In search of a site, arena task force needs ideas

Friday, July 14, 2006 | 7:37 a.m.

Finding a suitable site for a new arena is the first of a series of hurdles for the task force studying the possibility of building a state-of-the-art events center in the Las Vegas Valley.

The task force - composed of local gaming executives, event organizers, UNLV officials and local government staffers appointed by the Las Vegas City Council and Clark County Commission - will issue a request for information from landowners today along with minimum requirements for prospective sites. The goal is to develop a master list of locations for the events center.

Requirements include a minimum of 6.5 acres, plus about three acres for 1,500 VIP parking spots for suite and club seat ticket-holders. Another 6,000 parking spaces must be available nearby. In all, officials anticipate a site of 11 to 16 acres.

A small number of property owners, access from an interstate within two miles and accessibility to major casinos and hotels are other criteria.

A consultant hired by the task force will collect submissions until Aug. 18.

In addition to private owners, the city and the county are scouring their land inventories for potential locations.

Assistant Clark County Manager Virginia Valentine said no sites immediately jump to mind. Much of the county's land has restrictions attached to it that would prohibit its use as an arena, she said.

Las Vegas City Manager Doug Selby said city staff is examining several potential locations, and topping the city's list is a site formerly proposed for a City Hall expansion near the corner of Las Vegas Boulevard and Stewart Avenue.

The city has acquired most of the site, with the exception of a gas station and some abandoned housing, Selby said.

Land is only part of the equation, though.

A look at six recently built facilities similar to what local officials are considering here reveals that tax hikes seem to accompany arenas.

The six arenas - suggested as comparable facilities by the task force's consultant - have all been built since 2002 and cater to 17,650 to 20,000 spectators, roughly the same crowd officials hope to host here in a new state-of-the-art events center that would replace the Thomas & Mack Center.

The cost of similar venues in San Antonio; Houston; Charlotte, N.C.; Glendale, Ariz.; Kansas City, Mo.; and Memphis, Tenn., ranged from $195 million to $308 million, averaging $253 million.

Las Vegas Mayor Oscar Goodman has said at least two private parties are interested in building an arena with private money, but taxpayers have footed most of the bill in those six cities.

Tax hikes paid $131 million to $256 million of the costs in those cities. On average, taxpayers provided about 70 percent of the funding for the six arenas.

Most of those taxes came in the form of sales tax, rental car tax and hotel room tax - sources that many officials here feel have already been tapped.

"We may be where we want to be on those," Valentine said. "I think the financing is a real challenge. I wouldn't call it impossible, but it certainly does have some challenges."

Even the task force's consultant, Bill Rhoda of Dallas-based Conventions, Sports & Leisure International, couldn't name a city where an arena had been entirely privately financed.

"These types of venues are difficult to build with 100 percent private money," he said.

One potential source of funding is tax-increment financing. Under that structure, new tax money generated by a project's positive effect on land value in the area is used to help finance the project.

That method can only be used in a redevelopment area, though. The land proposed by the city would qualify, because it sits in the roughly 3,000-acre downtown redevelopment zone.

Although it would be relatively new territory, Rhoda said he shares the mayor's optimism about private financing.

"I think Las Vegas could be an exception," he said. "It's a little different in that Las Vegas carries its own image and brand that most other cities don't have."

Local officials are quick to note that Las Vegas hosts more special events than any other city. They believe that could drive revenues such as naming rights, suites, club seating and interior advertising.

Market considerations such as those are all part of what Rhoda is studying for the task force.

His conclusions about the feasibility of a new arena are expected by early October. His analysis will include the potential impact of bringing a professional hockey or basketball team to Las Vegas.