The Oakland Raiders are headed to Las Vegas, after NFL owners voted 31-1 at the owners meetings on Monday to approve the move. How did this all come together? Here's a rundown:
It was originally thought that because Nevada is the home of gambling, it would deter the league. What happened?
It is true that NFL commissioner Roger Goodell has publicly been less than supportive of gambling in general, but over time, the owners have moved away from this as an issue. It is comical how the two commissioners who have been most opposed to gambling, NHL commissioner Gary Bettman and Goodell, are the first to have teams in Vegas. The NFL could ask the Nevada Gaming Commission to take Raiders games off the board, but I'm not sure Nevada would fall in line. Allowing that would suggest the gaming industry is not on the up and up. They want pro teams to move to Vegas to boost its credibility, not compromise it. Mobile betting is now prevalent within Nevada, so the question is, would the league care enough to propose some sort of geolocator to prevent betting from stadium grounds?
The Raiders are leaving the No. 6 television market in Oakland for the No. 40 market in Las Vegas. Isn't that important?
Television markets aren't as important as they once were. The NFL is a national game, and local TV deals and overall market size are trumped by a team's share of the national television deal, which will be more than $250 million next season. Plus, when you think about the fact that Buffalo is the No. 53 and Green Bay is the No. 68 television market, it makes this question seem even less relevant.
Is market size in general a concern given the competition for the entertainment dollar?
This is more of a question for the NHL team, which will have to compete with Vegas for 40-plus days a season. The Raiders, in contrast, need to be in demand for only 10 days, and Vegas will now be a huge destination for visiting-team fans. Suites will be swooped up in minutes by casinos that need the ability to offer a premium experience to their best customers.
California has been wary about devoting taxpayer money to stadiums. How is Vegas doing it?
The $750 million of public money toward the $1.9 billion stadium cost is funded through a tourist tax. It will be funded through a $1.50-per-night tax for a hotel on the Strip. It's a tricky way to do it, but it keeps local pressure away, and if there's one city where people won't object to extra charges, it's Vegas, where resort fees and gym fees are common.
It has been reported that Raiders owner Mark Davis doesn't have many assets outside of the team. How did he pull this off without taking on new partners?
Davis has been adamant that he didn't want to dilute his stake throughout the process. That's why the financing fell apart with original lenders, casino billionaire Sheldon Adelson and Goldman Sachs. But Bank of America swooped in with no-strings-attached financing, plus Davis gets a $200 million loan from the NFL. No catches are important to NFL owners, who don't want to have to deal with outside interests. It's why the city of Oakland's last-ditch effort wasn't good enough, because venture capital firm Fortress was going to put up money to build the stadium, and it wanted involvement in team ownership.
What's the relocation fee?
If the Raiders' relocation fee is similar to the Chargers' and Rams', Davis will be able to spread his payment out over time. The relocation fee to Vegas is expected to be less than $400 million compared to $650 million for the Chargers and the Rams. All in, from the three moves, each NFL owner (aside from those of the Rams, Chargers and Raiders, who won't get a piece of their own payment) will have made more than $53 million when the payments are complete.
What has to be resolved?
They don't have any land purchased in Las Vegas and haven't publicly announced a venue plan for the next two seasons as the stadium gets built. It is likely they will continue to play at Oakland Coliseum. The Raiders have two years left on their lease in Oakland.