Well, after being blasted and made fun of on a consistent basis by some so-called Oakland Raiders fans, I have not one problem saying that I told you so. I said that Nevada Governor Brian Sandoval’s Southern Nevada Tourism and Infrastructure Committee (SNTIC) – the temporary group he formed to bring attention to pressing capacity problems with all types of infrastructure in that state – would wind up considering a proposal that would result in a lower public funding portion than the level that Oakland Raiders Owner Mark Davis said was something he had to have: $750 million.
I also said the SNTIC would not take action on the Oakland Raiders Las Vegas Stadium, and they did not – but what they did talk about doing in the stadium workshop session set the tone for what will be an amazing July 11th meeting: an alternative proposal of $550 million from hotel tax revenues over a 30 year period. And an amount not far off from where I said it would be.
As I have said before, that’s not at all surprising because there is not enough projected hotel tax revenue to do both LVCC Expansion and the Las Vegas Raiders Stadium and at the bond debt coverage ratios called for; what is surprising to me is that Oakland Raiders President Marc Badain would basically lose his temper over the matter. When faced with the news, Badain said for the public to hear that the news “Was terrible for the Raiders Organization” and that he was “disappointed by what we’ve seen today” and let it be known that the reduction of the public tax revenue share “would be viewed as a negative by the team.”
Marc should have just clipped himself. What he should have said is “We’ll take a look at this proposal and talk more about it after the meeting.” But the way he and his Majestic Realty and Las Vegas Sands colleagues handled the news was such that they showed right off the bat how collectively unfamiliar with high-stakes politics they are. Especially Badain, who has been the Raiders President for just over one year, and all of that was evident at the SNTIC meeting and just when the situation called for political savvy.
Instead, Badain reached for the old Al Davis playbook of domination that worked for the organization in the 20th Century, but only pisses people off and makes them find ways around the Silver and Black in the 21st Century. What Marc forgot, if he was ever trained to know it, is that in the field of high-stakes politics, one always prepares for the alternative, keeps his or her cool, and has a backup plan. Badain and his friends showed they were not ready for negotiating prime time with their reactions.
About now, you may be wondering why I read like I’m upset with Marc given that he’s all but doomed his Las Vegas project to failure. It’s because we in Oakland have had to deal with the same person and organization, that’s why. I am going to save the Oakland side of my blast of the Raiders management and negotiating style for another post, but I have to report I thought the organization’s lack of preparation was something evident only in Alameda County. Nope. Not at all. Mark Davis and Marc Badain have mishandled Carson and now Las Vegas – they’re better off staying in Oakland, where they have true friends among elected and appointed officials. The Las Vegas people are completely smooth cut throat experts apparently cut from the same cloth as the legendary Pete Rozelle, the NFL Commissioner – they nice you to death. Yours, not theirs.
In this case, Las Vegas Sands CEO Sheldon Adelson has thrown Davis and Badain to the wolves. Adelson knows full well there are powerful business interests that want the expansion of the Las Vegas Convention Center, and he’s using the Raiders to stop their efforts because he objects to the use of public money for convention centers. Oh, and let’s not forget his own hotels and casinos and convention centers in Las Vegas and Macao, China, either. Wants to make sure the business playing field is tilted in their direction.
It never occurred to Mark Davis or Marc Badain just how much these people who run the Las Vegas Convention Center and the Convention and Visitors Bureau really want him out of the way, but they will never at all say it. Sure. Of course they want the NFL, but not using a scenario that cuts into their seed corn: hotel tax revenue. So, they’re being real nice about it, and making it look like the Raiders are going to get what they want. But what’s happening is, little by little, the Raiders aren’t getting what they want at all.
And on Thursday, Steven Hill, the Chairman of the SNTIC, and the Director of Economic Development for Nevada, said the magic words that make this the very battle I did not see coming, but now it all makes sense: Hill said they were going to compare the economic benefits of both the LVCC Expansion and the Raiders Las Vegas Stadium, side-by-side.
Wow.
So on July 11th, the two projects that everyone said were both wanted are going to be compared. And on top of that, the Raiders Las Vegas project comes in with a huge number of unknowns: land cost, infrastructure costs, and stadium cost overruns are not known, and Hill admitted that the $50 million land cost figure was an estimate based on something which caused him to throw up his hands – basically, they guessed.
They guessed.
They guessed because they don’t have a site. They guessed because neither Las Vegas Sands nor Majestic, nor The Raiders bothered to come up with sound land costs for a series of possible sites. And they don’t have a clue as to the cost of infrastructure, which could zoom to $200 million depending on the site selected. They do not know anything expect having some basic idea of what a cookie-cutter stadium proposal should be.
So, the Raiders did what they do best: leave it to the government folks to figure out – only they’re dealing with a group that’s new to the matter of NFL stadium finance in the form of the SNTIC. And at that, a group under a massive time crunch of just about a month and a half of life left in a almost six month period of talks for something that takes one or two years to plan and then another two or three years to build.
Bad idea.
As I said before, the SNTIC will come up with an alternative, and even beyond what was proposed, but the Raiders won’t like that one either. LVCC expansion is looming. The future of the Clark County Hotel Tax Revenue and Las Vegas convention future is at stake. So, the SNTIC set up a battle between them, and I’m not betting on the Raiders to win it.
Logically, given the time crunch and all of the problems, what the SNTIC may do is recommend an NFL Stadium task force to finish the work of the SNTIC. Mark Davis will certainly not like that, but if the Raiders really knew what they were doing, they would not be in this situation to start with.
Stay in Oakland.