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A Las Vegas Monorail train pulls out of the Sprint Station near the Las Vegas Convention Center November 26, 2007.
Saturday, Feb. 27, 2010 | 2:01 a.m.
Sun Archives
- Las Vegas Monorail officials thinking beyond crushing debt (2-22-2010)
- Las Vegas Monorail could seek partnership with Chinese (2-17-2010)
- Monorail spending expected to be scrutinized at bankruptcy hearing (2-17-2010)
- Las Vegas Monorail bonds downgraded after bankruptcy filing (2-5-2010)
- Las Vegas Monorail argues against bankruptcy as municipality (2-3-2010)
- After all the promises, will taxpayers be stuck with the monorail’s bills? (1-22-2010)
- Judge sets hearing date in Las Vegas Monorail bankruptcy case (1-19-2010)
- Las Vegas Monorail files for bankruptcy protection (1-13-2010)
The court battle over the Las Vegas Monorail bankruptcy is giving the public an unprecedented look at the activities of its board.
The only board meetings open to the public involve approval of the monorail’s annual budget. But the bankruptcy files include minutes that cover many closed-door meetings from January 2004 through last July.
The minutes indicate the board knew for years the monorail was facing dire financial straits. They also note board members discussed using room taxes or seeking other public money to shore up the struggling system. Use of such money would negate promises made to taxpayers that the monorail would not rely on a public bailout.
The monorail’s major creditor, Ambac Assurance Corp. of Wisconsin, provided the minutes to U.S. Bankruptcy Court. Ambac insured the majority of state-issued bonds used to construct the 7.8-mile system east of the Strip.
Some of the minutes are vague. For example, rather than noting exactly what was said, the minutes frequently say “a discussion ensued.”
“The reason is that the minutes are a record of the actions taken or authorized by the board,” monorail spokeswoman Ingrid Reisman said this week.
Despite the lack of details, the minutes include several revealing passages.
Failure to pay $649 million in bonds is the reason the monorail filed for bankruptcy protection in January, and the minutes show Chief Financial Officer Ross Johnson told the board in August 2005 that based on ridership and revenue, the monorail would not be able to pay its bond debt.
In December 2006, President and CEO Curtis Myles told the board he had informed the Nevada Business and Industry Department that the monorail was not in default. But Wells Fargo Bank, which has overseen monorail funds, would later argue in court documents that the transit operator stopped meeting its debt obligations in June 2006.
When Johnson had raised the red flag 10 months earlier, the monorail, which opened in July 2004, had just completed a stormy first year that included mechanical failures that led to shutdowns and ridership below projections.
Still, in that same meeting, after Johnson’s warning, the board approved $80,000 in bonuses for Transit Systems Management employees involved in overseeing monorail construction.
Reisman said the board merely approved bonuses written into Transit System’s contracts before it merged with the monorail company.
The timing of the bonuses does not sit well with Ambac attorney William Smith of Chicago.
“The board has a history of being selective about who they pay, but no one seems concerned about paying off the bond holders,” Smith told the Sun.
One topic that doesn’t come up in the minutes is whether executives’ pay should be reduced, although Myles discussed “staff reductions” in August 2008. According to Internal Revenue Service documents for 2008, salaries included $346,477 for Myles, $146,400 for Reisman and $135,926 for security director Joseph Dorsey.
At the September 2008 meeting, board members cut their monthly fees in half, to $2,500 each, when they reduced their meetings to every other month. (The fee went back up last summer when they started meeting more frequently to deal with “restructuring,” Myles said.) Also at that meeting, the board “agreed to pursue possible funding sources from public entities, though the board noted that any such opportunities are not sufficiently developed ...”
Reisman said that pursuing funding from public sources and revenue from hotel room taxes were ideas pitched by consulting firm Conway, Del Genio, Gries & Co. of New York.
The board hired the firm in March 2008 as its restructuring adviser. At the same meeting, the board sought legal advice about how obligated it was to disclose “the deteriorating financial condition” of the monorail.
In May 2008, the board was told the monorail was generating $3.68 in revenue per ride, but needed $7.50 to $8 to break even.
At that meeting a public relations firm advised the board on how to deal with negative media coverage, including “attempts to isolate the negative influences of certain news outlets.”
Reisman said the discussion was not directed at any particular news outlet or reporter.
“We get fair coverage but clearly if you go back in time, there was a significant amount of coverage that wouldn’t be considered highly positive,” she said.
