Proposed arena tax to go before Legislature

Sports arena proponents won the latest round in their push to create a venue for top-tier professional basketball, hockey and other events near the Strip.

A proposed sales tax that would fund construction of a 20,000-seat arena on Caesars Entertainment land will go before the state Legislature in 2011.

The secretary of state's office confirmed Monday that enough signatures were gathered in Nevada's three congressional districts to petition the Legislature for a nine-tenths-of-a-cent sales tax. The tax would be limited to a three-mile area encompassing the Strip, with the intent of targeting mostly tourists.

In the next legislative session, which starts Feb. 7, lawmakers must act on the bill in 40 days. Otherwise, the proposed tax will go to voters in the 2012 general election.

A nonprofit group led by former Clark County Commissioner Bruce Woodbury is working with Caesars to develop the half-billion-dollar arena on 10 acres the casino giant owns near Imperial Palace.

"This is a good step forward in the process," Woodbury said. "I am cautiously optimistic that one way or the other this will get approved."

For the petition to advance, 10 percent of voters in each of the three congressional districts had to sign it, for a total of 97,000. The threshold was met in all three, totaling 157,000 signatures.

Two of the districts fall squarely in Clark County, and one covers part of Clark County and all of the other 16 counties in the state.

Caesars and Woodbury's group decided to petition for the sales tax after county commissioners in June rebuffed all proposed arenas requiring public money.

But a group of casinos led by MGM Resorts International opposes a publicly funded arena, arguing that it would pose unfair competition to private venues. Boyd Gaming, the Tropicana and South Point also oppose the proposal.

The group has seven business days, the middle of next week, to file a lawsuit challenging the petition.

Attorney Scott Scherer, who represents the companies, said a legal challenge was looking more likely. An investigation by the group is turning up enough questionable signatures and documentation to cast doubt on the petition results, he said.

"Based on the preliminary numbers, it seems likely to go that way," Scherer said, referring to the lawsuit. "We want to do our work to make sure our numbers are correct."

A lawsuit probably will not keep the proposed sales tax from being introduced to the Legislature unless the court orders an injunction, Scherer said.

Woodbury said he is not surprised that the MGM-led alliance is about to sue.

"That's been the pattern so far," Woodbury said. "I was hoping for a breakthrough. But it looks like it's going to be confrontational."

The same operators challenged the petition three months ago, alleging it contained misleading language and omitted important details. A District Court judge upheld the petition in September.

Caesars spokeswoman Marybel Batjer said that she found MGM's continued opposition to the sports arena "disheartening" when all the Strip casinos would benefit.

"This will create jobs, this will create future revenue," Batjer said.

But MGM spokesman Alan Feldman argued that tax dollars should not go to an arena when state and local governments are in a deepening budget crisis.

"If someone wants to build an arena, they should come in and do it" with private dollars, Feldman said.

Woodbury said he will try to change opponents' minds.

"We'll reach out to other players on the Strip and try to find some common ground for everybody," Woodbury said.

Contact reporter Scott Wyland at swyland@reviewjournal.com or 702-455-4519.