A nonprofit group’s pursuit of public money for a sports arena is stirring a legal battle as heated as a playoff game.
Las Vegas Arena Foundation began a petition drive this month for a sales tax increase aimed at tourists. It would impose a nine-tenths-of-a-cent sales tax on the resort corridor, including the Strip.
The revenue would help fund a $500 million arena that would be built on 10 acres that Harrah’s Entertainment owns behind Imperial Palace. Boosters say it would house top-tier pro basketball, hockey and other events.
The group must gather at least 97,000 signatures by Nov. 9 to take the proposed sales tax increase to the Legislature, and, if that fails, to voters.
But MGM Resorts International and several other casino operators have challenged the petition on several legal points. They contend the petition omits important details, such as the arena possibly not getting built even if the tax is passed. A District Court judge will hear the case in Carson City on Tuesday.
Ex-county Commissioner Bruce Woodbury, who heads the arena foundation, said the legal fight was no surprise, given MGM’s staunch opposition to a publicly financed arena. He said his group is committed to building a 20,000-seat arena that would jump-start the economy.
"I think it would be an important step forward for our community," Woodbury said. "We think it would benefit all the (Strip) properties."
Boyd Gaming, the Tropicana and South Point joined MGM in the legal action.
MGM officials wouldn’t return phone calls seeking comment. They have said any arena receiving public funding would create unfair, subsidized competition to MGM’s private arenas. They especially are opposed to an arena built on land owned by Harrah’s, a competitor.
Harrah’s spokeswoman Marybel Batjer said MGM was being "shortsighted and selfish." Las Vegas will lose big events, and its reputation as an entertainment hub will suffer if it doesn’t build a new, full-scale arena, she said.
"It’s very disheartening that the gaming leadership can’t come together," Batjer said.
MGM opposition to publicly funded arenas is hypocritical, she said, because it received about $400 million in tax breaks for CityCenter.
Woodbury’s group decided to pursue other avenues for developing an arena after commissioners in June rebuffed all proposed arenas requiring public money. If the group gathers the required signatures by the deadline, it will introduce a bill in next year’s legislative session requesting the sales tax. If lawmakers don’t act on the bill in 40 days, the proposed tax would go to Clark County voters in 2012.
Although 97,000 signatures are needed, the goal is to get 130,000 to offset the thousands of invalid signatures that end up on petitions — for instance, from people not registered to vote, Batjer said.
She said she was confident her side would win in court.
"After the judge’s ruling, we’ll be back out gathering signatures," Batjer said.
Contact reporter Scott Wyland at swyland@review journal.com or 702-455-4519.Arena building financial impact