• Skip to main content
  • Skip to secondary menu
  • Skip to primary sidebar
  • Skip to footer

Nevada Business Magazine

The Decision Maker's Magazine

Subscribe Now!

  • Subscriptions
    • Print
    • Mobile App
    • Email
    • Nevada News & PR Wire
  • Features
    • New This Month
    • View Issues
    • Cover Stories
    • Feature Stories
    • Industry Focus
    • Building Nevada
    • Special Reports
    • Press Release Wire
    • Nevada Industries
  • Departments
    • A Matter of Opinion
    • Around the State
    • Business Indicators
    • Commentary
    • Commercial RE Report
    • Crossfire
    • Expert Advice
    • Face to Face
    • Free Market Watch
    • Inside Politics
    • Power of Attorney
    • Profit & Loss
    • Speaking for Nevada
    • Tech.knowledge.me
    • The Last Word
    • Vital Signs
  • Planning Calendar
  • Advertising
    • Advertising Info
    • Advertising Staff
    • Submission Requirements
    • Online Advertising
  • Events
    • NBM Events
  • About
    • About the Magazine
    • Contact the Staff
  • Connect
    • Business Directory
    • Press Release Wire
    • Business Calendar
    • Submit Listing
    • Post Press Release
    • Add Your Event
    • Sign Up
    • Log In
You are here: Home / Departments / Free Market Watch / Why Government Shouldn’t Pick Winners and Losers: City Council Considering Plan to Subsidize Private Arena Developer

Why Government Shouldn’t Pick Winners and Losers: City Council Considering Plan to Subsidize Private Arena Developer

March 1, 2014 By Chantal Lovell Leave a Comment

Imagine watching an NBA game. With the Los Angeles Lakers leading the Boston Celtics 95 to 82 in the fourth quarter, the referees stop the game and award the Celtics 15 of the Lakers’ points and make the score 97 to 80 with the Celtics now leading.

That would be outrageous and unjust, wouldn’t it?

The Lakers earned their points, and it would be wrong for the supposed-to-be-neutral refs to award those points to their competitors.

Absurd as this scenario might seem, it’s analogous to what the City of Las Vegas would be doing if it moves forward on a proposal to publicly subsidize a downtown sports arena. It would be picking winners and losers in the economy by taking tax dollars from certain private businesses to subsidize their competitor.

The Las Vegas City Council recently agreed to give the Baltimore-based Cordish Companies a four-month extension on arranging financing for a future arena on city-owned land. Cordish has proposed building a $390 million arena with $151 million from the company, $187 million in taxpayer-backed bonds and $52 million from a source to-be-determined.

Aside from picking winners and losers in the economy, this agreement would put taxpayers on the hook for over $187 million in bonds plus interest, while directing profits to a single private company. This would affect taxpayers for decades to come.

The pitfalls that come with the government assisting businesses to compete with already existing companies are not hypothetical. They have been all too real in the City of Reno.

In 2009, Reno opened a new ballpark for the Reno Aces. The beautiful ballpark came with a $55 million short-term loan and a commitment from the Reno Redevelopment Agency (RDA) of a subsidy of at least $1 million a year to refinance and then pay off the new loan. When the economy and property values crashed, however, the RDA ran out of money.

Who’s making up the difference? Taxpayers.

Last year after team owners threatened to leave, the City of Reno agreed to pay $1 million in general fund monies annually for 30 years to help pay off the stadium.

Meanwhile, Washoe County officials are trying to recoup nearly $1.7 million in back property taxes from the project’s developer. Given the nuances of a public-private partnership such as this, the legal remedies to recoup public losses are limited. The developer, however, is confident he can resolve the tax debt — at which point he intends to approach the county for another public subsidy, this time for $15 million.

The problems of publicly funded arenas stretch well beyond Nevada. Communities that venture into the stadium-subsidizing business have a history of coming out on the losing end. Time and time again, government officials and bureaucrats invest the taxpayer’s money into a sports venture, only to have the grandiose promises of neighborhood revitalization and economic stimulation fall flat.

The $187 million in bonds proposed for the Cordish project are projected to be repaid through stadium revenue. But the past performance of publicly subsidized stadiums like the Aces’ ballpark shows that actual revenue almost always trails behind overly optimistic projections. Then the public is left to foot the bill.

What makes these potential subsidies worse is that the Las Vegas area already boasts several arenas, and MGM Resorts International and AEG even plan to break ground on a new and privately financed sports arena on the Strip later this year.

