Clark County commissioners are balking at a request from the private company behind the Las Vegas Monorail to be on the hook for planned expansions to the Mandalay Bay and the Sands Convention Center on Twain and Las Vegas Boulevard. A planned expansion to McCarran International Airport is also in the works, according to a source close to the discussions.
Las Vegas Monorail executive Curtis Myles told commissioners Tuesday financing has been lined up, contingent on a commitment from the county of $4.5 million for 30 years.
“Every lender we’ve talked to, they’ve all required a two-party agreement,” Myles said.
In 2017 the county approved a non-binding resolution to assist the monorail expansion, if necessary. But County Attorney Mary Ann Miller told commissioners that Myle’s assertion that the financing hinges on the county’s participation places the government on the hook in the event of default.
“We got a lot of pushback when the monorail went through bankruptcy before, and we were very hands-off,” Miller said, noting the county doesn’t make a practice of giving money to private companies. “If you go forward with this you need to know what obligation you’re undertaking.”
“We’re talking about the equivalent of a bond we could use for something else,” said Commissioner Tick Segerblom, who characterized the county’s possible contribution as additional taxpayer commitment to the Las Vegas Raiders Stadium, which is behind the Mandalay Bay. “This is part of what we’re doing to make the stadium work. I’m not sure why we are doing it and not MGM.”
“All the lenders we have talked to have requested, all require us to have a two-party agreement,” Myles told commissioners, meaning the county’s commitment.
Myles said ridership on the monorail is providing potential lenders with a great deal of confidence. But monorail ridership has consistently fallen below projections.
Last year the monorail was expected to generate $25.8 million. Actual revenue was just under $21.4 million.
Myles says Strip resorts have expressed interest in contributing to the financing of the extensions, however he did not provide details.
Correction: The original version of this story mistakenly described the scope of the proposed monorail extension.