Sheldon Adelson Pulls $650 Million in Funding for the Las Vegas Stadium Project
Earlier this month, it was announced that Sheldon Adelson reneged on an agreement to pay $650 million into the proposed $1.9 billion domed stadium planned for Las Vegas. Subsequent reports suggest that Adelson’s decision is final. The loss of funding puts the Oakland Raiders’ move to Las Vegas in jeopardy.
With roughly 33% of the funding no longer existent, the Raiders ownership is going to have a hard time justifying a move to Las Vegas with the NFL ownership. The NFL owners planned a March meeting to vote on the Oakland Raiders’ planned move.
Disagreements between Adelson and the Oakland Raiders
According to the Adelson-owned Las Vegas Review-Journal, Sheldon Adelson’s pullout was due to disagreements between Mark Davis, owner of the Oakland Raiders, and the Adelson family.
A spokesman for the Las Vegas Sands told the Review-Journal that the proposed lease agreement document “did not reflect the commitments that the Adelson family made to the Raiders and that the Raiders had made to the Adelson family.”
Sheldon Adelson Warned of Funding Pullout
Back in late-2016, Sheldon Adelson had warned he might withdraw his support for the NFL-ready domed stadium if the Raiders were not more reasonable. In announcing Adelson’s withdrawal of support, the LVS spokesman accused the Raiders of “picking (Adelson’s) pocket“.
Las Vegas Sands Corp said in its statement that the Oakland Raiders were being selfish in their vision for the stadium. LVS accused the NFL franchise wanted a one-sided lease that did not take into account other uses of the stadium, which presumably would be UNLV Football and major concerts.
“Making It All about the Raiders”
With its charges of selfishness and “making it all about the Raiders“, the Las Vegas Review-Journal news report sounds as if a clash of egos was at the heart of the dispute.
The LVS statement said, “If they think that they’re going to go forward making it all about the Raiders and not about all the other things that drive visitation, I think they should be prepared for some long stadium authority meetings.”
The news comes at an inauspicious time for the Oakland Raiders, but also for the city of Las Vegas. Political and business leaders in the Las Vegas community long have sought a major pro sports franchise. Last year, Las Vegas was able to lure an NHL franchsie, but an NFL franchise is the white whale of sports business.
Lost Chance to Attract a Major US Sport
If the NFL relocated a franchise to Las Vegas, then the city could lure a franchise from any major American sport. For that reason, Nevada politicians and Las Vegas businessmen were willing to pay nearly $2 billion to see a major modern domed stadium built near the Las Vegas Strip. The idea was the newly-built stadium would transform Las Vegas’s image from a relatively small American city and a major casino destination into something different — a major American city with full legitimacy in the sports culture.
Another major consideration in the luring of major US sports franchises is the softening of attitudes towards sports betting. The NFL, NBA, and Major League Baseball led the lobbying effort to pass the Professional and Amateur Sports Protection ACT (PASPA) of 1992. The PASPA was an attempt to ban sports betting in all 50 states at the federal level.
Eventually, Nevada and three other states lobbied to protect their sports betting industries. Those four states had their sports gambling grandfathered into PASPA, while the other 46 states were given one year to pass their own sports betting laws. (None did.)
Despite legal sports betting in Las Vegas, the sports leagues have continued to oppose sports betting in most forms. When New Jersey tried to pass sports betting laws in 2012, the various sports leagues filed successive lawsuits to maintain the ban imposed by PASPA. Nevada is not concerned about New Jersey’s ability to license sportsbooks; in many ways, the ban on New Jersey helps Nevada.
A Shortsighted Move?
So far, those behind the stadium initiative promised over half-a-billion dollars in funding, got state and county officials to offer an additional $750 million to the project, and found an NFL franchise to move and contribute $500 million to the development. With those pieces in place, the project group arranged for a vote of NFL owners.
If weeks before a final vote, the funding for Las Vegas’s football stadium is pulled, it will send a message to the owners and leadership of the National Football League, NBA, and Major League Baseball that the business leaders of Las Vegas cannot be trusted. While other initiatives might happen, NFL owners are not as likely to support any other Las Vegas stadium plan.
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