Las Vegas Stadium Alternative Funding Concept State of Nevada - - PowerPoint PPT Presentation

▶
las vegas stadium alternative funding concept
SMART_READER_LITE
LIVE PREVIEW

Las Vegas Stadium Alternative Funding Concept State of Nevada - - PowerPoint PPT Presentation

Oct 01, 2022 372 likes •865 views

DRAFT | For Discussion Purposes Las Vegas Stadium Alternative Funding Concept State of Nevada Creates Stadium Authority via State Legislation Proposed $750M $750M Clark County Las Vegas Construction Fund (TBD) Stadium Authority 1 Loan

slide-1
SLIDE 1

Las Vegas Stadium Alternative Funding Concept

DRAFT | For Discussion Purposes

slide-2
SLIDE 2

Proposed Stadium Corporate Structure

2

Source: LVS-Majestic Model, May 2016.

1 Assumed to be a newly created entity that is separate and distinct from the Las Vegas Convention and Visitors Authority 2 $200M face value of PSLs sold resulting in after-tax proceeds of $110M plus $200M of G-4 Loan and $100M Contribution from Raiders

$750M $750M State of Nevada Las Vegas Stadium Authority1 Sands / Majestic Las Vegas Events Center

(“EventsCo”)

Raiders Stadium Company

(“Raiders StadCo”)

Construction Fund Clark County (TBD) Creates Stadium Authority via State Legislation

Loan Agreement Where Stadium Authority Sends Tax Revenue to Clark County

Non-Relocation Agreement Stadium Sub-Lease Stadium Lease $410M (NFL G-4, Net PSL Proceeds, and Other Sources2) Ground Lease $650M

slide-3
SLIDE 3

3

Comparison of Alternatives

slide-4
SLIDE 4

4

Sands-Majestic Proposal Potential Alternative Total Cost $1.4 billion Stadium $1.3 billion Practice Facility $100 million Land N/A

Stadium Funding Models Comparison

slide-5
SLIDE 5

5

Sands-Majestic Proposal Potential Alternative Total Cost $1.4 billion $1.45 billion Stadium $1.3 billion $1.3 billion Practice Facility $100 million $100 million Land N/A $50 million

Stadium Funding Models Comparison

slide-6
SLIDE 6

6

Sands-Majestic Proposal Potential Alternative Total Cost $1.4 billion $1.45 billion Stadium $1.3 billion $1.3 billion Practice Facility $100 million $100 million Land N/A $50 million Public Funding $750 million Total Debt $572 million Pay-Go $95 million Coverage 1.55x

Stadium Funding Models Comparison

slide-7
SLIDE 7

7

Sands-Majestic Proposal Potential Alternative Total Cost $1.4 billion $1.45 billion Stadium $1.3 billion $1.3 billion Practice Facility $100 million $100 million Land N/A $50 million Public Funding $750 million $550 million Total Debt $572 million $421 million Pay-Go $95 million $67 million Coverage 1.55x 1.51x

Stadium Funding Models Comparison

slide-8
SLIDE 8

8

Sands-Majestic Proposal Potential Alternative Total Cost $1.4 billion $1.45 billion Stadium $1.3 billion $1.3 billion Practice Facility $100 million $100 million Land N/A $50 million Public Funding $750 million $550 million Total Debt $572 million $421 million Pay-Go $95 million $67 million Coverage 1.55x 1.51x Private Funding $650 million Sands-Majestic $240 million Raiders $410 million

Stadium Funding Models Comparison

slide-9
SLIDE 9

9

Sands-Majestic Proposal Potential Alternative Total Cost $1.4 billion $1.45 billion Stadium $1.3 billion $1.3 billion Practice Facility $100 million $100 million Land N/A $50 million Public Funding $750 million $550 million Total Debt $572 million $421 million Pay-Go $95 million $67 million Coverage 1.55x 1.51x Private Funding $650 million $900 million Sands-Majestic $240 million $400 million Raiders $410 million $500 million

Stadium Funding Models Comparison

slide-10
SLIDE 10

10

Sands-Majestic Proposal Potential Alternative Total Cost $1.4 billion $1.45 billion Stadium $1.3 billion $1.3 billion Practice Facility $100 million $100 million Land N/A $50 million Public Funding $750 million $550 million Total Debt $572 million $421 million Pay-Go $95 million $67 million Coverage 1.55x 1.51x Private Funding $650 million $900 million Sands-Majestic $240 million $400 million Raiders $410 million $500 million Preferred Investment Return Uncertain Residual Revenue (Private/Public) 100% / 0%