In August 2008, Myles discussed the possibility of the monorail receiving a portion of room taxes designated for transportation projects. He updated the board on that in January 2009 — the idea had hit a dead end. He went on to sum up the transit operator’s plight by discussing “the lack of any political or resort support for the existing monorail system.”
Bulldoze this mess into the ground..... Close the strip to automobile traffic. They can use Industrial & koval. Run buses, trams & pedestrian walkways on the strip.
Where is the accountability? Who approved this? Who paid for this? Who made money on this? Where are they now? Who is responsible for this? Who will be held accountable for this? ANSWER TO ALL THE QUESTIONS ABOVE: NO ONE. For some reason when hundreds of millions of taxpayer dollars are wasted, no one is responsible. This has happened many, many times. Look at the 100 million dollar expense for Rancho High School. 100 Million for a high school. Come on Nevada, wake up and vote out all the bums in office.
Planetearthcalling :
That is the most ridiculous comment on this issue I have read so far! They tried that down on Fremont Street, and absolutely ruined the fabric of downtown. This rail line can be salvaged with line extensions to the airport and downtown. It just takes a little imagination, something that we used to have in this city, which was snuffed out by the corporate criminals who run the town now..
Who are the board members and what elected officials are on this board or on its advisory board? Is the senior senator from NV associated with its various boards? If so, what have been their contributions (not just in terms of economics) to such boards or committees of the monorail?
Let's see...Build it the rear of the strip. Service only the back-door of only one side of the strip. Don't go to the airport (the main source of tourist arrival). Okay, I understand... this project was a dud from the very beginning. If the government (local, state or federal) bail them out...we should vote them out.
This mess should be razed and everyone who oversaw its planning and construction should go to jail, if for no other reason than their own stupidity. I think some of our local crooks saw a way to make some quick cash and the suckers bought into it. This Myles characture hasn't a clue what's going on and neither do the board. Myles should be forced to repay every dime he was paid.
This thing should never be expanded, it is worthless. No one goes downtown. Downtown is for the winos, whores and bums and everyone knows it. As for the airport, if someone comes into town for vacation with family there are taxi's which will haul five for the same fare as one. That is much cheaper than the monorail. Who wants to get off the monorail when it's 115 in August and try to carry their bags three blocks to their hotel on the opposite side of the strip? The whole concept is assinine. No expansion, no subsidy, no monorail. Good riddance.
jlb101 said: Downtown is for winos, whores and bums. You can find plenty of Whores and bums on the Flamingo street overpass. You don't have go downtown to find them.
The mono-rail isn't viable for all the reasons stated, but what galls me is charging tourists $5.
There is a sign when you walk in stating fare jumpers will be prosecuted. That may be so, but Tourists and conventioneers don't need to be told to be law abiding.
This sign is a slap in the face, and makes you feel like a child. These people couldn't run a lemonade stand.
Supporters of Desert Xpress...be warned the same fate.
From their website: http://www.lvmonorail.com/corporate/boar...
Pat Shalmy
Bruce Woodbury
Bob Beers
Anthony Santo
Mike Sloan
Everybody loves Mr. Woodbury, so don't look for any extensive reporting on this. Besides, the Sun/RJ have had to cut staff to the bone (like everyone in the private sector has), so they don't have the personnel to pursue the story.
It is always disturbing to discover how long boards keep pertinent information from the public. It appears that the public should have been informed back in June of 2006 of the financial state of the Monorail, but this board apparently did not even bother to seek legal advice regarding what should be disclosed until March of 2008. That is extremely deceptive, possibly even to the level of Bernie Madoff ultra sneaky. The fact that the board obtained the services of a public relations firm in May of 2008 (or earlier) suggests to me that the board was a bunch of total yes-men collecting their director fees but doing less than nothing, and then becoming more worried about damage control than solving problems. Incompetent.
environprotector,
Downtown Casino Center was dead and stinking when Jan Jones built that monstrosity. Admittedly she made the place worse off than it already was seeings how downtown had a certain amount of character back than that's now gone forever.
As for the strip, the way it is now, it looks more like a well lit warehouse district than the old Las Vegas Strip we all knew and loved prior to the big box resorts getting built..
With a little remodeling Strip hotels could be accessed by car on koval & industrial, which would leave the strip for better modes of transport running at street level, such as bus & light rail. The light rail would of course connect to the airport and downtown. Buses would handle the over flow traffic.
Bulldoze the tram..they built it in the wrong place.
There is a fund to dismantle the monorail.
Execute that plan.
