Potential deal for A’s relocation to Las Vegas could rely on $500 million in public financing
The Oakland A’s spent nearly two years identifying a location for a $1.5 billion stadium and entertainment complex in Las Vegas. But now the team and state lawmakers have a month and a half window before the legislative session ends to hammer out details of a $500 million public financing contribution toward a 35,000-seat retractable roof ballpark near Tropicana Avenue and Interstate 15.
Though there is a rough outline of a proposal for the potential relocation of the A’s to Las Vegas, no formal legislation has been introduced or requested, and state lawmakers have not received specifics or made any commitment to support the project. Without a deal approved by lawmakers, the A’s could withdraw from the agreement to purchase land for the stadium site and choose not to relocate to the Silver State.
If an incentive package is not agreed to by the end of the legislative session on June 5, state officials may be forced to call a special session to move forward with the relocation deal before Major League Baseball’s self-imposed deadline of Jan. 1, 2024, to sign off on the deal.
The A’s need to have a financing package in place before submitting its request to relocate the franchise from Oakland to Las Vegas.
The A’s are investing $1 billion into the project and are asking state lawmakers to create an “incentive program” in which tax dollars created by the stadium and its surrounding amenities are directed into a fund to pay off $500 million in public bonds that would be issued by Clark County.
Unlike the $750 million in public money used for Allegiant Stadium — which is being paid off through hotel room taxes in the Las Vegas Strip corridor — the A’s stadium public financing would come from sales taxes and other fees paid by consumers at the venue and the surrounding attractions within the 49-acre site, Jeremy Aguero, founder of Las Vegas advisory firm Applied Analysis that is consulting with the A’s, told The Nevada Independent.
“Obviously, there's been a lot of conversations but there are a lot of moving parts that have to be perfected in order to make that work,” Aguero said. “A ton of work has been done by the A's as well as folks at the state and local governments. The A's are willing to make that kind of investment here because they believe in that level of effort.”
In an interview with The Nevada Independent on Thursday, A’s President David Kaval said the actual nature of a public-private partnership between the team, the state and Clark County “is not fully established.”
He cited statistics from a feasibility report done for the team in which A’s games in Las Vegas would generate 400,000 annual incremental new tourists to Nevada.
“We’re having those dialogues in a really positive way, and we want to do it in a fiscally responsible way that works within the confines of the public policy parameters that have been established,” Kaval said.
Aguero said the Las Vegas Stadium Authority, which oversees Allegiant Stadium, would also oversee the A’s stadium and manage the bond financing.
Even though Clark County and the state wouldn’t see any tax dollars directly from the stadium for at least 30 years, Aguero said there are other ways the tax coffers could benefit from “incremental money” spent by visitors, such as room, sales and retail taxes at locations away from the stadium.
“All of those taxes would continue to the benefit of state and local governments [and] school districts,” he said. “While the patron is specifically in the sports and entertainment district, those taxes will be reinvested back into the sports entertainment district.”
Kaval said the next step in the process is understanding the nature of the “incentive program” that will allow the A’s to build the stadium.
“We're looking at things like tax increments, a sports entertainment district [and] things like transferable tax credits,” Kaval said. “But nothing is finalized. It's still at the point where we're trying to work and find ways to ensure it's done responsibly. That is a positive [return on investment] for Nevada.”
If lawmakers and the team cannot agree by the end of the legislative session June 5, there is precedent for such a deal to come together during a special session, such as when lawmakers met in October 2016 to agree to a public financing deal for Allegiant Stadium.
A’s find a stadium site
The A’s reached an agreement with Red Rock Resorts to acquire 49 acres of a nearly 100-acre site near the intersection of Tropicana Avenue and Interstate 15. A purchase price for the land has not been disclosed.
The portion of the site for the stadium is bordered to the east by Dean Martin Drive. It once housed the Wild Wild West Casino, which was closed and demolished in September. The A’s also have the option to acquire another 8 acres at the site from Red Rock Resorts at a later date.
CBRE Vice President Michael Parks, whose firm helped the A’s evaluate dozens of potential sites for a baseball stadium during the past two years, called the deal a normal real estate transaction “where [the team] has a due diligence period” to close on the sale.
“They have just executed the purchase contract. They have not closed on the acquisition,” Parks said.
If the tax package were to collapse in Carson City, could the A’s withdraw from the land purchase?
“That would be an accurate statement,” Parks said.
Both the A’s and their real estate partners said the stadium would be easily accessible to locals and tourists coming from the Strip. Kaval said the team is in discussions with Clark County and state officials about constructing a pedestrian walkway over I-15 that would connect the stadium with Park Avenue, where T-Mobile Arena and Park MGM Resort are located.
Kaval said the location will be more than just the stadium.
The location will include an entertainment district open year-round with restaurants, bars and other amenities surrounding the stadium. He likened the site to The Battery in Atlanta, the entertainment district that includes Truist Stadium, home of the Atlanta Braves.
“Three million people go to the stadium. But another 10 million people come to The Battery every year,” Kaval said.
Members of legislative leadership have been briefed on the proposal, but have not yet received concrete details nor committed to supporting such a proposal.
A spokesperson for Gov. Joe Lombardo said the proposals are preliminary and he is not going to make any additional statements about the project.
“There is no set timeline. The financial elements of the concept are still being discussed,” his spokesperson Elizabeth Ray said.
Where will the A’s play next?
Kaval said the A’s would like to break ground on the Las Vegas stadium next year and a three-year building process would have the new home of the team ready for the 2027 season.
Where the team plays in the interim is yet to be determined.
He said the A’s are under contract to play in Oakland in 2024 but Major League Baseball will make the determination of where the team will play.
Kaval didn’t rule out the team playing for several years at Las Vegas Ballpark in Summerlin until the new stadium is completed but couldn’t say if the A’s would share the 10,000-seat stadium with the Las Vegas Aviators, the team’s triple-A affiliate.
He did say that the Aviators would continue to play in Las Vegas as the A’s top farm team after the new stadium is complete.
“I think it's an incredible community asset for Summerlin and for that entire development,” Kaval said of the developer, Howard Hughes Corp., which owns the Aviators. “Having the triple-A in the same market is a huge benefit.”
Eyes on Vegas
Last year, Commissioner Rob Manfred said MLB would waive the relocation fee if the A’s moved to Las Vegas.
The A’s have been seeking a new home to replace their dilapidated 57-year-old Ring Coliseum in Oakland. The team has been hoping to reach a deal on a new waterfront ballpark in the city, but has also focused on Las Vegas in a parallel effort.
Public records indicate Lombardo met for an “Oakland A’s Policy Discussion” and with the Oakland A’s on two occasions in February. That same month, The Nevada Independent reported that the A’s had hired 18 lobbyists for the state’s 120-day legislative session. Kaval also registered as a lobbyist at that time.
“We just want to be very thoughtful and mindful of the best policy decisions that are in the court of the legislature and the county officials. We don't want to assume anything,” Kaval said of the team’s initial meetings with lawmakers. “We feel like we've had a good dialogue and we want to continue to have that dialogue.”