Stadium Funding Models Comparison

slide-11
SLIDE 11

11

Sands-Majestic Proposal Potential Alternative Total Cost $1.4 billion $1.45 billion Stadium $1.3 billion $1.3 billion Practice Facility $100 million $100 million Land N/A $50 million Public Funding $750 million $550 million Total Debt $572 million $421 million Pay-Go $95 million $67 million Coverage 1.55x 1.51x Private Funding $650 million $900 million Sands-Majestic $240 million $400 million Raiders $410 million $500 million Preferred Investment Return Uncertain 9.0% Residual Revenue (Private/Public) 100% / 0% 50% / 50%

Stadium Funding Models Comparison

slide-12
SLIDE 12

12

Sands-Majestic Proposal Potential Alternative Room Tax Resort Corridor 1.0% Outside Resort Corridor 1.0% Outlying Areas (25 mi) 1.0%

Stadium Funding Models Comparison

slide-13
SLIDE 13

13

Sands-Majestic Proposal Potential Alternative Room Tax Resort Corridor 1.0% 0.7% Outside Resort Corridor 1.0% 0.5% Outlying Areas (25 mi) 1.0% 0.0%

Stadium Funding Models Comparison

slide-14
SLIDE 14

14

Sands-Majestic Proposal Potential Alternative Room Tax Resort Corridor 1.0% 0.7% Outside Resort Corridor 1.0% 0.5% Outlying Areas (25 mi) 1.0% 0.0% Tax Increment Area Sales Tax Yes Live Entertainment Tax Yes Modified Business Tax Yes

Stadium Funding Models Comparison

slide-15
SLIDE 15

15

Sands-Majestic Proposal Potential Alternative Room Tax Resort Corridor 1.0% 0.7% Outside Resort Corridor 1.0% 0.5% Outlying Areas (25 mi) 1.0% 0.0% Tax Increment Area Sales Tax Yes Yes Live Entertainment Tax Yes Yes Modified Business Tax Yes Yes

Stadium Funding Models Comparison

slide-16
SLIDE 16

16

Sands-Majestic Proposal Potential Alternative Room Tax Resort Corridor 1.0% 0.7% Outside Resort Corridor 1.0% 0.5% Outlying Areas (25 mi) 1.0% 0.0% Tax Increment Area Sales Tax Yes Yes Live Entertainment Tax Yes Yes Modified Business Tax Yes Yes Tax Increment Distribution Stadium Authority 100% EventsCo 0%

Stadium Funding Models Comparison

slide-17
SLIDE 17

17

Sands-Majestic Proposal Potential Alternative Room Tax Resort Corridor 1.0% 0.7% Outside Resort Corridor 1.0% 0.5% Outlying Areas (25 mi) 1.0% 0.0% Tax Increment Area Sales Tax Yes Yes Live Entertainment Tax Yes Yes Modified Business Tax Yes Yes Tax Increment Distribution Stadium Authority 100% 0% EventsCo 0% 100%

Stadium Funding Models Comparison

slide-18
SLIDE 18

18

Stadium Funding Models Comparison

Sands-Majestic Proposal Potential Alternative Stadium Authority Board Allocations Tier 1: Debt Repayment $34.9 million $27.5 million

slide-19
SLIDE 19

19

Stadium Funding Models Comparison

Sands-Majestic Proposal Potential Alternative Stadium Authority Board Allocations Tier 1: Debt Repayment $34.9 million $27.5 million Tier 2: Stadium Authority Ops $0 $2.0 million

slide-20
SLIDE 20

20

Stadium Funding Models Comparison

Sands-Majestic Proposal Potential Alternative Stadium Authority Board Allocations Tier 1: Debt Repayment $34.9 million $27.5 million Tier 2: Stadium Authority Ops $0 $2.0 million Tier 3: Capital Improvement Fund Stadium Authority $2.5 million $5.0 million EventsCo $2.5 million $0

slide-21
SLIDE 21

21

Stadium Funding Models Comparison

Sands-Majestic Proposal Potential Alternative Stadium Authority Board Allocations Tier 1: Debt Repayment $34.9 million $27.5 million Tier 2: Stadium Authority Ops $0 $2.0 million Tier 3: Capital Improvement Fund Stadium Authority $2.5 million $5.0 million EventsCo $2.5 million $0 Tier 4: UNLV Payment $3.5 million $3.5 million

