On May 24, several of Nevada’s most prominent officials and the Oakland Athletics (A’s) released a joint statement indicating that the two sides have reached a “tentative agreement” for a new public financing framework that would help fund the construction of the team’s proposed $1.5 billion stadium.
The announcement came after weeks of speculation following a rollercoaster series of events that saw the team back out of its original deal with Red Rock Resorts and instead partner with Bally’s Corp. to build its stadium on the site currently occupied by the Tropicana Las Vegas.
Public financing for the stadium has been a sticking point in negotiations from the beginning; under the original Red Rock deal, the team was requesting $500 million in public funds, to be generated by a special tax district set up around the stadium.
When the Bally’s deal was announced, that asking price had decreased to $395 million, but skepticism remained, given that Nevada officials already spent a whopping $750 million in public funds on the Raiders’ Allegiant Stadium just seven years ago.
Despite the fact that an agreement seems to have been reached, the recent release included few details about the arrangement, and did not mention exact figures that would be committed by Clark County and the state.
Additionally, a bill still needs to be brought in front of and passed by the state Legislature, which has less than two weeks remaining in its current session, adjourning June 5.
In the statement, Governor Joe Lombardo asserted that no more than one-fourth of the stadium’s construction costs are to be paid from public financing, which, based on the overall projected price of $1.5 billion, would indicate no more than $375 million.
Lombardo was also sure to note that that figure represents the third-lowest share of state money of all the 14 MLB stadiums built since 2000. He said the deal “follows months of negotiations between the state, the county, and the A’s, and I believe it gives us a tremendous opportunity to continue building on the professional sports infrastructure of southern Nevada.”
“Las Vegas is clearly a sports town, and Major League Baseball should be a part of it,” the governor said.
According to the Nevada Independent, sources close to the negotiations have indicated that the financing package would be at least $325 million, meaning that there is theoretically about $50 million in wiggle room until the governor’s ceiling is reached.
Per the Independent’s sources, $180 million of the package is to come from transferable tax credits, half of which would be refundable. This indicates that the team would be able to trade any unused credits for cash with the state.
$120 million would come from bonds issued by Clark County, but that amount is variable due to changes in interest rates. The county would also issue a 30-year property tax exemption along with a $25 million credit specifically earmarked for infrastructure costs.
The Independent’s source estimated the property tax exemption to be worth somewhere in the range of $55 million, which would bump the total consideration for the package to $380 million, slightly above Governor Lombardo’s one-fourth cutoff.
“This tentative agreement minimizes the risk to Nevada taxpayers in the most fiscally responsible manner,” Zach Conine, state treasurer, said in the joint statement. “I’m also pleased that this project will leverage the most private investment of any baseball stadium in the country.”
However, some officials, such as Assembly Speaker Steve Yeager and Senate Majority Leader Nicole Cannizzaro, were less committed, saying that they need to fully review the proposal before endorsing it.
Yeager said that “no commitment will be made until we have both evaluated the official proposal and received input from interested parties, including impacted community members,” and Cannizzaro said that she must “give this proposal a thorough vetting to fully explore the opportunity and its impacts on Southern Nevada,” per the Independent.
In addition to the finances, the relocation deal also must be approved by Major League Baseball by January 1. Due to the site’s proximity to Harry Reid International Airport, the Federal Aviation Administration (FAA) is also required to conduct various tests for the site.
In a statement to the Independent, an FAA spokesperson said that “developers must give the FAA the opportunity to evaluate proposed structures near airports to determine whether they could pose a hazard to aircraft or interfere with navigation aids. Each determination is unique. Our determinations identify hazards to air navigation.”
