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Las Vegas Monorail Near Financial Default

Posted on Sunday, September 23, 2007 at 02:07PM by Registered CommenterJerry Wilson | Comments1 Comment

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Las Vegas Strip
Monorail may be near financial default
The Los Angeles Times
Article Last Updated: 09/17/2007 11:47:23 PM MDT

 
The privately operated Monorail system is four miles long... (Myung J. Chun/The Los Angeles Times )
LAS VEGAS - Can the Las Vegas Monorail double down to avoid going bust?

    Three years after beginning operations, the 4-mile, $650 million private rail line that stretches from behind the MGM Grand to the Sahara hotel-casino is attracting about 22,285 riders a day - far below the 54,000 predicted when the project was launched.

    This summer, Fitch Ratings downgraded the Monorail's bond rating, already in junk status, and said financial default appeared probable.

    But Monorail officials say what they need to boost ridership and generate profit is a $500 million extension to McCarran International Airport.

    ''With more than 40,000 new hotel rooms being built, more travelers heading to Las Vegas each year and the intense gridlock on the Strip, an alternative to traditional transportation is critical,'' said Ingrid Reisman, vice president of the nonprofit Las Vegas Monorail Co.

    The Monorail system, which began as a joint venture between MGM Grand and Bally's, was acquired in 2000 by Las Vegas Monorail, which was formed to develop, own and operate the trains.

    So far, officials have not said how they would fund the expansion - or even how they plan to pay off the bonds that funded the current line.

    In December 2006, the Clark County Board of Commissioners approved a 75-year franchise agreement and land use permit to extend
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the Monorail to the airport.

    But no provisions were made for funding.

    The Monorail, tucked behind the Strip and accessible only after long, winding walks through casinos, is hard to find. A Las Vegas Sun newspaper reporter counted the steps from the Harrah's casino entrance to the Harrah's Monorail stop and came up 551 paces.

    That's about the same number of steps it would take to walk to the next stop on the Monorail line, but without the $5 fare.

    At $5 per ride or $9 for a day pass, some passengers said it was less expensive and more convenient for a small group to catch a cab.
 

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Reader Comments (1)

The Casinos run Vegas and they have little interest in moving people out of their Casinos.

The Monorail was doomed the minute the Casinos said no to putting it down the center of the Strip.
September 24, 2007 | Unregistered CommenterUC

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