November 21, 2017 - 7:25 pm
Updated November 21, 2017 - 8:14 pm
The Las Vegas Monorail Co. received permission Tuesday from Clark County to expand its route from the MGM Grand to Mandalay Bay.
Before construction can begin, however, the monorail company needs to finalize the expansion’s design, conclude discussions with the county’s Department of Aviation and obtain financing for the project, President and CEO Curtis Myles said.
The 1-mile extension could take two years to construct and test.
County commissioners voted to approve a list of items that will help make the extension possible, including land-use permits and permission for the monorail company to continue drawing from a long-standing escrow account to pay for design and engineering costs.
But a resolution between the company and county, one that tipped heavily in the government’s favor, caused the most discussion.
The approved resolution will allow the monorail company to ask the county for up to $4.5 million a year in excess resort corridor room tax revenues. The money would be used to pay for track maintenance if no other money is available.
County Chief Financial Officer Jessica Colvin said the county is under no obligation to give the monorail company the money. Both parties agreed the county can rescind the resolution anytime.
Regardless, Myles said the resolution is of critical importance because it will allow the monorail company to sell rated bonds for its expansion project.
“This isn’t going to get us a AA rating, this is going to get us investment-grade rating,” Myles told commissioners.
Getting an investment-grade rating is expected to shave at least 1.5 percent off the bonds’ interest rate, a financial adviser for the project told commissioners. Previous estimates have put the project’s minimum cost at $100 million.
Commissioner Larry Brown called the resolution a “no-brainer” and moved for approval.
“I think we’re absolutely protected, but I’m hearing this resolution allows the monorail to have more strength in the financial market,” he said. “The monorail, whether you like it or not, is here, and this expansion could take us to the next level.”