Pro Sports in Las Vegas Aren’t Cheered by Everyone

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Pro Sports in Las Vegas Aren’t Cheered by Everyone

The history of Las Vegas has been marked by a relentless expansion of hotels, casinos, theaters and restaurants. But only recently have major professional sports teams appeared in the urban landscape.

The Golden Knights of the National Hockey League were the first to begin playing here in 2017. The Aces of the Women's National Basketball Association started in 2018 and the Raiders of the National Football League arrived from Oakland in 2020. Last year it was Major League Baseball's Athletics. After getting the green light to make the same move from Oakland to Las Vegas, the National Basketball Association is expected to add a team in the coming years.

The transformation of Las Vegas into a professional sports city reflects not only the leagues' interest in the city and their general acceptance of sports betting, but also the power of the region's primary economic driver, tourism. No other major city in the United States is so dependent on a single industry, and a broad coalition led by the leading resort operators has helped secure lucrative subsidies to build new stadiums with the intention of attracting out-of-town visitors would follow.

Those efforts will be on display Sunday when Allegiant Stadium, home of the Raiders and built in part with public money, hosts Super Bowl LVIII between the Kansas City Chiefs and San Francisco 49ers.

“Our role here and what Vegas offers is a platform for people with great ideas to come and make them happen,” said Steve Hill, president of the Las Vegas Convention and Visitors Authority and the man most responsible for it to attract teams to the city. “We are a destination that tries to say yes.”

However, not everyone has adopted this strategy. In Las Vegas, the decision to allocate public money to private teams has heightened scrutiny of state funding of key social services, particularly for education in the nation's fifth-largest public school district, with about 300,000 students.

This week, a group of Nevada teachers sued the state and its Gov. Joe Lombardo, challenging the constitutionality of a law passed last year to financially help the A's build a stadium. Mr. Lombardo's office did not respond to a request for comment on the lawsuit.

“It's really about the haves and the have-nots,” said one of the plaintiffs, Christina Giunchigliani, who was the only member of the seven-member Clark County Commission to vote against funding for Allegiant Stadium in 2016. “If they really wanted to diversify the economy, does sport add a component? Yes. But they didn’t need any public tax money for that.”

However, the fight against the region's economic engine is a tough sled. Lawmakers have been trying to diversify the economy for years, but Las Vegas remains dependent on tourism. Almost 41 million people visited it in 2023.

Economists almost universally say that publicly funded stadiums don't pay for themselves. Mr. Hill acknowledges the skepticism but insists that Las Vegas is different because most of the subsidies are funded by hotel taxes paid by out-of-towners.

“A lot of places build stadiums for community development reasons, and God bless them, but it's not really an economic benefit,” Mr. Hill said in his office filled with memorabilia from groundbreakings and ribbon-cuttings. “But here, so many people come to Las Vegas for the events at the stadium.”

Mr. Hill has spent the last decade leading efforts to diversify an economy prone to booms and busts. He came to Las Vegas in 1987 to manage a cement company, marking the beginning of an era of unprecedented construction. He later became active in the Chamber of Commerce and industrial groups that advocated for the city's rapid growth. He also raised money for Brian Sandoval, who was elected governor in 2010 and put Mr. Hill in charge of the economic development office.

After convincing Apple, Tesla and other companies to move to northern Nevada, Mr. Hill was tasked with boosting tourism in southern Nevada in 2015 by trying to expand the convention center and build a stadium to house a soccer team to lure you to Las Vegas. He got county and state brokers to commit $750 million to help the Raiders build Allegiant Stadium. And as president of the Convention and Visitors Authority since 2018, he has organized a Formula 1 race and helped win support for $380 million in public subsidies for the baseball stadium the A's want to build. (The Golden Knights did not use public money to build their arena.)

One of Mr. Hill's skills was balancing powerful business interests in Las Vegas, particularly the resort and casino operators and the food service workers union.

“Steve was critical because of his background,” said Bill Hornbuckle, chief executive of MGM Resorts International. “He knew the right cast of characters.”

Mr. Hill heads both the convention board and the stadium board, prompting criticism that he has so much power that he can push through deals that benefit the business community at the expense of residents.

“There aren't really the checks and balances that I would like to see when it comes to public policy and Steve Hill and his organization,” said Michael Schaus, a columnist at The Nevada Independent. “The people who cheered for this football stadium are the same people who were involved in actually making it happen.”

Mr Hill disputed the criticism and said he had declined to process funding requests when there were potential conflicts of interest. In Mr. Hill's view, the subsidies spent on Allegiant Stadium were money well spent. About half of the fans who attended games, concerts and other events at the stadium came from outside Las Vegas, nearly double the original projection (27 percent). Most of them paid hotel taxes, ate out, rented cars and gambled in casinos, he said.

But JC Bradbury, an economist at Kennesaw State University in Georgia, said that dollars spent on stadiums would otherwise be spent elsewhere in the city and that the bulk of profits from stadiums often went to the teams that leased them. Some visitors also avoid Las Vegas when the city hosts football games and other major events because hotel room prices often skyrocket.

“People understand causation backwards,” Bradbury said. “People say they’re a big city because they have a team. No, they were a big city before and that’s why the team went there.”

The question then becomes what else the county and state could do with the money from various taxes. For years, schools and other social services in the region, funded by sales and property taxes, have not been able to keep pace with the growth of the tourism industry. Nevada ranks near the bottom of the country in class size and per-pupil spending, child care spending and environmental quality, and tops in gambling and drug addiction.

Vicki Kreidel, a plaintiff in the A's funding lawsuit, teaches reading a 20-minute drive from the Strip at Lomie G. Heard Elementary School, a public magnet school where 100 percent of students are economically disadvantaged. The students she works with have primarily learned a language other than English and need help in small groups because they read below their grade level.

Still, Ms. Kreidel said reading centers like the one at her school exist in relatively few elementary schools in the Clark County School District. Teachers describe a lack of resources to support their students and facilities that are aging and in need of repairs, which a district spokesman attributes to inadequate funding from the state. There are more than 1,300 teaching positions available, the district added.

Ariane Prichard, a ninth-grade biology teacher at Bonanza High School, said her average class size was 36 students because of the district's teacher shortage. She and other members of her department had to use their prep time to teach an additional section to keep class sizes from growing. They get paid for the additional course and then do the preparatory work in their own time.

Last year, Ms. Kreidel, who is president of a local affiliate of the statewide teachers union, advocated for more funding for public schools during Nevada's biennial legislative session. A 2023 report from the state School Finance Commission showed the state spent about $4,000 less per student than recommended. The Nevada Department of Education welcomed the passage of the state's largest education budget in May, but the budget failed to close the per-student deficit.

A few weeks later — a day before he vetoed a bill that would have given students free breakfast and lunch for all — Mr. Lombardo signed the $380 million public funding bill for the A's stadium. Ms. Kreidel called this decision a “knife in the gut.”

She said she vowed never to set foot in Allegiant Stadium. Another elementary school teacher in the district, LaTasha Olsen, tries to avoid driving past it at all.

“It makes me angry every time,” Ms. Olsen said. “I didn’t go to the stadium. I don't want to go to the stadium. No.”

She added: “It just shows we don’t care. We don't care about teachers. We don't care about our students. Our tourism is important to us.”