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By Alan Snel, LVSportsBiz.com Publisher/Writer
Well, here we go again.
Another big-league sports team from Oakland will be schmoozing with state lawmakers, elected officials and Las Vegas big hitters to see if there’s political support for earmarking public dollars to help build a palatial sports venue along the Strip corridor.
The NFL Raiders scored the stadium subsidy mother lode in 2016 when former Gov. Brian Sandoval signed the stadium hotel room tax into law that plowed $750 million of public money toward the construction of a domed, 62,000-seat stadium on the west side of I-15 across from Mandalay Bay.
Now, Major League Baseball’s Oakland Athletics will be knocking at lawmakers’ doors to see if they, like the Raiders, can receive government money to help build a venue in metro Las Vegas. The A’s are romancing two cities — Oakland where they have a baseball park planned as part of a $12 billion waterfront development project in Oakland. And Las Vegas where the team is looking at the Tropicana, Rio and Festival Grounds (across from Sahara) sites in the Strip corridor.
LVSportsBiz.com has 10 things you need to know about stadium subsidies and the Athletics’ try at public money for a Las Vegas ballpark:
One: In the beginning of sports leagues, owners of professional teams did not ask for tax money to build their venues. Then they realized they could receive free money from the government for everything from land to construction to tax breaks. And the stadium arms race began in the 1950s.
Second: The debate about stadium subsidies is a non-partisan issue. Some Republicans and Democrats support public money for team venues. Some on both sides of the aisle oppose them. You just never know. Few public policy topics are fashioned more out of emotions and less out of political ideology than giving public money to billionaire team owners to help build stadiums.
Third: Teams and their supporters such as tourism/chamber advocates crow about financial benefits of subsidized stadiums and hire consultants to generate studies to back their claims. But many sports economists say these boosterism studies, consultants and statements exaggerate stadium economic benefits because they fail to measure net spending increases. They note sports event visitors sometimes just displace tourists who stay away from stadiums that host professional sports games and big high-security, high-traffic events like Super Bowls.
Four: The Athletics’ lobbyists in Nevada will study a buffet of stadium funding sources and see the extent to which lawmakers and elected officials will support them. The public funding for the Raiders stadium construction relies on a hotel room tax of 88 cents on every $100 that generates anywhere from $3.3 million to $5.3 million a month to help pay off the public’s $1 billion debt over 30 years for the $750 million construction subsidy.
Five: Major League Baseball supports the Oakland Athletics looking at Las Vegas as a potential home for the A’s, but MLB wants the Las Vegas market/Nevada to show it wants a team. What does that mean? It means MLB wants some level of public dollars to be spent on building a new ballpark. MLB wants more than just words of support. The Lords of Baseball want some public money spent on a baseball venue to show Las Vegas truly wants an MLB team. MLB to Las Vegas: Show us the stadium money.
Six: Team lobbyists and elected officials who like sports and support subsidized stadiums can be creative in the way they pitch their stadium welfare proposals. They can propose deals where a funding source can help pay for both a stadium and a politically more palatable item like schools. For example, the Tampa Bay Buccaneers owner packaged an NFL stadium along with schools, jails and roads under a sales tax increase public vote that was approved by Tampa-area voters. They can also include a stadium district and use sales tax revenues from items sold in the district for stadium construction.
Seven: Lobbyists/subsidy supporters can also package deals where they use multiple funding sources at various government levels to help pay for a baseball park. For example, the Seattle Mariners baseball park was publicly funded with money that came from the state of Washington in the form of a sales tax credit and money from a sports lottery and baseball park license plate; a local King County sales tax on food, beverages and rental cars; and an admission tax on Mariners game tickets. Here in Nevada, sports teams were successful in exempting themselves from a live entertainment tax of nine percent.
Eight: Another option is a multi-county tax district for a stadium that is used by fans in all the counties. For example, the Colorado Legislature approved a six-county sales tax district that included city/county of Denver and five neighboring counties that generated revenues to pay for venues for the MLB Rockies and NFL Broncos. This requires cooperation from elected officials across jurisdictions — a tricky proposition.
Nine: The Athletics will need to rely on relationships in Carson City and in Las Vegas to secure any public ballpark money. The team has enlisted lawyer Christopher Kaempfer, a partner with Kaempfer Crowell in Las Vegas, to work on the ballpark project. You might recall Kaempfer once had an ownership stake in the former Las Vegas 51s, the Triple-A team that was re-branded into the Aviators, the Oakland Athletics’ affiliate playing at Las Vegas Ballpark. Kaempfer’s group sold its 50 percent share to Aviators owner Howard Hughes Corporation — the Summerlin master developer that received $80 million in public money from the Las Vegas Convention and Visitors Authority (LVCVA) in a naming rights deal that paid for more than half of the $150 million, 10,000-seat ballpark in Downtown Summerlin.
Ten: Let’s face it. The major hotel-casinos call the shots for Las Vegas’ biggest deals. The Raiders are here because the late Sheldon Adelson added his political support for the Raiders stadium hotel room tax and MGM Resorts International, the Strip’s biggest hotel owner, endorsed the $750 million stadium subsidy to help build the domed NFL stadium. The stadium has attracted more than just NFL games. But how much would a baseball park do that? And can a market of 2.3 million people — even with its 40 million annual visitors — support 81 MLB games played by a team that has limited regional appeal? The Athletics lobbyists face a big task to get the Strip’s most powerful players on board to back any public money deal for a ballpark.