slide-22
SLIDE 22

22

Stadium Funding Models Comparison

Sands-Majestic Proposal Potential Alternative Stadium Authority Board Allocations Tier 1: Debt Repayment $34.9 million $27.5 million Tier 2: Stadium Authority Ops $0 $2.0 million Tier 3: Capital Improvement Fund Stadium Authority $2.5 million $5.0 million EventsCo $2.5 million $0 Tier 4: UNLV Payment $3.5 million $3.5 million Tier 5: Metro Police Funding $0 $4.0 million

slide-23
SLIDE 23

23

Stadium Funding Models Comparison

Sands-Majestic Proposal Potential Alternative Stadium Authority Board Allocations Tier 1: Debt Repayment $34.9 million $27.5 million Tier 2: Stadium Authority Ops $0 $2.0 million Tier 3: Capital Improvement Fund Stadium Authority $2.5 million $5.0 million EventsCo $2.5 million $0 Tier 4: UNLV Payment $3.5 million $3.5 million Tier 5: Metro Police Funding $0 $4.0 million Tier 6: Clark County Event Fund $0 Residual

slide-24
SLIDE 24

24

Proposed Funding Structure

slide-25
SLIDE 25

25

Stadium Authority Board

  • Clark County will issue bonds on behalf of Stadium

Authority Board in the amount supported by available room tax revenue and a coverage ratio of 1.5x

  • Maximum public funding: $550 million

Stadium Authority Board $550M Raiders $500M Developer $400M

NFL Stadium Proposed Funding Structure

slide-26
SLIDE 26

26

Stadium Authority Board

  • Clark County will issue bonds on behalf of Stadium

Authority Board in the amount supported by available room tax revenue and a coverage ratio of 1.5x

  • Maximum public funding: $550 million

Raiders

  • Contribution: $500 million

Stadium Authority Board $550M Raiders $500M Developer $400M

NFL Stadium Proposed Funding Structure

slide-27
SLIDE 27

27

Stadium Authority Board

  • Clark County will issue bonds on behalf of Stadium

Authority Board in the amount supported by available room tax revenue and a coverage ratio of 1.5x

  • Maximum public funding: $550 million

Raiders

  • Contribution: $500 million

Developer

  • Responsible for all remaining stadium development

costs, including land and required standard infrastructure

Stadium Authority Board $550M Raiders $500M Developer $400M

Total Cost $1.45 Billion

NFL Stadium Proposed Funding Structure

slide-28
SLIDE 28

28

Stadium Authority Board Formation, Powers & Authorities

slide-29
SLIDE 29

29

Seven Board Members Appointed By

Nevada Governor Clark County Commission Project Developer

Stadium Authority Board Formation

slide-30
SLIDE 30

Stadium Authority Board Powers & Authorities

30

  • Created as a unit of government with appropriate powers,

duties and authorities

  • Authorized to receive any private and public resources

necessary to fund, finance and develop the project

  • Authority to bond against the public revenues
  • Solicit and receive bids, enter into contracts, hire necessary

personnel and other duties necessary to discharge its responsibilities

  • Serve as the governing body for a tax increment area
  • Approve the stadium site
slide-31
SLIDE 31

31

  • Approve the overall scope of the stadium project
  • Approve the overall design and specifications of the stadium

project

  • Enter into a development agreement with the developers
  • Own the stadium
  • Receive audits and other project and performance

measurement-related reports to ensure stadium operations are consistent with the intent of the Nevada State Legislature

  • Authority to contract with a third party to operate the stadium
  • Ability to approve any development within the tax increment area

Stadium Authority Board Powers & Authorities

(continued)

slide-32
SLIDE 32

32

Stadium Authority Board Sources & Uses

slide-33
SLIDE 33

Sources Increase in the Hotel Room Tax

33

  • State of Nevada to increase room tax rates based on

geographic location

  • Stadium Authority Board receives incremental revenue
  • All taxes identified or relied upon for stadium construction

