Old foe rips plan for convention center

John Wilen

Monday, April 12, 1999 | 11:33 a.m.

The long dispute between Sheldon Adelson and the Las Vegas Convention and Visitors Authority took a new turn today.

In a self-described "sternly worded letter," William Weidner, president and chief operating officer of the Venetian hotel-casino and Adelson's right-hand man, blasted an LVCVA plan to finance an $85 million, 1.3 million-square-foot addition to the Las Vegas Convention Center with prepaid rent from a group of convention tenants.

Weidner said the plan violates a state law requiring voter approval of any LVCVA contract that "creates indebtedness" for the authority. He called for a public referendum on the deal.

Weidner also noted that the Venetian's own convention facility, the Sands Expo Center, generates tax revenue, while the LVCC "absorbs" nearly $20 million in tax money each year in operating costs.

But in a meeting with the Las Vegas Sun editorial board this morning, Weidner brushed aside any suggestion that the Venetian was acting against the LVCC, a competitor of its Sands Expo Center, because the Sands has lost large trade shows to the LVCC. He said the Venetian is getting involved in the issue because it believes the LVCVA's plan to give a consortium of five convention tenants a discount on future rent in exchange for payment now is a waste of tax dollars.

The discounts -- which Weidner says are 37.5 percent below the standard LVCC rental rate of 20 cents per square foot -- ensures that the LVCC will continue to operate at a loss for years to come. And because the discounts are being offered to companies that already hold their trade shows in Las Vegas, the "sweetheart deals" will not attract new business to town. In fact, Weidner argues, the deals will hurt the LVCVA's ability to make new sales by tying up prime convention and meeting dates with the consortium members' shows.

LVCVA spokesman Rob Powers declined to comment on Weidner's specific charges.

The letter and an accompanying news release, Powers said, are "full of inaccuracies and distortions." He said the whole issue will be discussed by the LVCVA's board at a public meeting Tuesday morning.

The heart of the Venetian's argument is a contention that the LVCVA is cutting favorable deals with longtime Las Vegas convention customers at a time when the authority could be charging much higher rates. No other city in the country is as prepared for large conventions as Las Vegas, he argued. He scoffed at LVCVA notions that the sweetheart deals are necessary to keep the conventions here.

"This is the most wonderful convention and meeting facility city in the country," Weidner said. "Go get new business to fill this space. Don't take old business from another facility."

The LVCC is already operating at a loss, and cutting deals that charge large tenants even lower rents ensure greater losses going forward, Weidner said.

"This transaction virtually guarantees future tax subsidies," Weidner said.

If the LVCVA simply went to the bond markets to raise money for the expansion, they would not be open to criticism, Weidner said. But cutting special deals that ensure greater losses in the future gives the Venetian, and others, the right to pursue possible "legal action" against the LVCVA, Weidner said.

The consortium of trade shows that has agreed to pre-pay rent at the LVCC include the Consumer Electronics Show, the Men's Apparel Guild in California show and the Sporting Goods Manufacturers Association Super Show, as well as two smaller trade shows.

Weidner was asked whether the Venetian's actions might be interpreted as sour grapes for its loss of the Consumer Electronics Show to the LVCC via the pre-paid rent deal. Again, he said the Venetian would not have grounds to criticize the LVCVA if they were not offering the consortium a favorable deal.

"Just go finance and build it the way you're authorized to do so," Weidner said.

The Venetian wants a full audit and accounting of the LVCVA's books to see what the consortium financing deal will cost taxpayers over the long run.

Weidner also criticized an LVCVA attempt to avoid the direction of five-eighths of 1 percent of the existing room tax to local schools. That attempt is particularly contradictory, given that the LVCVA's expansion financing deal with the trade-show consortium will cost taxpayers money, Weidner said.

The dispute is the latest between the Adelson-controlled Venetian and the LVCVA. Adelson has long criticized the LVCVA for the way it markets Las Vegas.