Paying Off A Stadium Debt: How Much Does Las Vegas Still Owe For Its Share Of Building Raiders Stadium? (Think Ten Figures)
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By Alan Snel, LVSportsBiz.com Publisher/Writer
They each have their cult followings, the rodeo fans who descend on Las Vegas once a year for the Super Bowl of rodeos at Thomas & Mack Center east of the Strip. National Finals Rodeo (NFR) will draw 17,000 a night for 10 days straight until Dec. 10.
And the ardent college football followers of Southern Cal and Utah, two Pac-12 football programs facing off at Allegiant Stadium on the west side of the Strip. Friday’s Pac-12 football championship game will have more than 60,000 rabid fans packed inside the domed venue run by the NFL Raiders.
It’s a convergence of Old and New Las Vegas, the horse town Vegas with a rodeo playing out in ol’ reliable Thomas & Mack and the fast-paced, sports-crazed Vegas with college football blueblood USC visiting a black-veneered, glamorous NFL stadium.
What financially binds these two contrasting sports events is the fact that so many of the people shelling out the money to enter each venue are visitors paying for Las Vegas area hotel rooms. The tourism factor cannot be overstated because a hotel room tax approved by the state in 2016 is raising the money that Southern Nevada owes for its share of building Allegiant Stadium.
Here are the stark facts.
Southern Nevada contributed $750 million toward the $1.4 billion construction budget to build the Raiders stadium. The $1.4 billion construction budget was the biggest chunk of an overall stadium project budget of nearly $2 billion.
How much is the debt service on the public’s $750 million contribution? It’s $1,354,215,804 — a billion-dollar-plus debt being paid off over 30 years.
How much has Southern Nevada raised since the hotel room tax of 88 cents a room night began in March 2017? The public has generated 224.6 million in hotel room tax money through June.
Las Vegas, you’re still on the hook to raise more than $1 billion during the next quarter-century to pay off your share of building the NFL stadium of your dreams.
Here’s a look at the latest hotel room tax revenue numbers:
As long as hotel occupancy rates stay up, the bed tax dollars will roll in. But the COVID-19 pandemic that shut down the Strip for two months in 2020 and slashed into hotel occupancy rates forced Clark County to not once but twice tap into contingency funds to pay off debt repayment bills.
Hotel room tax revenues have rebounded to pre-pandemic levels so as long as no pandemics or economic collapses strike the U.S., the debt payments should be realized.
One day if the stadium bonds are eventually paid off, the hotel room tax rate is reduced to 0.125 percent, with the revenue used to fund Las Vegas Stadium Authority operating expenses and capital improvements for the stadium, according to Senate Bill 1, the enabling legislation that cleared the path for the Raiders’ stadium.