How could a city government justify taking money from one company and giving it to its competitor?

It can’t. Not only does history show that government subsidies to businesses are economically foolish, they’re also as fundamentally unjust as a ref awarding the Celtics points scored by the Lakers.

If we wouldn’t allow it in a basketball game, we shouldn’t stand for it in real life either.

Chantal Lovell is deputy communications director at the Nevada Policy Research Institute.

Filed Under: Free Market Watch Tagged With: AEG, Boston Celtics, Chantal Lovell, Cordish Companies, Las Vegas business, Los Angeles Lakers, MGM Resorts International, NBA, Nevada business, Nevada Policy Research Institute, Reno Aces, Reno business, Reno Redevelopment Agency

Sponsored Features

Sponsored Features

Sun City Anthem HOACashes in on Water Savings

U.S. Bank’s Good TruckComes to Las Vegas

GC Garcia, Inc. Celebrates 25 YearsAnd Looks Back on Southern Nevada’s Changing Landscape

Las Vegas Valley Water DistrictSupports Local Fire-Fighting Efforts

Advertise With Us

Advertise With Us. more details ►

Primary Sidebar

Education OutlookBig Issues and Hard Work for K-12

Industry FocusBuilders & Developers

Industrial SubmarketDemand Over Pandemic

Cyber SecurityKeeping Your Business Safe

Nevada News & PR Wire

  • Las Vegas-Based Pandmedic Solutions Donates 10,000 Face Masks to Non-Profit Core and Two Opportunity 180 Schools

  • Korin Woods Named Executive Director of Nonprofit UNSHAKEABLE

  • CSN First-Generation Student Named Regents’ Scholar – the Honor Includes a $5,000 Award

  • Cure 4 the Kids Foundation Tees up 9th Annual Golf 4 The Kids

  • Call for Proposals for Two Visit Carson City Murals

  • Northcap Commercial Arranges Sale of Azure Park Apartments for $2,854,000

  • Special Olympics Nevada to Host 2021 South Lake Tahoe Plunge at Round Hill Beach Resort

  • City of Las Vegas Launches Smart Curbside Management Corridor with Cox

  • De Castroverde Law Group Announces Winners of Its Fall 2020 Teacher Appreciation Awards

  • NAIOP Southern Nevada Urges Congress to Pass the Southern Nevada Economic Development and Conservation Act

  • Dueling Axes Announces Spring Specials and Weekly Programming

  • Desert Radiology Receives Renewal as Diagnostic Imaging Center of Excellence From American College of Radiology

  • Junior Achievement of Southern Nevada Announces New Board Member Hilary Nelson of Lexicon Bank

  • Cure 4 the Kids Foundation Recognizes Founder Annette Logan-Parker – Dr. Suess-Themed Patient Examination Room Dedicated During Nevada Reading Week

  • Local Business Owner Accepted Into Goldman Sachs 10,000 Small Business Program

  • James M. Wright Named Chief Marshal for the Nevada Appellate Courts

  • CAMCO Employees Demonstrate Their Giving Hearts in February

  • Nevada Donor Network Applauds AOPO’s “50,000 Organ Transplants by 2026” Campaign that Focuses on Improving System and Saving More Lives

  • Reno Aces and Greater Nevada Credit Union Help Youth Sports Return to Play

  • Diversity in Practice Panel to Explore Middle Eastern/South Asian Representation in Law

  • Founder of “Gracefully Greying”, Family Attorney Henry S. Gornbein Joins Lipson Neilson as Of Counsel

  • La Strega’s Weekend Fish Market Continues, Scheduled for Sun., Mar. 7

  • Prominence Health Plan Advises Nevadans to Protect Themselves from Medical Scammers

  • A Virtual Restaurant and Fast Casual Concept Set to Debut in Henderson

  • Suit up and Help End Childhood Cancer With St. Jude Children’s Research Hospital®

  • Faith Lutheran Middle & High School’s Conservatory of the Fine Arts Presents Filming the Arts – Student Showcase Proceeds Benefit Renowned Fine Arts Program

  • Carson City Named Top Place in America to Travel Right Now and Avoid the Pandemic by Forbes

  • Wolf, Rifkin, Shapiro, Schulman & Rabkin, LLP Relocates its Reno Office

  • De Castroverde Law Group Awarded Las Vegas Latino Bar Association Inspira Award

