenses to fund the construction of the stadium. For those unfamiliar, PSL’s are one-time fees that an individual must pay in order to have the right to purchase season tickets and have priority access to other ticketed events at the stadium (e.g., concerts).

PSL’s were also used in the construction of Allegiant Stadium and ranged from $500 to $75,000 per seat.

Sports and Entertainment Improvement District

In developing the stadium, Clark County will create a sports and entertainment improvement district to assist in the financing of the stadium project by allowing the revenue generated from the district to go towards paying back the funds Nevada and Clark County, are giving the A’s.

Stadium Site

Although there have been several “agreements” for the location of the stadium, the Bill is silent as to exact location and only requires that once a development agreement between MLB and Las Vegas Stadium Authority is agreed upon, that the site be identified.

The lack of specifics for an actual site surely means the location is still in flux. Whether the agreement is “binding” or “tentative”, we should not get too excited until dirt is being moved or a building imploded.

Public Funding

The main point of the Bill is how the stadium is going to be funded, more specifically, how much of the project is going to be subsidized by Nevada (and its taxpayers). Along with the tax incentives in the creation of the Sports and Entertainment Improvement District, the Bill allows for a $380,000 public financing package through county bonds and transferrable tax credits. The plan is for that amount to be paid back through revenue generated by the above mentioned Sports and Entertainment Improvement District.

What’s Next?

The hearing for the Bill was held on Memorial Day (interesting timing for inviting public comment …) and there was a plethora of voices for and against the project.

Those for the project advocated for the jobs it will create, increased national exposure, tourism impact, and the continuation to capitalize on Las Vegas branded as the “Greatest Arena on Earth” for sporting events and entertainment – if the A’s join the Raiders, Golden Knights, Aces, Desert Dogs, UFC, and Formula 1, each organization will continue shape and expand Las Vegas’ sports and entertainment footprint.

Those against the Bill, the A’s coming to Las Vegas, or the amount of public funding allocated for the stadium argued that the A’s should construct the stadium on their own dime, just as they promised to do in Oakland, and that Nevadans should not be on the hook for paying for a billionaire’s stadium. On top of that, those opposed cite other pressing issues in Nevada that public funds could be better spent on such as investment in our education, healthcare, or unemployment system.

Lastly, some point to the Golden Knights, whose stadium was privately funded, and the teams immediate success, community impact, an immediate return that nobody expected at the time. Since the Golden Knights were an expansion team, fans were understanding of the time needed to build a successful team, but they didn't have to wait that long with a Year 1 Stanley Cup Final appearance and now another one in Year 6 (#GoKnightsGo). The A’s on the other hand are at the bottom of the MLB standings, have the lowest payroll in the league, and averaging the lowest attendance in the MLB (what a trifecta). That said, the MLB and A’s have promised to invest in the team should they relocate to Las Vegas. We’ll keep an eye on this.

While both sides surely present sound and strong arguments, it’s tough to challenge the positive impact an MLB team would have on the Las Vegas market. While not homegrown like the Golden Knights or a storied franchise like the Raiders, an MLB team would undoubtedly add another reason for tourists to visit Las Vegas and create additional jobs for our local community.

The devil (in all sports deals such as this) is truly in the details. And the details of the public financing will always be up for debate and challenged by many on both sides. My lobbyist and legislative colleagues surely have their hands full in Carson City as they work towards a solution.