Monorail settles creditors’ objections, but judge presses questions
After a daylong hearing on Monday, U.S. Bankruptcy Court Judge Bruce Markell deferred ruling on the Las Vegas Monorail’s plan to exit from Chapter 11 bankruptcy.
Prior to entering the courtroom, monorail attorneys has secured support from all the creditors involved in the case. In general, bondholders who put up $659 million a decade ago to construct the 3.9-mile long line will have that amount shaved down to $44.5 million.
However, Markell cross-examined witnesses about his own concerns that the repayment plan still left the transit line financially unstable. In particular, he worried that the after-bankruptcy would be more than double the line’s the estimated value and that projected income would fall well short of debt service plus the cash needed to pay for critical equipment overhauls needed in 2019.
The monorail managers count in three factors to plug the financial gaps: increased ridership stemming from the Project Linq shopping and entertainment complex proposed by Caesars Entertainment Corp., more passengers from a reopened Sahara and greater access to federal funding because the postbankruptcy debt will be more than 90 percent lower than current levels.
Markell did not specify when he would complete a written ruling.
Contact reporter Tim O’Reiley at
toreiley@reviewjournal.com or 702-387-5290.