Las Vegas announces new financing plan for proposed stadium

By Conor Shine

Published Thursday, Sept. 25, 2014 | 5:25 p.m.

Updated Thursday, Sept. 25, 2014 | 8:05 p.m.

Las Vegas officially unveiled a new financing plan tonight for a proposed $200 million downtown soccer stadium that would shift much of the project’s risk to private developers.

The major change will push $69 million in debt from the city to the development partnership of Findlay Sports and Entertainment and Baltimore-based Cordish Cos.

Mayor Carolyn Goodman, a vocal advocate for the stadium, hailed the new terms sheet as a major step toward making the project a reality. The plan was shown to city council members behind closed doors earlier this week.

A divided city council will vote on the financial terms at their Oct. 1 meeting.

Under a previous term sheet presented earlier this month, the city would have been responsible for issuing $115 million in bonds to help pay for construction. The bonds would have been paid off using a $3 million annual hotel room tax contribution from the city, rent from the soccer team and revenue from other events.

Some city council members and residents objected to that plan over concerns that the public would be on the hook for the full debt payment if the soccer team wasn’t successful.

The plan failed to gather enough support at the council’s Sept. 3 meeting, with three of the seven members in opposition and Councilwoman Lois Tarkanian undecided.

The new deal would reduce the city’s contribution to $46 million in bonds, which would still be paid down using $3 million in annual room tax collections. The remainder of the debt would be borrowed by the private developers, who would be responsible for covering any losses should the team underperform.

The change effectively caps the city’s risk at a $50 million contribution. The city would still be responsible for $14 million in improvements to roads and other infrastructure near the stadium, which was included in previous versions of the term sheet.

Also unchanged from the previous deal is a $44 million payment from the developers and $20 million in bonds that would be paid off with incremental sales tax revenue.

The new terms would see ownership of the stadium shift from the city to the private developers.

The city would still retain a minority interest in the stadium and the right to host city events at the stadium rent free, city officials said.

Tarkanian said Thursday night that the new terms are a “step in the right direction” but she still hasn’t decided whether to support the stadium.

Councilman Bob Coffin, who opposed the stadium project earlier this month, said he’s still not ready to support the deal and thinks the city can drive a harder bargain that shifts even more of the cost to the private developers.

If the four council members approve the new terms sheet next week, the developers would have until December to finalize a lease and a development agreement. Those agreements would need approval from either four or five council members, depending on how the city structures its bonds.

The deal is contingent on Las Vegas landing the final Major League Soccer expansion franchise, which several cities including Minneapolis and Sacramento are competing for.