shall sunset when all public debt has been fully retired

Incremental Room Tax Increases NFL Stadium Area Amount

Resort Corridor 0.7% Outside Resort Corridor 0.5% Outlying Areas (25 mi) 0.0%

slide-34
SLIDE 34

34

Tier 1: Debt Repayment

  • 1.5x coverage

Tier 2: Stadium Authority Operations

  • $2.0 million per year, increasing 3% annually

Tier 3: Capital Improvement Fund

  • $5.0 million per year, increasing 3% annually

Tier 4: UNLV Payment for Lost Sam Boyd Stadium Events

  • $3.5 million per year, increasing 3% annually

Tier 5: Metro Police Resort Corridor Funding

  • $4.0 million per year, increasing 3% annually

Tier 6: Clark County Event Fund

  • Any remaining funds

Uses Allocation of Incremental Room Tax Revenue

slide-35
SLIDE 35

Event Fund Governance

35

  • To Be Determined
slide-36
SLIDE 36

36

Creation of a Stadium Tax Increment Area

slide-37
SLIDE 37

Stadium Tax Increment Area

37

  • State of Nevada to allow creation of a Tax Increment Area
  • Clark County will create Tax Increment Area unless state grants

necessary powers to Stadium Authority Board to do so

  • Tax Increment Area to include footprint of stadium and related

practice facilities

  • EventsCo receives all revenue generated from Tax Increment

Area, offsets additional capital contribution

  • Tax Increment Area capture rates:
  • Sales Tax – 100% of collections
  • Live Entertainment Tax – 100% of collections
  • Modified Business Tax – 100% of collections
slide-38
SLIDE 38

38

NFL Team Terms & Conditions

slide-39
SLIDE 39

NFL Team Terms & Conditions

39

  • Lease agreement of 30 years with two, five-year extensions at

team option

  • Minimum annual team rent payment of $2.5 million
  • Team guarantee for rent payments for full term of lease
  • All domestic home games must be played in stadium
  • Team provides an agreed upon number of affordable tickets and a

method for distributing those tickets

  • A best-practices public safety plan
slide-40
SLIDE 40

40

Stadium Developer Terms & Conditions

slide-41
SLIDE 41

Stadium Developer Terms & Conditions

41

  • Developer assumes all development and operating risk
  • Developer will operate the stadium and be responsible for all

costs associated with operation

  • Developer will provide an annual audit of stadium operations for

the prior fiscal year to the Stadium Authority Board no later than August 31st of each year

  • Developer will be allocated first 9.0% of free cash flow as a

preferred return on investment

  • Stadium net revenue in excess of 9.0% return on developer

investment will be shared on a 50/50 basis between developer and Stadium Authority Board

slide-42
SLIDE 42

42

  • Developers and the Raiders agree that they will make their best

efforts to acquire the NFL’s assent to relocate the Raiders to Las Vegas

  • Project funding
  • Stadium Authority Board bond funds will not be released

until $350 million of project expenditures have been incurred by the developers (modeled at January 1, 2019)

  • Thereafter, the remaining $1.1 billion will be funded equally

by the developers and the Stadium Authority Board

Stadium Developer Terms & Conditions

(continued)

slide-43
SLIDE 43

43

Stadium Timeline (Window of Opportunity)

slide-44
SLIDE 44

NFL Stadium Timeline

44

  • Developer must secure approval from NFL and contract with

Raiders to relocate team to Las Vegas within 12 months of implementation of room tax increment

  • A one-time six-month extension may be approved by Stadium

Authority Board

Potential Raiders Relocation Timeline

Initial 12-month NFL approval period 6-month extension

Start Date Room Tax Increment Takes Effect 12 Months from Start Date 18 Months from Start Date If No Relocation Deal, Room Tax Revenues Redirect to UNLV Stadium

slide-45
SLIDE 45

45

  • If NFL stadium proposal does not meet required contingencies,

room tax funds will be dedicated to build a collegiate-style stadium for UNLV football and events

  • Room tax increment funding is contingent upon UNLV raising

$200 million in private funds within 24 months and approval of development plan by Stadium Authority Board

  • If contingencies are met, the State of Nevada will issue bonds in

the amount supported by available room tax revenue and a coverage ratio of 1.50x

UNLV Stadium Alternative

slide-46
SLIDE 46

46

  • Under UNLV stadium alternative, incremental room tax

rates will be reduced Incremental Room Tax Increases UNLV Stadium Area Amount

Resort Corridor 0.375% Outside Resort Corridor 0.250% Outlying Areas (25 mi) 0.000%

UNLV Stadium Alternative

(continued)

slide-47
SLIDE 47

No Stadium Alternative

47

  • If UNLV does not raise the necessary private funds within the 24-

month timeframe, all collected incremental room tax revenue will be made available to repay bonds issued for the Las Vegas Convention Center expansion and renovation project

slide-48
SLIDE 48

Las Vegas Stadium Alternative Funding Concept

DRAFT | For Discussion Purposes