On November 13, Las Vegas is set to begin building the $1.9 billion, state-of-the-art Raiders football stadium. Yet, in the new Republican tax bill, there contains a provision that could derail the financing of the stadium. What do we know now?
On Friday, the Las Vegas Review-Journal reported that the financing for the new 65,000-seat Raiders stadium project could be in jeopardy because the plan ends the tax-exempt status on bonds used to pay for professional sports stadiums, such as this venue.
The paper reports that the stadium, which will be located at Interstate 15 and Russell Road, falls “within the definitions and effective dates of circumstances.” Part of the funding for the stadium includes $750 million tax-exempt bonds.
The paper further explained that these tax-exempt bonds made the stadium “more affordable” and an “economic development driver,” according to the Las Vegas Stadium Authority and the Southern Nevada Infrastructure Committee.
As of now, the stadium authority board members are concerned about this new development. Jeremy Aguero speaking on behalf of the stadium authority, admits this could affect the original budget for the stadium. The $750 million set aside for tax-exempt bonds is a good chunk of the entire $1.9 billion dollar price tag.
“The stadium, as designed, appears to meet the definition of a project that could not use tax-exempt bonds. That could potentially affect the financial models we have been using in estimating the potential cost of the project. The extent to which that is is unknown.”
Las Vegas attorney and UNLV instructor, Richard Jost, explained that this sort of provision was a total “surprise” to those in the inner White House circles. They never expected anything like this in the 429-page bill.
“It was somewhat of a shock to everybody that not only was it in the bill that effective yesterday, the day the bill dropped, you can’t issue so-called governmental bonds for sports stadiums and effective on the last day of this calendar year, bonds issued by state and local governments on or after Jan. 1, 2018, can be issued, but if they’re issued for so-called private activity uses, the interest on them is not tax-exempt.”
An attorney said it was unclear exactly how the legislation would affect stadium effortshttps://t.co/Sxzj4v6vys— Las Vegas RJ (@reviewjournal) November 4, 2017
Jost also pointed out that it is hard to determine the financial implications if the bill as it is written passes. As of now, there are too many uncertainties, including “grandfathering out of legislative proposals.”
Although Jost and those involved in the new Raiders stadium are in shock, some could possible ask if it is too much of a coincidence that when the president planned to unveil his new tax plan, he was at war with the NFL on Twitter?
On October 10, Donald Trump tweeted his displeasure with the NFL and what he considered lax tax laws that he believes benefits the NFL owners. He advised that these laws must “change.”
Why is the NFL getting massive tax breaks while at the same time disrespecting our Anthem, Flag and Country? Change tax law!— Donald J. Trump (@realDonaldTrump) October 10, 2017
Do you agree that the tax-exempt bonds that fund such buildings as football stadiums should no longer be valid in the new Trump tax plan? Do you think that the new Raiders stadium should be grandfathered out of this provision?
[Featured Image by Chris Graythen/Getty Images]