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August 21, 2017

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Why sense of urgency must drive rest of negotiations ahead of stadium construction

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John Locher / AP

A man celebrates holding a Raiders sign, Monday, March 27, 2017, in Las Vegas. NFL team owners approved the move of the Raiders to Las Vegas in a vote at an NFL football annual meeting in Phoenix.

The Oakland Raiders will go on the clock in the National Football League Draft in six days, but the ticking on their move to Las Vegas already sounds like the "60 Minutes" stopwatch to local officials.

Thursday’s two-hour meeting of the Las Vegas Stadium Authority Board highlighted just how much work needs to be packed into the next 40 months before the Las Vegas Raiders play their first game in their new $1.9 billion stadium.

A revised draft lease including free rent for the Raiders occupied much of the discussion, but that document is one of a dozen agreements that will need to be reached in the next few months. The remaining contracts are in nascent stages compared to the lease, which board chairman Steve Hill called 75 percent done earlier this week.

“We’re looking at a long process,” said Mark Arnold of Andrews Kurth Kenyon LLP, the authority’s contracted law firm. “The motto of my firm is ‘straight talk is good business,’ so I’ve got to tell you that it could take a good three to four to five months to pull (all of the agreements) together.”

The high end of that time frame extends almost to October. With a 32-month construction calendar slated to begin by the end of the year at the team’s preferred 62-acre site near Russell Road and Interstate 15, each piece of the leadup must align perfectly to keep on track for the Raiders to play their first game in the 65,000-seat domed facility by the 2020 season.

“If we get past October, that’s probably problematic,” Hill said.

At the same time the authority board met, Clark County Commissioner Steve Sisolak took part in a separate development meeting in the same building involving close to 70 people with roles in the construction of the stadium. The tight construction schedule offers no relief if the paperwork takes longer than anticipated.

“The complexity of it, if anything, was surprising,” Sisolak said. “This can’t come in behind. If it comes in behind, they have no place to play.”

The authority board will meet again on May 11 with a stated goal of ironing out remaining issues with the lease, but that could prove ambitious given that board members only received copies of the most recent draft for review at Thursday’s meeting. Arnold said the current draft is either the 11th or 12th exchanged between the authority and the Raiders.

The two sides primarily have met via conference call and have had one face-to-face negotiations in the past three months.

“I think it’s been fair on both sides,” Raiders President Marc Badain said. “I think there’s been challenges presented by both sides. There’s going to be some contentious issues but it’s a negotiation — it should stay in private.”

Jeremy Aguero of Applied Analysis, the board’s retained staff firm, outlined the three key considerations of the lease from the authority’s point of view: long-term preservation of the stadium as an asset, maximization of stadium revenue (“largely the number of butts in seats”), and ensuring UNLV’s interest in its football team using the facility.

UNLV representatives wondered about their place as a co-tenant of the stadium when they saw the initial lease draft submitted by the Raiders in January, but Hill and Arnold both said the team is working well toward making sure the Rebels feel at home.

“Some of what the concern was in January was based on misunderstanding,” Hill said. “A lot of that has been worked out.”

Deadline pressure did not prevent a few moments of celebration at the meeting. Badain informed the board that close to 46,000 personal seat license deposits have been collected by the Raiders, including half that amount on the first day of sales. Days after receiving NFL approval last month to move to Las Vegas in 2020, the team began soliciting $100 deposits toward personal seat licenses that will be required before fans can purchase season tickets for the Las Vegas Raiders.

Each $100 license deposit covers one household and could account for multiple tickets, meaning the team appears on track to be able to sell more than enough PSLs and season tickets to fill the 65,000-seat domed stadium.

“The response was overwhelming,” Badain said. “It was pretty exciting for all of us just to see the first-day response, and then it’s continued.”

Badain also told the board the team will announce picks in the National Football League draft from the “Welcome to Las Vegas” sign on the south Strip on Saturday, April 29. That is the third and final day of the draft. The Raiders will hold a Thursday night party at the Fox Theater in Oakland on Thursday’s opening night of the draft.

The welcome-sign event will be the first official team celebration in Southern Nevada as the Raiders begin a delicate long-term balance between fans in the Bay Area and Las Vegas.

“Right now, we’re the Oakland Raiders and we’re going to remain in that community while establishing an identity here as well,” Badain said. “It’s important to us, it’s important to (Raiders owner) Mark (Davis) and we’ll continue to do that. That’s why we’re hosting the Thursday event there like we have every single year.”

The board also reviewed a tentative budget for the 2017-18 fiscal year at the meeting. That budget anticipates nearly $50 million in revenue raised by the room tax authorized by the Nevada Legislature in October to fund the public component of the stadium financing. Sisolak revealed Wednesday that the tax generated more than $4.6 million in its first month of collection in March, slightly besting initial projections.

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