It’s official. The Athletics, despite a valiant, last-ditch effort from the fans, will no longer be at home in Oakland. Instead, they will be adopted by Las Vegas, a city with money, new fans, and a state-of-the-art stadium that is not home to a press box possum.
This week, the Nevada Legislature passed a bill securing $380 million in public tax dollars to fund a new stadium. It is estimated that the move will generate over $440 million for the city over thirty years. But those standing in opposition argued that the bill gives tens of millions of dollars to a billionaire for little return.
The Senate’s swift action to pass this bill was met with both support and criticism. Lawmakers in support of the deal underscored the recent success of newly-minted Vegas sports teams - the WNBA championship Las Vegas Aces and Stanley Cup-wielding Golden Knights. Regardless of the debate, I’m here to break down the key financial components of Senate Bill 1.
A’s ownership will get $36 million per year from the county
The bill approves $36 million per year in public financing to build a new stadium. I, personally, cannot even comprehend that number over a lifetime let alone one year. Technically, the Legislature is not cutting a check for the total $380 million. Payments will consist of a combination of funding with $180 million in tax credits that can be sold to other businesses for cash, $120 million in county-issued bonds, and $25 million credit to address infrastructure needs for the stadium.
Proponents of the bill argued that this combination will create a “waterfall” effect where the tax revenues generated within the stadium would be used to pay back the public bonds through a priority account. Overflow funds would be put into a secondary account.
This revenues overflow, in turn, would be channeled into a county fund that supports community initiatives, like low-income housing. The exact amount is unclear and would be determined by how much actual revenue the stadium eventually generates.
The A's will be required to fund community outreach initiatives
The bill, almost idealistically, requires the organization to make an “adequate financial commitment to the community.” What exactly does this mean? The team must pay the greater of $2 million or 1% of team ticket revenues to the Las Vegas community. However, the large disparity between the money to build the stadium and the required output for the community was a point of contention for legislators.
A stadium community oversight committee will be charged with the implementation of initiatives. Committee members must have lived in the county for at least five years and “reflect the diversity of [the] State.”
What does this mean for the A’s?
The financial structuring is complicated. The uncertainty of revenue returns also raises concerns about the success of the initiatives. Primarily, will there be enough to fund community projects? For now, it’s unclear what this means for the A’s - and Las Vegas - beyond relocation and a new stadium.
That said, and after Thursday's news broke that Nevada Gov. Joe Lombardo has signed the bill for the construction of the new Las Vegas Strip stadium, you can be sure the Las Vegas A's will be the next team to play ball in the MLB.