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December 10, 2017

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In Raiders stadium deal, sides still split over workforce, business goals

Image

Copyright 2017 LV Stadium Company, LLC

Rendering of the proposed Las Vegas Raiders Stadium.

Public policy that relies on the kindness of private business tilts power away from the people appointed to use it in their interest.

Welcome to the unenviable position of the Las Vegas Stadium Authority board as it works with the Raiders to craft a community benefits plan. It’s a document required of the team by the law that gave it $750 million of tax money, but not subject to approval by the government agency tasked with overseeing it.

Stadium authority officials and board members can ask for what they want included, and they have. The Raiders can choose to listen and cooperate, and they have as well.

Yet attached to the draft community benefits plan that came before the board on Nov. 9 after months of negotiation were private tensions rivaling those expressed separately by community groups throughout the summer. Dan Ventrelle, the Raiders executive vice president leading the discussion, sparred with Chairman Steve Hill and board members over whether the team’s offers extend far enough to hold up to public scrutiny through the life of the stadium.

While Raiders officials stressed their commitment to corporate citizenship, they used no subtlety in reminding board members of how state law is written.

“It’s not a plan that merits approval by a board or any other entity,” Ventrelle said.

Ventrelle said he had a large hand in drafting that legal definition, which was inserted into statute during the October 2016 special session of the Nevada Legislature.

Discussions on the plan continued last week as Raiders President Marc Badain traveled with Hill to Houston. They took the next step in their pitch to participate in the joint North American bid to host part of the 2026 FIFA World Cup in the team’s $1.8 billion, 65,000-seat stadium that broke ground Nov. 13.

Hill reported no significant progress on the benefits plan after the board meeting.

“We continued to talk about it,” Hill said. “We haven’t reached any conclusions yet. We’ll still work with them to get to that conclusion.”

Despite a great deal of progress on the plan, two outstanding issues hold up a blessing from the board that the Raiders continue to pursue despite no obligation to do so. Workforce hiring targets of 38 percent of total work hours in constructing the stadium and 55 percent of total work hours in operating it remain on the table.

Some board members also would like the team to commit to firm goals for the hiring of women- and minority-owned businesses, while the Raiders feel their offer to encourage the use of such entities suffices.

“It’s easier to judge the definition of what success is along those lines if you’ve kind of figured out that definition of success going into the effort,” Hill said of the authority’s request for numeric targets. “I understand completely where they’re coming from on this, but that’s been the discussion we have had so far.”

Badain and Ventrelle both point to the inclusion of two specific targets — the workforce percentages and the legally required use of at least 15 percent of small local businesses in constructing the stadium — as evidence of the team’s desire to meet its community obligations.

“We’re proud of the largest minority participation/involvement percentages in any community benefits plan or community benefits agreement in any stadium project in the country,” Badain said following the meeting.

This shortened exchange about whether the plan should include targets for specific business usage from the meeting captures the rift the sides hope to bridge.

Hill: “My concern is, if there’s not a goal, there are going to be some who feel you didn’t do enough.”

Ventrelle: “With all due respect to Mr. (Ken) Evans’ comment about the necessity for metrics, there are more metrics in this community benefit plan than in any other stadium community benefit plan that exists, so that would be the greatest possible effort that could be made.”

Hill: “Mr. Ventrelle, we don’t need to get into a semantics argument on that — I don’t think I would agree with that. I’m just saying on that particular point, because there aren’t goals in the current agreement — without a goal, I don’t know what adequate performance is and what inadequate performance is. That’s kind of the question.”

Ventrelle: “To imply that they’re passive or somehow not genuine obligations, I don’t think is a fair or honest reading of the document.”

Hill: “Your interpretation of my implications is inaccurate. I’m just asking a question.”

In the yearlong history of the stadium authority board, few public discussions generated conversation at a similar level of tension. That’s as much a credit on the sides’ ability to work well together on challenging issues as it is a reminder of how charged work on this plan has become.

“It was important that the board see where we are and have an opportunity to weigh in on all of the components of the plan,” Hill said following the Nov. 9 meeting. “Really, a lot of progress has been made over the past few weeks. We’ve closed a number of open issues. I do think that the Raiders portrayal of this as a very strong plan is accurate. We just have a couple of open issues left. We’d like to reach an agreement on the over the next month.”

The last two NFL stadiums built also included some form of community benefits plan to offset public investment and neighborhood disruption. In Atlanta, the foundation of Falcons owner Arthur Blank donated $20 million toward job training, new parks, youth leadership programs and homes for police officers willing to live in the troubled area of the new Mercedes-Benz Stadium, according to the New York Times.

The Falcons received $200 million in local room-tax money toward construction of the stadium, which opened earlier this year.

U.S. Bank Stadium in Minneapolis set the previous pace for workforce hiring targets. A document on the website of the Minnesota Sports Facilities Authority shows the state set a goal in 2012 for 32 percent of construction workers at U.S. Bank Stadium to be minorities and 6 percent women.

According to the Associated Press, the Vikings’ project bested the goal with 37 percent minority hiring and 9 percent women. Combining local and state investment, nearly $500 million in public money went toward that facility.

LVSA board member Bill Hornbuckle, the president for MGM Resorts International, worked on the construction of T-Mobile Arena, where the Vegas Golden Knights play. Hornbuckle feels the Raiders can meet the 38 and 55 percent targets, and likely should be able to exceed the latter target for workers after the stadium opens.

“Particularly including female, the goal, while commendable, is simply not that difficult and frankly we blow that goal away,” Hornbuckle said. “It doesn’t mean that’s not a worthy goal — we don’t run a stadium, we run an arena. There might be a different complexion to that.”

The sides have agreed to oversight and enforcement of the plan by a seven-member panel including four government-appointed and three developer-appointed representatives. General contractors Mortenson and McCarthy will be responsible for collecting data from their subcontractors to ensure that hiring targets are met. Those reports will be made to the panel on a quarterly basis during construction, which is expected to last until July 2020.

Mortenson community benefits director Lynn Littlejohn reported at the meeting that of the 15 bids awarded thus far, eight have been to small businesses, two of which are women- or minority-owned firms.

The board next meets Dec. 14, at which time Hill anticipates the community benefits plan again will appear on the agenda.