  • Virtual Poker Tournament with “Poker Brat” Phil Hellmuth Will Benefit Junior Achievement of Southern Nevada Mar. 13-14

  • Future Smiles Receives Unrestricted $25,000 Program Grant From LIBERTY Dental Plan of Nevada

  • Desert Radiology Encourages COVID-19 Vaccination Among Team Members and Community

  • Northcap Commercial Arranges Sale of MCR Apartments for $6,800,000

  • Helix Electric Announces Completion of Meow Wolf’s Omega Mart

  • Brooke Conway-Kleven Leads Cure 4 the Kids Foundation Physical Medicine Department

  • Coral Academy of Science Las Vegas Accepting Enrollment Applications Through Feb. 28

  • JING Las Vegas to Host Wine Tasting Tuesdays, Every Tuesday Beginning Tues., Feb 23

  • Reno Public Market’s Nettie Oliverio Elected as Pioneer Center Board Chair

  • Alaskan-Born Neeser Construction Expands in Reno-Tahoe

  • More Matcha on the Menu: Dunkin’ Debuts Blueberry Matcha Latte and New Matcha Topped Donut

  • Las Vegas Local Businesses Celebrate with February Events Margarita Day, Happy Hour Specials, Wine Pairing and Charitable Fundraisers

  • Wolf, Rifkin, Shapiro, Schulman & Rabkin, LLP Relocates its Las Vegas Office

  • Supreme Court to Consider Creating Commission to Study Water Adjudication

  • WGU Launches Initiative to Remove Barriers for Students With High Financial Need and Those Without Access to Federal Financial Aid

  • Applications Open for Nevada State College’s Newest Summer Bridge Program Designed for Incoming Black Students

  • Silver State Schools Credit Union Announces 2021 Scholarship Program Available To Graduating Nevada High School Seniors

  • Broadbent & Associates, Inc. Names New Director of Engineering

  • Nathan Adelson Hospice Names Cheryl Johnston as Clinical Manager for Pahrump Location

  • Former Las Vegas Police Officer Offers Help To Local Residents

  • Statewide Partners Unite to Facilitate Equal Vaccine Access Through Nevada Vaccine Equity Collaborative

  • Nevada Small Business Development Center Presents The Top 5 PPP Myths, Busted!

  • Jewish Nevada and Jewish Family Services Agency (JFSA) Team up to Launch Hebrew Free Loan Program to Assist Nevada’s Jewish Community

  • Cassie Catania-Hsu Accepted Into NAIOP Research Foundation Visionaries Program

  • Ascent Multifamily Now Offers Corporate Accounting

  • Nevada State Contractors Board to Hold 2nd Annual ‘Hammers & Hope’ Event

  • TMC Financing Helps Eby Iron Designs Secure Future with Building Purchase

  • Economic Impact of COVID Closures White Paper Published

  • ioneer and Caterpillar Complete Autonomous Haul Truck Feasibility Study and Sign Memorandum of Understanding

  • United Pain Urgent Care Launches in Reno

  • Terra Contracting Launches New Service Offering; Public Utilities to Save Millions

  • In Plain Sight Marketing Ditches Brick and Mortar Digs, Goes Virtual

  • Eleven Lipson Neilson Attorneys Receive AV Preeminent® Rating for 2021

  • Nevada Supreme Court Appoints Katherine Stocks as Director of the Administrative Office of the Courts and State Court Administrator

  • Cold Brew With Sweet Cold Foam and Chocolate Stout Cold Brew With Sweet Cold Foam Arrive at Dunkin’ Restaurants Nationwide on February 24

  • Desert Radiology Continues to Hire for Several Available Positions

  • Dr. Phillip Ruiz Joins Nevada Donor Network as Associate Laboratory Medical Director

  • Colliers Las Vegas Represents Sale of Undeveloped Land in North Las Vegas

  • Special Olympics Nevada to Host 2021 Las Vegas Polar Plunge at Cowabunga Bay

  • G.C. Garcia, Inc. to Host ‘Reading to Rescued Dogs’ Books & Pet Supplies Donation Drive to Benefit Spread the Word Nevada & Heaven Can Wait Animal Society

  • Steinberg Diagnostic Medical Imaging and SR Construction Break Ground on New Facility

  • Sandeep R. Pandit, M.D. Brings Hip and Knee Expertise to Crovetti Orthopaedics

  • NV Energy Foundation Provides $550,000 to Support Scholarships, Workforce Readiness & Student Emergency Fund. the Funds Will Provide Scholarships and Aid to Hundreds of CSN Students

