A Nevada judge has rejected a legal challenge to the state law establishing a $380 million public financing deal to build a baseball stadium in Las Vegas for the Oakland Athletics, saying the members of the teacher union who filed the lawsuit lacked standing.
In a Friday order, Carson City District Court Judge Kristin Luis did not weigh in on the union’s arguments that lawmakers violated the Nevada Constitution in five ways, including a claim that it would constitute an increase in public revenue but was not passed by the constitutionally required two-thirds majority vote of legislators.
Instead, Luis wrote in her order that the plaintiffs lacked traditional standing and did not meet the required standard for the “public importance exemption” created by the state Supreme Court. Because the parties did not establish proper standing, Luis wrote she could not make a “determination on the merit of the claims.”
“[T]his Court concludes that the Plaintiffs lack standing,” the judge wrote, noting that because the lawsuit doesn’t affect those who filed it and the law establishing the public financing deal has not yet been fully implemented, the court would not rule on the constitutional questions raised in the lawsuit.
The order addressed more than 90 minutes of arguments presented in early August, giving each side 10 days to file their proposed ruling, before issuing her written ruling.
In a statement Friday evening, a media representative for the Strong Public Schools Nevada PAC, which helped bring the lawsuit, vowed to examine legal options, including a possible appeal and support a possible referendum to undo the legislation in 2026.
“We believe the Court made the wrong decision,” the statement read. “This project remains as risky as ever, and the Court even noted the lack of progress on the stadium. Further, the Court did not say whether the stadium deal was Constitutional.”
The lawsuit, brought against Republican Gov. Joe Lombardo and Democratic Treasurer Zach Conine, was the second legal battle surrounding the proposed stadium that a PAC supported by the Nevada State Education Association (NSEA) has lost.
The first involved a challenge brought by two labor leaders of a ballot petition filed in September by Schools Over Stadiums — a separate NSEA-backed PAC. The petition sought to qualify a ballot question to repeal public financing for the stadium.
The labor leaders, who had supported the legislation establishing the deal, won the court battle. The court rejected the NSEA-backed PAC’s proposed referendum language for being “legally deficient” and, at times, “confusing.”
Two individuals and the Strong Public Schools PAC, which is affiliated with the NSEA, filed the separate lawsuit in February, arguing that it threatened funding for public education and could potentially harm students.
Lawyers representing the Las Vegas Stadium Authority and the Legislative Council Bureau defended the legislation, saying no public dollars have yet been spent on the project, and therefore no harm occurred to merit the legal challenge.
In her ruling, Luis wrote that the law passed by the Legislature “does not mention public education or education funding at all,” pointing out that the word “education” is used only four times in “negligible ways” in the legislation creating the funding deal and there’s no provision of the law that indicates money will be diverted from education in a way that violates the Nevada Constitution.
“In this case, the existence of any injury to Plaintiffs or anyone else is purely speculative,” Luis wrote.
The NSEA has vehemently opposed the legislation and criticized the use of public funding for a private stadium deal, echoing sports economists and studies showing that the costs to taxpayers are not worth the benefits. Supporters have said the project will generate jobs, tourism and revenue for the state.
Though the lawsuit is the latest hurdle that the Oakland A’s have cleared in recent months, the stadium’s development is far from finalized.
During oral arguments last month, Kevin Powers, an attorney with the Legislative Counsel Bureau, said there’s a long way to go before any public dollars are spent. The private financing component for the stadium needs to be met, he said, and the development and community benefits agreements need to be approved, along with other requirements, before the public financing portion kicks in.
“If, at any juncture, those agreements can’t provide that, then this legislation for financing doesn’t become operational,” Powers said. “In this case, there’s no injury at all. There’s no issuance of bonds … and there may never be.”
The Las Vegas Stadium Authority approved the team’s community benefits agreement in March but is still negotiating a 30-year lease agreement covering the ballpark, a non-relocation agreement and a development agreement with the team.
Stadium Authority officials said in August that the four contractual agreements with the Athletics covering the ballpark’s construction and operations will be wrapped up by early December, giving Major League Baseball enough time to sign off on the documents, which are due before work can begin on the ballpark.
The A’s have said they hope to break ground on the stadium by April 2025. The closed Tropicana Las Vegas, which sits on the 35-acre location at the southeast corner of the Strip and Tropicana Avenue where the ballpark will be built, is expected to be demolished in October. The stadium will use 9 acres of the site.
Stadium Authority Chairman Steve Hill said the A’s may present the team’s still-in-the-works private financing plan to the board by its Oct. 17 meeting. The A’s will need to finance almost $1.2 billion for the ballpark construction costs. An A’s representative said the team intends to borrow $300 million, but a lender or lenders weren’t named.
The A’s are seeking equity investors to help offset a portion of the $850 million that team owner John Fisher needs to secure for the 33,000-seat, non-retractable-roof ballpark project. Sports financing company Galatioto Sports Partners has reportedly been retained to find investors.
This story was updated on 9/6/2024 at 6:01 to include details about the ruling and other context and again at 6:41 p.m. to include a statement from the Strong Public Schools Nevada PAC.
