June 1, 2014 - 7:18 am
Ridership is up, the economy is improving, new attractions are opening, so let’s just cut to the chase about the Las Vegas Monorail: When will Las Vegas see a line extension to McCarran International Airport?
Curtis Myles chuckles at the question.
“I hear that every day,” the CEO of the Las Vegas Monorail Co. said. “And when I see my dad every Sunday, he asks me the same question.”
It seems to be a reasonable inquiry. Monorail proponents have assumed since the 3.9-mile elevated transit system opened in 2004 that it would become successful only if and when it linked the airport with the resort corridor, a common strategy for rail systems in cities worldwide.
The simple answer from Myles now is that it’s still too early to tell if the extension, which would cost between $400 million and $500 million, is worth pursuing. A spokeswoman for the monorail said the company could raise money through investors or by taking on debt through bonds, but “it’s too soon to discuss funding of any project and it would be part of the conversation involving the Regional Transportation Commission’s transportation plan.”
A committee of transportation and tourism leaders has met regularly since last summer to build the outline of what’s being called a transportation investment business plan that incorporates the development of a multimodal transportation center at the Las Vegas Convention Center.
Michael Gallis, a Charlotte, N.C.-based consultant, is in the research phase of the Regional Transportation Commission plan that isn’t expected to be delivered until next year.
In the meantime, Myles is content to wait for the study’s results and watch the monorail’s financial picture brighten in the months ahead.
In April, the company reported its third straight quarter of passenger increases with 1.1 million riders and farebox revenue of $5.1 million over the first quarter of 2013. That’s a 14 percent increase in passengers and an 11.5 percent increase in revenue from the same period a year ago.
Company officials attributed the bump partly to the opening of the highly visible High Roller observation wheel. Monorails cruise below the Caesars Entertainment attraction about every five minutes.
In March, Las Vegas also hosted the ConExpo-Con/Agg construction show, an event that occurs just once every three years.
Thousands of the nearly 130,000 show delegates used the monorail on show days.
Myles believes the double-digit percentage increases will continue through the rest of this year, especially with the SLS Las Vegas opening on Labor Day weekend.
The monorail company first met with SLS executives when the company broke ground on the property at the site of the old Sahara to discuss marketing and partnership strategies.
“There’s a tendency to believe that SLS, as a popular Southern California brand, would produce some great numbers for us, but we’re going to look at it conservatively,” Myles said. “We’re looking at it producing the same numbers as when the Sahara was open.”
And that would mean an increase of 8 percent to 11 percent.
AT THE TABLE
The transportation committee, formed by Las Vegas Convention and Visitors Authority President and CEO Rossi Ralenkotter, has all the key players in transportation and tourism at its table. Among the stakeholders are representatives of the resort community, the convention industry, the Regional Transportation Commission, McCarran, the Metropolitan Police Department, the city’s bus and limousine companies, taxi company owners and Nevada Taxicab Authority regulators.
“We’re finally all at the table, and it’s really nice,” said Rosemary Vassiliadis, director of the Clark County Aviation Department. “I think that’s a first. We’re all talking about all modes of transportation and how they can work together.”
Vassiliadis said the group will get recommendations from the Gallis report and analyze what’s best for the community and visitors.
One of the options is developing a new light-rail system or a more versatile bus rapid transit line with dedicated lanes.
The committee has traveled to Phoenix and Salt Lake City to see how their light-rail transit systems serve the airport.
The Salt Lake City TRAX light-rail system has a station at Salt Lake City International Airport. In Phoenix, the Valley Metro Light Rail line is within a few blocks of Sky Harbor International Airport, so the airport runs a free shuttle bus from two terminals and a Sky Train rail line to it from another.
MONORAIL AT McCARRAN
Would the monorail work at McCarran?
Vassiliadis isn’t tipping her hand on what she thinks will happen, preferring instead to be ready for whatever unfolds.
Airport planners have sketched out where monorail stations would work at both Terminal 1 and Terminal 3. She said inquiries were made of the monorail company in the construction phase of Terminal 3 and when it became apparent there wasn’t anything on the immediate horizon, some options were blocked because construction could cause operational disruptions.
Vassiliadis’ predecessor, Randall Walker, wasn’t a big advocate for the monorail, saying he didn’t believe the system’s riders would be interested in walking with their suitcases to and from monorail stations when easier options would exist.
Myles disagrees. He said resort operators would find a way to accommodate monorail riders so that they wouldn’t have to walk as far once they arrive at their hotel station. Myles also said by the time the monorail tracks get to the airport, the company would be acquiring new trains that would include racks for bags and suitcases.
“My job is to get people to the hotel,” Myles said. “You’ve got CEOs that are billionaires that know how to manage their customers once they get there. And they’re pretty good at it. They’ve told me over and over that the real challenge is getting people here in the first place. We’re competing with China. We’re competing with Brazil. Soon, we’ll be competing with Japan, which is supposed to be the next big thing. So I’m not worried about where I drop them off once they get here. I worry about them getting here.”
Tina Quigley, the Regional Transportation Commission’s general manager, considers the monorail a community transportation asset.
“We’re working collectively,” Quigley said of the group. “Every alternative needs to be included in the discussion. And I think the key is we have to think in terms of growing as a destination, not just growing our own businesses.”
