Monorail work to begin in October

Cy Ryan and Adrienne Packer

Tuesday, Aug. 29, 2000 | 11:31 a.m.

CARSON CITY -- A nonprofit company planning a multimillion-dollar monorail along the Las Vegas Strip told the state Board of Finance today that it intends to begin selling bonds Sept. 20 and break ground in October.

The Board of Finance met this morning to determine whether to grant the company's request for $650 million in tax-free bonds.

Though dozens of hearings have been held on the system during the last two years, today a key element was absent: strong opposition.

The Venetian hotel-casino, which has invested thousands of dollars in its fight against the extension of the MGM Grand-Bally's monorail, announced it will no longer protest the project.

Attorney Lance Earl, who has represented the Venetian during its lengthy battle, said today that most concerns were erased when the monorail group confirmed its first-tier bonds -- about $450 million worth -- were insured.

"That provided a great amount of comfort that we've been asking for a long time," Earl said. "It guarantees the bondholders will be paid, and it takes the state out of the picture."

The state Department of Business and Industry and the Clark County Commission placed several conditions on the project, which also satisfied the Venetian, Earl said.

Bob Broadbent, one of the directors of the Las Vegas Monorail Company, confirmed today there will "still be a lot of hurdles," for the project if the board approves the issuance of the bonds.

Sydney Wickliffe, director of the business and industry division, told the board she would remain "the state's watchdog to make sure it is a viable project."

State Treasurer Brian Krolicki asked a number of questions of the monorail group to ensure the state and Nevada taxpayers won't be responsible for any debt if the monorail is not successful.

Securing the insurance policy boosts the bond ratings from a BBB to AAA, meaning the monorail company will have to pay less interest when it sells the bonds, Wickliffe said.

Broadbent estimated that would save 1 percent interest in the sale.

Greg Jensen, the monorail company's attorney, said lawsuits related to the proposed system have been dismissed and added that the project is "bullet proof legally."

Early in the process, supporters of the monorail claimed the Venetian opposed the project because the hotel-casino feared the system might take business away from its own Sands Convention Center.

Earl emphasized today that the Venetian was truly concerned that taxpayers might be left paying for the system should it fail.

"I hope the taxpayers do believe the Venetian's motive was to benefit the community and that it did," Earl said. "Because the Venetian raised concerns and because it did so so strongly, the project is a better project than when it was started. The state is better protected."

Jensen and Wickliffe agreed that opposition from such groups as the Venetian, helped improve the project. Wickliffe said the opponents "kept the people's feet to the fire" in making sure all the requirements were met.

If approved, the monorail would extend from Bally's north on the Las Vegas Strip to the Flamingo Hilton, Imperial Palace before turning east on Sands Avenue. It would veer north on Paradise linking the Las Vegas Convention Center to the Las Vegas Hilton and the Sahara hotel-casino.