We do not need to divert more taxpayer money to boondoggles and away from schools and public saftey.
Tear it down and use the materials to build the entryway for the new city hall, which is obviously a much more intelligent and necessary investment of funds.
I knew this would happen before they built it. I called but no one would listen.
When you play with "other" people's money it distorts common sense.
I think Diamonddogg make my point. He says $5 per person to ride the thing (I don't know exactly myself). A family of five will pay $25 to get to several blocks from their hotel. A taxi will take you there for less (unless the driver takes you on the tourist route through Henderson) and unloads the bags so the bell hop can take them to the room. much simpler and cheaper.
Use convention center money to bring the monorail to hotels that want conventioneers. Stop all this excess shuttle bus service that ties up traffic. extend it to the airport and put a baggage handling/delivery service there so you can check your bags to your hotel. And, continue it to downtown. Actually, downtown is more fun than the strip and a lot cheaper too.
jlb:
How many passengers can you fit in a Crown Vic Taxi with 1 driver? A taxi on a 4 mile trip is $11.20 + tip. A family of 5 would be 2 taxis = 22.40 + tips. Even if your a tight wad and only give em $1 each your at about the same. If you plan to make several trips a $14 day pass or $30 3 day pass and you would come out ahead. If you wanted cheaper take a bus pass. Also children under 5 are free.
Discount tickets for Nevada residents are available at all of the Monorail's customer service booths upon presentation of your valid Nevada driver's license, State of Nevada government-issued identification card or Nevada Sheriff's Card. Local fare is $1 per ride. Maximum purchase: two (2) single ride tickets per person per day.
Daily ridership (1st quarter 2008): 22,893. Some of you would rather have a 1,000 more taxis on the road? Not me.
Most people don't realize the monorail works well for people with mobility problems. You can't get a scooter in a Taxi. A visitor could rent a scooter at their hotel such as the Hilton and travel to the MGM without getting up.
There isn't a 'light-rail' or 'monorail' in the country that doesnt run in the RED and require subsidies. Yet the idiot liberals just keep crying to build more.
Not building the Monorail to connect to the airport was the biggest mistake. Had that leg of the track have been completed, things would have been much different. That alone would have spiked ridership enough so that the project could have operated in the black. Never minding the fact that 9 times out of ten tourists who ride the monorail have to ask just where in the world it's at because hotels do such a horrible job with their signage, no one knows where the damn thing is at.
While I'm sure that poor ridership certainly has affected the bottom line of the Monorail, I'd personally call the spending habits of the whole organization into question.
1. Between Bally's and Paris' Parking Garage (under the ramp you drive up) on Audrey lane, there is a whole elevated Monorail Repair Garage. This whole structure was built and then disconnected from the track and is abandoned. Why? If you knew that the end of the line was going to be @ Sahara and Paradise, why on earth was money wasted building that facility?!
2. Off of Koval, under the Flamingo Station, kitty-corner from the Flamingo's Parking Garage and right behind the brown time-share place there is a white Hyundai Santa Fe with a "Las Vegas Monorail" logo on both doors. Only once in the past 3 years have I seen this car move, and I drive by it on almost a daily basis. What in the world is the purpose of this?!? It's not a security patrol car, it's obviously not a Service Vehicle, and no one seems to use it. Why on earth did they buy it then?!?
Questions like this make me less concerned about ridership, and more concerned with Financial Irresponsibility of the board of directors.
"There isn't a 'light-rail' or 'monorail' in the country that doesnt run in the RED and require subsidies. Yet the idiot liberals just keep crying to build more."
You are correct.
So the Feds kick in the money must of time.
Where does it come from? It comes from the Highyway Trust fund which is not keeping up with the maintain Federal roads because a bunch of its money is going to these boondoggles in the cities.
It is crazy. The big cities should be paying their own way and not robbing from the Highway Trust fund.
The monorail crooks have been trying for years to get Fed Highway Fund money but the Feds get turning it down for they feel it is not a true public transit system but a mickey mouse tourist ride.
The monorail was doomed from the beginning when it was built behind the hotels. It should have run right down the middle of the Strip above the median so vistors could see the Strip as it is meant to be seen. Then they could have taken all of the busses off of the Strip relieving congestion. This didn't happen because the taxi companies, resorts and RTC didn't want it. I agree with everyone else, the monorail should be dismantled.
DMC, that facility behind Bally's was constructed because that was the end of the line for years. This monorail system was originally a transit system between MGM Grand and Bally's. Somehow, somebody decided that it would be great to expand it.
