Proponents of the Las Vegas stadium proposal have claimed from the beginning that Nevada residents would not have to pay for it. The pitch says that it would be paid for entirely by tourists through a hotel tax. The stadium is nowhere near fruition, yet Nevadans are already footing the bill.
Special legislative sessions are not free
Nevada Governor Brian Sandoval called a special session of the Legislature. This required 63 legislators to travel to Carson City. A typical 120-day legislative session, held every other year, costs Nevadans an estimated $20 million, according to the Las Vegas Sun. Legislators are paid $146 per day plus a $140 per diem to cover meals, lodging and other travel expenses.
A special session in the Legislature is limited to 20 days by the Nevada Constitution. If the special session called by Governor Sandoval only convenes for 10 days, it would cost Nevada taxpayers about $1.6 million, based on the costs of a 120-day session. A full 20 days would cost taxpayers about $3.2 million.
Special session not only stadium cost absorbed by Nevada taxpayers
The Southern Nevada Tourism Infrastructure Committee met 16 times to discuss the stadium. The Nevada Department of Transportation initiated a traffic study on the two proposed sites near Russell Rd and I-15. The costs involved with these stadium-related tasks have yet to be disclosed.
There is also debate about how to fund road improvements around the proposed stadium. This need is not specifically funded in the bill.
Nevada taxpayer costs not addressed in proposals
Ignoring the initial costs to taxpayers, there are more issues created by the development of a Las Vegas stadium. The proposal by Sheldon Adelson and the Raiders states that one of two sites is under consideration.
One parcel is currently the Bali Hai Golf Course. That parcel pays roughly $391,000 per year in property taxes, according to Clark County records. The other proposed site is just east of I-15 and Russell Rd. Public records show that undeveloped land plot has an annual property tax payment of about $347,000.
The language of the Las Vegas stadium proposal turns either parcel into public land. That removes it from the tax roll. This would be equal to the demolition of 277 homes based on the average value in the housing market. This ignores the increase in value of both lots should it be acquired for the purpose of developing a stadium or comparable project.
Both lots under consideration for the stadium are essentially undeveloped. One is a golf course. The other is dirt.
Part of a property tax assessor’s duty is to determine the value of improvements. The construction value of the proposed Las Vegas stadium falls in the neighborhood of $1.6 billion. That is the assessed value of the entire Bellagio property. The Bellagio pays $15.95 million in property taxes annually, according to the Clark County assessor’s website.
Not only would Clark County lose nearly $400,000 a year in taxes currently paid on the proposed lots, the declaration of the stadium being public land would remove nearly $16 million in potential annual property tax levies if the property was developed commercially with a comparable investment.
Property taxes would not be the only tax loss for Nevada
The Las Vegas stadium would require tens, if not hundreds of millions of dollars in construction materials. All of these would be free of sales tax as state and local governments do not pay them. If just 20 percent of the proposed $1.9 billion stadium was raw materials, that amounts to $31 million in sales taxes lost at the current rate of 8.15 percent if the stadium was developed privately.
Project Requires $1.2 billion in bonds
The stadium would cost about $1.2 billion by the time it was paid off. This could adversely affect the county’s credit rating. That would force future bonds for projects that actually benefit the public to pay a higher interest rate.
Las Vegas stadium demolition costs paid by taxes
There will come a day when the proposed Las Vegas stadium is obsolete with no tenants. That topic has never been discussed. The demolition of the Astrodome would cost an estimated $29 million to implode. Meanwhile, the Houston landmark sits idle at an annual cost of $2 million to taxpayers.
The hotel tax has no sunset. That money would be used to demolish the structure while serving no benefit to the tourism industry or Clark County residents. There is no obligation by the investors to pay for the demolition after earning 100% of the revenues during the project’s life.
Police, fire and EMT costs
Property taxes are often based on the resources needed for the land use. Placing the Las Vegas stadium into public hands would remove all property taxation. At the same time, the use of the structure would command police, fire and rescue services. These would all be paid for by Clark County taxpayers.
There is a $4 million Metro subsidy in the bill. That money would only go to police after paying bonds, admin costs and a reserve fund.