Quigley’s goal is to have “as many alternatives and modes as possible to get people from Point A to Point B.” She scoffed at the notion that the politically connected taxicab industry would block any effort to extend the monorail to the airport or that extending the monorail to the airport would kill the cab industry.
“There’s a certain demographic that is always going to want to use a taxi instead of mass transportation,” Quigley said. “There will be enough for everybody.”
Myles said since he’s been CEO of the monorail company he never has seen any political pressure from the cab industry.
“The cab industry isn’t doing anything today to prevent us from going to the airport,” Myles said. “I don’t know what they did in the beginning when I wasn’t here.
“I’ve had conversations with some of the cab company owners about us going to the airport. I don’t think the monorail going to the airport is going to do anything to the cab industry. That (suspicion) comes from a lack of understanding of who’s coming to town and why. There’s always going to be a huge demographic that is going to want to take a cab.”
Myles said it’s a perception “we’re going to have to deal with.”
Brent Bell, who heads Bell Transportation, which has taxi and limousine operations in Southern Nevada, said in a recent editorial board meeting of the Las Vegas Review-Journal that the only dustup the cab industry has had with the monorail company involved plans to build the monorail guideways from Paradise Road and Twain Avenue to the Las Vegas Convention Center.
The guideways on the southern end of that section straddle Paradise Road, but farther north, they’re supported by structures in the center of the street. The end result was that the monorail track placement resulted in the loss of a traffic lane where taxi drivers need it most — near the Convention Center.
Bell said the taxi industry has no organized effort to block the monorail to the airport.
So what’s next for the monorail?
Myles said until the Gallis plan is presented and vetted by the committee, he and the company are satisfied with continuing efforts to rebound from the Great Recession that resulted in the company filing for and successfully emerging from Chapter 11 bankruptcy protection.
For monorail investors and the insurance company that backed the bonds to build the system, the bankruptcy was a disaster.
The two-year trip through the U.S. Bankruptcy Court proceeding that ended in 2012 left the company with a 98 percent reduction of debt to $13 million and maintained its not-for-profit status.
Local governments didn’t lose any money, but the company lost its ability to advertise and market the system, one of the conditions set by the bankruptcy restructuring officer. The ad budget was slashed by 95 percent.
With finances reorganized and debt manageable, the company can get back to promoting the system and selling contracts to convention groups for big events and trade shows.
“We knew we had to get back into selling the system,” Myles said. “We basically went dark in terms of our marketing presence for four years, from June 2008 to June 2012.”
Myles knew that it normally takes at least six months for a renewed marketing effort to show results, and the company started seeing increases in April 2013.
Another piece of the marketing that went away in bankruptcy in 2008 was a customer-service presence in stations. That’s something that has returned postbankruptcy.
Now, Myles is confident that the system has the cash flow necessary to maintain its operation and set aside money for capital improvements.
There’s even a plan in place to replace trains and upgrade stations in coming years.
“Guideway improvements occur constantly, and they’re part of our operations and maintenance contract we have with (manufacturer) Bombardier,” Myles said.
The company expects to replace elevators and escalators in the system’s stations by 2021 and 2022.
The trains have a 30-year lifespan, and the first ones went into service in 2002 and 2003. When initially purchased, the trains cost around $9 million apiece. Since then, Bombardier has made improvements to the system to make manufacturing less expensive, but factoring in inflation, he expects new trains will run between $8 million and $10 million each.
Myles said the newer trains might also have new amenities, such as luggage racks, electrical outlets for passengers to charge their electronic devices when they get off their planes and onboard Wi-Fi.
If the monorail line is extended to the airport, it would require the company to purchase another seven trains at $8 million to $10 million each to maintain its current level of service.
An extension to the airport isn’t the only one under consideration. Ralenkotter and Myles have discussed the possibility of connecting the city’s three major convention centers, the Las Vegas Convention Center, the Sands Expo and Convention Center and the Mandalay Bay Convention Center.
“That,” said Myles, “would be an incredible competitive asset. We’d have 10 million square feet of exhibit space connected. There’s nothing like that anywhere in the world.”
Connecting the convention centers would require building a station near the Sands Expo and Convention Center — presumably over the intersection of Koval Lane and Twain Avenue — and an extension from the monorail’s southern terminus at the MGM Grand to Mandalay Bay. Myles noted that a station at Mandalay Bay could become the beginning point for a line on the west side of the Strip that eventually could connect even more rooms to the airport some day.
There also has been talk of extending the monorail north from the SLS station to downtown Las Vegas where more and more tech-savvy millennials who use mass transit are moving.
Any extension of the line would make the system more appealing to local residents, which now make up just 2 percent of the approximately half-million monthly riders. It’s not that the company hasn’t tried to get more locals to ride — Las Vegas residents can buy a one-way ticket for $1 at stations staffed with customer service representatives — the least expensive mass transit on the Strip.
So for now, Myles will continue to wait.
“Everybody (on the transportation committee) agreed to set their private interests aside, which is a hard thing to do,” he said.
“But if the community isn’t going to get behind it, it’s not going to happen. We have to be a part of a bigger solution. And it’ll happen when we collectively agree that it’s in the best interest of the community.”
Contact reporter Richard N. Velotta at firstname.lastname@example.org or 702-477-3893. Find him on Twitter: @RickVelotta.