By Alan Snel, LVSportsBiz.com Publisher-Writer
Congratulations, Las Vegas.
You are only $1,178,161,041 away from paying off all the principal and interest on your debt to help the NFL Raiders build their palatial domed stadium that triggered the value of the Raiders franchise to skyrocket to $6.2 billion.
I know. You’ve been told over and over again that you contributed $750 million to the $1.4 billion stadium construction budget. The construction budget, obviously, was the biggest chunk of the NFL stadium project’s overall cost of about $2 billion. (The Raiders spent the other $600 million on costs like land purchases, professional services and equipment.)
LVSportsBiz.com Friday took at a look at the Clark County debt service for the public share of the Raiders stadium construction.
And Las Vegas, you’re paying way more than $750 million, which was the designated amount in the state bill authorizing the Raiders stadium subsidy back in 2016.
During the 30-year debt service repayment period from 2019 to 2048, Clark County is on the hook for a total of — drumroll, please — $1,354,215,804. That’s about $46 million less than the Raiders stadium construction budget of $1.4 billion.
Metro Las Vegas is paying way more than $750 million on the Raiders stadium because Southern Nevada has to pay not just the principal but also the interest on the bonds. And if you have a home mortgage, you know all about principal and interest.
Clark County sold the bonds for the Las Vegas Stadium Authority because the Raiders’ Allegiant Stadium is in the county and the county is the bond-selling agent for the stadium authority.
So, the county keeps track of the annual debt service payments. Take a look.
Thanks to a state-approved hotel room tax and the monthly revenues it generates, Clark County has paid off $176,054,763 from 2019-2023. During those first five years, the county shaved $12,995,000 off the total principal, while paying a whopping $163,059,763 in interest.
Add the principal and interest and Las Vegas, you have lowered your debt by $176,054,763.
Then subtract five years of paying that principal and interest amount from the starting debt of more than $1.3 billion and you only have $1,178,161,041 to go.
The stadium authority board — chaired by the person who is also the CEO/president of the LVCVA tourism government agency, Steve Hill — relies on that hotel room tax to generate money to pay off the stadium construction debt.
In November 2020 and May 2021, Clark County had to tap the contingency funds to make more than $32 million in debt payments because of a shortfall in hotel room tax revenues caused by the COVID-19 pandemic.
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But things are much better now.
At a recent stadium board meeting, the hotel room tax revenues for February 2024 were robust thanks to the Super Bowl being staged in Las Vegas Feb. 11. The hotel room tax money hit nearly $6.6 million in February, a monster increase from the $4.4 million for February 2023.
The costs of paying back bonds and their interest came up during a stadium financing webinar held by the The Journalist’s Resource at the Shorenstein Center on Media, Politics and Public Policy at Harvard Kennedy School. LVSportsBiz.com, a webinar panelist, suggested media include both the principal and the interest money amounts in reporting stories about stadium public financing because that’s what the public is responsible for paying when it comes to paying off the debt service.
Clark County is not expected to be done with paying off bond debts on stadiums because now the MLB Athletics want to build a $1.5 billion domed stadium on the Strip with $380 million of government assistance, which includes $120 million in Clark County bonds.
The county commissioners are expected to vote on the $120 million in stadium bonds in the first quarter of 2025, said Hill, who is the head of the LVCVA tourism agency, chairman of the Las Vegas Stadium Board and an A’s stadium subsidy backer who appeared before state legislative committees last year to voice his support for the state bill authorizing the $380 million stadium subsidy.