The hotel tax is expected to raise $750 million for the NFL stadium’s construction.
The proposed Las Vegas football stadium is beginning to evolve into a different vision than originally envisioned, at least according to some of those involved in the project. Majestic Realty Company recently pulled out of the project, citing concerns about the direction it was heading.
This past week, Oakland Raiders owner Mark Davis showed he had a different time table than other members of the project.
Despite the many different personalities, the NFL stadium for Las Vegas appears as if it’s getting closer to approval. Though the final price tag and time of completion is likely to change, the underlying fact that the casino is going to be built no longer seems to be seriously in doubt.
Craig Cavileer Discusses Majestic’s Thinking
The Thursday before last, Craig Cavileer, the Executive CP of Majestic Realty Co., said his company had pulled out of the Las Vegas NFL stadium project. Cavileer said that it was clear to his company that the $1.9 billion stadium project was not longer the corporate project it was in the beginning, but instead a “legacy project” for Sheldon Adelson and his family. Majestic Realty seemed to have a complaint about the money being spent on the project, which increased from $1.5 billion to $1.9 billion in just the past few months.
Originally, Sheldon Adelson committed $150 million to the project, but he and his group of investors have committed $650 million. Oakland Raiders owner Mark Davis and the NFL have pledged $500 million, while the remaining $750 million are going to come from the public.
Hotel Tax Needed Passage
The public contribution is going to come from a hotel tax revenue. To make that happen, Nevada lawmakers would need to increase the hotel tax on the Las Vegas Strip by 0.88%. At the moment, the tax rate is 12%. The twelve percent margin at the moment funds tourism improvement costs, the Nevada school system, and other services.
Majestic Realty has been a part of talks for a football stadium project since 2011, when it proposed an on-campus football stadium for the University of Nevada Las Vegas. Over time, the project has morphed into building an NFL-ready football stadium which also would house UNLV games. While Majestic Realty representatives have been a part of public meetings at various times throughout the process, it is said their executives have been absent from those deliberations in recent times, according to Las Vegas news sources.
Public Funding Approved
On September 15, the Southern Nevada Tourism Infrastructure Committee approved the public funding proposal. The plan, which has Las Vegas Strip hotels making the largest single contribution to the stadium’s building costs, has been controversial from the start. Voters are never happy about being asked to fund stadiums, when the structure eventually is going to be owned by wealthy football owners and their investment group.
In the case of the Las Vegas football stadium, criticism has focused on Sheldon Adelson. Though Adelson is seen as one of a group of investors, his critics point to his estimated $32 billion as a sign he could finance the stadium himself. Sheldon Adelson’s $32 billion, according to the latest Forbes wealth rankings, would make him the 14th-wealthiest American. Having the public fund a proposal which would channel more wealth to one of the richest Americans has been offensive to some of the critics of the plan, because they believe Adelson could fund construction himself.
Oakland Raiders’s Chances of Moving
For the plan to succeed, the Oakland Raiders are going to need approval from a three-fourths majority of NFL owners. That same ownership declined to approve the Raiders’ move from O.com Stadium in Oakland to a new stadium in Los Angeles. Instead, the Los Angeles Raiders (then located in St. Louis) and the San Diego Chargers were approved for a move to the Los Angeles metropolitan area.
It appears that Mark Davis has key support in his plan to move to Las Vegas. Dallas Cowboys owner Jerry Jones and New England Patriots owner Robert Kraft each have spoken publicly about their support of Davis. As two of the most influential NFL owners, it is thought their support would carry weight among their fellow owners.
NFL Commissioner’s Concerns about Gambling
NFL Commissioner Roger Goodell has not given his full approval yet, though he has signaled that he would not oppose a move to Las Vegas. American sports leagues traditionally have opposed locating a team in the United States’ gambling capital. They have been concerned that such proximity to America’s sportsbook would undermine the integrity of the game in the eyes of the American public. The NHL agreed to locate a franchise to Las Vegas in the past year, while the commissioners of the NBA and Major League Baseball each have suggested their minds are open to legalizing sports betting at the federal level of government.
Mark Davis recently suggested his plan was to keep the Oakland Raiders in the O.com Stadium throughout the 2017 and 2018 years, which came as a surprise to some. Davis has a one-year 2016 lease with the stadium, though he has the option on two subsequent one-year leases, if he so chooses. Many assumed he would remain in Oakland this year, then move the team in the offseason, even if the stadium was not completed. In that scenario, the Raiders would have played at the current UNLV stadium, though that venue is seen as inadequate for pro football now.
