Las Vegas Monorail didn’t do much for the Sahara
One of the sidebars to the sad news that the Sahara hotel-casino is closing in May is this: What's the impact on the beleaguered Las Vegas Monorail?
As a few people know, the monorail starts at the still-open MGM Grand, and winds its way down the back side of the Strip, eventually coming to the Sahara. A maintenance facility for monorail cars is located near the property, too.
But now, with the Sahara closing, riders will have no reason to journey past the Las Vegas Hilton stop on the monorail's 3.9-mile route. It's ironic, since one of the goals of the monorail was to ferry tourists to certain hotels and thus ensure a steady flow of foot traffic. That's undoubtedly why the Sahara signed on to the monorail in the first place.
Quite unlike the Sahara -- which enjoyed iconic status and was a hugely successful enterprise for years -- the monorail has endured a steadily increasing string of slow-motion failures since it was launched in 2004.
According to the monorail's website, the train carried 5.2 million people in 2010 and brought in $23.3 million. That's enough to cover the cost of operating the system, but nowhere near enough to make payments on the more than $600 million in bonds that built it. Hence, the monorail's January 2010 bankruptcy.
Contrast those numbers with figures from 2005, a banner year for ridership, when the monorail carried 10.2 million people. Or 2006, the highest grossing year for the monorail financially, when it made $31.4 million.
Although the monorail has been mired in legal wrangling since it filed for bankruptcy, its website still advertises a long-held dream: to take the train to McCarran International Airport.
"The Las Vegas Monorail Company is currently in the planning stages of a proposed expansion to McCarran International Airport, which would help deliver Las Vegas visitors to their business and vacation destinations along the Strip," the site says. "This phase of expansion planning includes seeking environmental approval(s), securing appropriate entitlement rights through the Clark County Monorail Franchise and finalizing a ridership forecast for the expansion.
"Check back soon for updates ..."
Realistically, there's only one way the monorail will ever extend to the airport, and that's if it is taken over by the taxpayers. And in this post-recession, Tea Party era, the idea of a publicly owned monorail is about as likely to fly as one of the monorail's trains. Which means we should expect the monorail to make a play for exactly that outcome. This is Las Vegas, after all, home of crony capitalism.
But should the public take it over? Should this example of casino hubris and wildly optimistic ridership and revenue projections be rewarded with a public bailout, like our own little version of AIG or Fannie Mae? Is the Las Vegas Monorail too big to fail?
When the Sahara couldn't attract enough customers (even with the monorail delivering passengers right to its back door) it announced its closure. That's what happens in the private sector, and the monorail still bills itself -- despite tax-free bonds issued by the state and myriad tax exemptions -- as a private enterprise.
Let's not forget a little-discussed alternative: When the monorail was built, some foresighted soul insisted that a fund be created to provide money to tear it down if things didn't work out. While the ultimate decision on what to do with the troubled train will be made by those poor souls who bought the monorail's bonds, if talk of a public takeover comes up, we should all keep in mind that there's another option.
And unlike the Sahara, which had plenty of fans, very few people will mourn the loss of the Las Vegas Monorail.
Steve Sebelius is a Review-Journal political columnist and author of the blog SlashPolitics.com. His column appears Sunday, Tuesday, Wednesday and Friday. Reach him at (702) 387-5276 or at SSebelius@reviewjournal.com.