  • NAIOP Southern Nevada Presents “Land: Why Our Future Depends on It” at Feb. 18 Virtual Breakfast

  • Concrete Slabs Poured at Latest Brass Cap Development Industrial Project in West Henderson

  • The Discovery Welcomes New Board Members

  • Deryk Engelland Joins the 8 News Now Team

  • Dress for Success Southern Nevada Welcomes Norma Intriago as Executive Director

  • Lutheran Social Services of Nevada to Celebrate Opening of Expanded DigiMart™ Food Pantry – Feb. 16 Ribbon Cutting Will Celebrate Completion of Expansion That Will Serve an Additional 5,000+ Families Annually

  • NAIOP Honors Southern Nevada Chapter With Three National Awards

  • Zero1 Off-Road, LLC Acquires Vegas Off-Road Tours, LLC and Transfers the Existing RZR Off-Road Experience to “Vegas Off-Road Tours”

  • Dermody Properties Promotes Kimberly Rossiter to Director of Property Management, West

  • RSAR Releases January 2021 Existing Home Sales Report

  • PureCare Living’s Newest Skilled Nursing Facility Enters Final Phase of Licensing

  • LPGA Pro Gigi Stoll Joins Reflection Bay Golf Club

  • Northcap Commercial Arranges Sale of 2566 Sherwood Street Apartments for $1,700,000

  • Business Continuity Technologies Protecting Las Vegas Business From Cyberattacks

  • MassMedia Marketing, Advertising and PR Signs Circus Circus Hotel & Casino Las Vegas

  • Colliers Las Vegas Industrial Team Sells Out Six-Unit Industrial Complex Valued at $6.6m During Pandemic

  • Tuscan Highlands Opens Second Round of Nominations for Valley’s Top First Responders

  • The Las Vegas Business Academy Announces Allyson Bunker and Candace Davis-Martin as New Board Members

  • Southern Nevada Housing Market Starts Year With Prices Still Rising

  • Two University of Nevada, Reno Graduates Earn Certificate in Principles of Public Relations

  • Reno Sportsdome Partners With Swift Orthopedic Urgent Clinic

  • Nevada State College Ranks #2 in Nationwide Search for Best Elementary Education Degree

  • College of Southern Nevada & City of Las Vegas Partner to Offer Education, Workforce Training in Historic West Las Vegas

  • Future Smiles Receives $10,000 Gift From Dentaquest – Nonprofit Will Use Funds to Support Local Children in Need of Critical Dental Services

  • Colliers Las Vegas Retail Broker Chris Clifford Promoted to Senior Vice President

  • Silver State Schools Credit Union Increases Share Insurance Coverage Up To $500,000

  • Lamar Advertising of Las Vegas to Honor African American “Firsts” Throughout Black History Month

  • ioneer Welcomes Rose McKinney-James as Non-Executive Director to its Board



 
Submit Your News & PR | Subscribe
Submit Your News & PR

Business Connection

Business Connection Portal

Log In Sign Up

Business Connection Portal

Log In Sign Up

Nevada Business Calendar

  • Ely Film Festival 2021
    March 12, 2021 12:00 pm

    Location: 501 E Aultman St, Ely, NV 89301, USA

    More details...
  • Play 4 JA Virtual Poker Tournament
    March 13, 2021 12:00 am

    More details...
View Full Calendar ►

Nevada Business Directory

Featured Businesses
Find a Nevada-Based Business Submit Your Business Subscribe to the Nevada News & PR Wire

Nevada Industries

Architects & Engineers
Arts & Culture
Banking
Commercial Real Estate
Construction
Credit Unions
Economic Development
Education
Financial Management
Healthcare
Human Resources
Insurance
Law
Manufacturing
Marketing
Media
Mining
Philanthropy
Residential Real Estate
Rural Nevada
Sports
Tax Planning and Accounting
Technology
Telecom
Tourism
Transportation
Utilities

Footer

Subscriptions

  • Print Subscription
  • Mobile App
  • E-mail Subscription

Editorial

  • Features
  • Departments
  • Events

Advertising

  • Advertise
  • Submission Requirements

Connect

  • Contact
  • LinkedIn
  • Facebook
  • Twitter

Copyright © 2020, Business Link LLC dba Nevada Business Magazine and Nevada Business Journal. Privacy Policy | Terms & Conditions
Nevada Web Design services by Nevada Central Media using Genesis Framework by StudioPress