The city of Las Vegas would be responsible for more than $150 million — or more than 75 percent — toward the cost of a $200 million, 24,000-seat soccer stadium in Symphony Park that would be built for a possible Major League Soccer team, according to a term sheet obtained Tuesday by the Las Vegas Review-Journal.
The term sheet contradicts a press release distributed Tuesday by the city and its two private soccer stadium partners, which stated, “59 percent of these (stadium) costs would be privately financed.”
The city — along with the private partnership of The Cordish Co. and Findlay Sports &Entertainment — said the soccer stadium and team term sheet will be discussed at a City Council meeting on Sept. 3.
The public-private term sheet outlines a $302 million project budget:
■ $102 million for team equity.
■ $44.25 million for developer contribution for the soccer stadium.
■ $155.75 million from the public, including $114.75 for bonds, for the stadium.
Councilman Bob Beers said that if the private Cordish-Findlay duo is putting up $44.25 million, the “(22) percent is probably not a good deal for taxpayers.”
The Review-Journal asked Mayor Carolyn Goodman about the public’s contribution toward the $200 million soccer stadium. She referred questions to Justin Findlay, managing partner of Findlay Sports &Entertainment. He could not be reached for comment. The Findlay family owns car dealerships in Nevada and other Western U.S. states.
City spokesman David Riggleman explained that the public, in the end, will contribute only 41 percent toward the soccer stadium because the Cordish-Findlay partnership will help the city pay off the project’s debt service.
The term sheet said the bonds issued by the city will be repaid from three sources — the private partners paying $3.5 million annually in team rent; the partners contributing annual non-soccer revenue of $500,000 in year one through year 10, and then $1.5 million annually in years 11-30; and the city contributing $3 million a year in room tax revenue distributed to the city from the Las Vegas Convention and Visitors Authority.
The project description is highly unusual for a public-private partnership in one way — the total project cost includes $102 million for the cost of recruiting and acquiring an expansion team from Major League Soccer. MLS wants to expand to 24 teams, but there is only one slot left, and Las Vegas is competing against at least five other cities for the last franchise.
Paying more than $100 million for a team as part of a public-private project deal led Beers to say, “I was shocked that the cost of acquiring the franchise was part of the term sheet given that teams are portable.”
The joint announcement also failed to address several major issues, namely: What are the proposed stadium’s projected revenues from items such as naming rights, suite sales, parking charges, and concessions, and who receives those revenues?
Spokesman Riggleman said Cordish has conducted stadium revenue studies, but the Baltimore-based development company was unavailable Tuesday.
While the proposed deal does not rely on new tax revenues from local residents or businesses, the new stadium project will not move forward unless the Findlay-Cordish partnership lands an MLS team, and Findlay-Cordish would be responsible for cost overruns associated with the stadium’s design and construction, the release said.
The release also noted that the total project cost for the team and stadium, including interest on bonds over the 30 years, would be $410 million. The city would also own the stadium, but it’s unclear who would manage day-to-day operations.
According to the term sheet, the private partners “will contribute the Planning Fund balance for necessary soft costs required prior to issuance of any debt.” But the city will fund up to $2 million in additional soft costs, which are typically design and architectural service expenses.
The City Council is scheduled to vote on the nonbinding term sheet at its Sept. 3 meeting.
The nonbinding term sheet would outline the stadium’s proposed scope and financing.
If the nonbinding term sheet is approved Sept. 3, the city and the Findlay-Cordish partnership would present a binding document to the City Council in December.
If the council approves the nonbinding deal on Sept. 3, the city will hold public meetings about the stadium finance plan.
Contact reporter Alan Snel at firstname.lastname@example.org or 702-387-5273. Follow @BicycleManSnel on Twitter.