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October 16, 2017

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What that $100 Raiders deposit actually gets you

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Courtesy of MANICA Architecture

A look at the proposed $1.9 billion domed football stadium for the Oakland Raiders and UNLV football in Las Vegas.

That Las Vegas Raiders season-ticket deposit you plunked down does not go toward your season tickets.

No, your $100 reserves only the chance to buy a license to purchase those season tickets. Your money actually helps the Raiders pay their portion toward the new $1.9 billion stadium through a system of personal seat licenses (PSL) that provide the right to buy tickets instead of the tickets themselves.

The Raiders launched a PSL deposit drive days after last week’s approval by NFL franchise owners of the team’s move to Las Vegas in 2020. Raiders spokesman Will Kiss said this week the team will not release updates on the progress of that effort and declined comment.

Not all of the stadium’s expected 65,000 seats will be subject to a PSL, but buying a season ticket will not be possible without first buying a license. The setup mirrors that of recently constructed stadiums in Santa Clara, Calif., Minneapolis and Atlanta, and the use of the PSL dates to at least the mid-’80s, though its exact origin is unclear.

The team must contribute $500 million beyond its $650 million loan from Bank of America toward the stadium. The NFL will provide $200 million through a loan program earmarked for stadium construction, and the Raiders plan to make up the remaining $300 million through a combination of PSL sales, naming rights and sponsorships. If the Raiders come up short on PSL sales, they are responsible for covering the shortfall in their stadium contribution.

Your $100 does not guarantee a PSL, as the team could take in more deposits than it has seats available. If that happens, the Raiders will add your name to a waiting list or give back your deposit.

Putting down your $100 marker should provide each household the chance to buy PSLs likely to range in price from a few hundred dollars in the upper deck well into five-figure territory for premium club seating on the 50-yard line. That process is not expected to begin for quite some time as stadium plans and site selection are not yet completed.

Both the Vikings and Falcons sold their cheapest PSL for $500. The Vikings sold out their allotment of stadium builder’s licenses — another common term for PSLs — and created a waiting list that requires a $100 deposit. Atlanta’s sale continues, and the team recently reduced the price of hundreds of licenses down to $500 after selling out its initial allotment at that price and watching higher-priced inventory sales stagnate.

Teams know this process can stretch well into the thousands of dollars for even decent football tickets and consequently provide a financing option. Atlanta’s PSL arrangement requires a down payment of 40 percent and then annual payments on the remaining 60 percent over nine years at 8.5 percent annual interest.

Once you buy a license for each seat, you then can pick up season tickets at whatever price the Raiders eventually set. That will cover eight regular-season, two preseason games and first crack at playoff tickets through the AFC Championship. What else you get from your license will be up to the Raiders and their stadium events company.

Some PSL structures allow license holders the first chance to purchase tickets to other stadium events such as concerts and soccer matches. The big stuff likely will be off the table, though, as ticket inventory for the Super Bowl and potential collegiate bowl championship games are tightly controlled by their sponsoring entities. On their website, the Raiders say a PSL “will secure your right to purchase season tickets to Raiders games and other events at the new Las Vegas Stadium.”

Las Vegas Stadium Authority board chairman Steve Hill said Thursday that the Stadium Authority and the team will formulate a separate PSL agreement. That document will spell out the terms of how the Stadium Authority — which ultimately controls the licenses because it will own the stadium — will sell the PSLs to fans. The money will go toward the construction of the stadium, which is expected to open in time for the 2020 NFL season.

The Stadium Authority cannot collect any funds until that agreement is enacted. Hill said the Raiders might eventually give back the $100 deposits and allow people to purchase the actual seat license through the LVSA in priority order from the deposit list.

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