I knew from the beginning that the system would never make it. Just watching the ridership between the two properties should have told our State Executives it wouldn't work.
Why doesn't it surprise me that Bob Beers is on the board of this failed boondoggle...
When I first came to vegas and saw the construction of M-rail I thought what a manigficent project. When it was clear that it was not to go to the airport I realized it was doomed as designed. But thier were hard lobbying efforts to see that would never ever happen and so it will become the white elephant that the public will ultimatley foot the bill for. Mark my words our goverment meaning you and I will end up paying for this disaster.
it failed because there was no planned stops at the fountain bleau, echelon or the tropicana wayne newton show
I suppose we in Hawaii can expect the same as we taxpayers will get "Railed". Hold on to your ankles.
My wife and I rode the original monorail line once to and from MGM Grand from Balley's on a hot day and the cabin didn't seem too well airconditioned, hence not many riders. It left us with the impression of much ado about nothing.
A CAT light rail line from the airport to down town along the present monorail route might work after the monorail is torn down.
The light rail where I live in Sacramento is a very successful surface level electric train, part of the regional transportation system which also includes busses. The light rail has been well planned and keeps growing extensions by popular demand, using a mix of federal, state, county, and city funding--tax-payer generated.
Fares alone don't support it, but its impact mitigates comuter traffic congestion and smog which are important considerations.
Its so easy for people to pass judgement while looking in from the outside there are good Honest people working there I should know I'm one of them this job pays my rent and puts food on the table. I have been there 3 years I don't like the way things are coming to light either our future hangs in the balance. The monorail wanted to go down the strip but certain people in position wouldn't allow it so they had to settle, what about the good things there has never been any robberies and we don't take tourist through henderson charging them more money yeah you might have to walk a little to get where your going but hey don't you have to walk to your boarding gate at the airport the last time I flew that's a pretty good walk should we complain?
Have they found the Memo that shows that they, and EVERYONE else, knew that it was doomed as soon as they decided not to connect it to the airport?
I'm willing to swear in court that I said so, back then. I'll also bring with me copies of the RJ, the Sun, LV Weekly, LV City Life, and hell, I would bet even the Mercury wrote about it!!
What can THEY show? Nothing but political PR, butt-kissing, safety failures and a little flash.
Honestly, I've never ridden the Monorail- it wouldn't help when I needed to get to the airport, and anywhere else it went, my car, or the CAT Bus system was a much cheaper alternative. I WANTED to like the idea- really I did. The public-transit options here, are imperfect, at best. But, they have still surpassed the Monorail.
I say we take a look at how much it would cost to extend to the airport. If it's cheaper than the cost of tearing the thing down, do it. We've got to pay for this damned thing anyway- if we do it properly, perhaps we CAN make money out of it, and extend it to where it's useful to US, not just the Casinos and a single corporation. Being able to 'park and ride' from Anthem to Henderson, in 15 mins? Sounds good to me!
Somehow government should stay out of business. They always seem to fail, since business decisions cant be made effectively by a political process.
Anyone with a brain would know that the monorail would fail if it didnt go to the airport and downtown. Without that, why would people take it?
While we are at it, set up a system so that bags at the airport can be tagged before u even get on the plane and brought right to your hotel. All you hve to do is exit the plane, get on the monorail, and it leaves u at your hotel.
Connect it to the airport ASAP....or Kill it ASAP
Is it any surprize that this happens when Obama is in president. I new this would happen soon as he was elected.
as a regular visitor to Vegas I use the monorail
as a fast safe & efficient means of transportation.
I do not know why more visitors do not use it.
I do remember however, that the original cost was
$3.00 per ride one way. Last time it was $5.00 one way. It seems to me that if you want more riders you should keep the price in the same range as the
buses that run the strip. The monorail offers a faster less crowded option for travel. I believe the strip should be shut down for any traffic but mass transit as the buses are always tied up in traffic.
Actually I knew it would be insolvent from the beginning and so testified in a state of Nevada hearing on the subject before the bonds were issued. This should have been a surprise to no-one.
I do admit to having missed by 2 years the date of the final default. However, my ridership estimate was "right on."
See the report at...
http://www.publicpurpose.com/ut-lvmono-0...
Wendell Cox
Principal, Demographia
1. Connect it to the Airport A.S.A.P.
2. Make the trip free and take the money to support it from the Hotel Room taxes.
3. Downtown doesn't really need a connection since as many have said, it is not really a major destination for tourists anymore..
4. Get it done fast!!