The Nevada Supreme Court — in an order filed today — has invalidated the initiative petition filed by a group affiliated with Caesars Entertainment aimed at getting a sports arena built on the Strip on donated land behind the Imperial Palace.
According to the order, the initiative’s description of effect is “deceptive and materially misleading,” and as a result, the signatures gathered on the petition are invalid.
“Thus, because we conclude that the proposed arena’s description of effect does not satisfy NRS 295.009(1)(b), the District Court erred by refusing to invalidate the initiative, and all signatures obtained in support of the initiative with the misleading description of effect would not be valid on any amended petition with a revised description of effect. Accordingly, we reverse the District Court’s orders,” the ruling reads.
In practical terms, the decision means the measure will not appear on the November ballot, thwarting the casino giant’s years-long effort to build an arena in the heart of the Strip. The initiative would have created a special district around the arena that would have imposed a 0.9 percent increase in the sales tax, the proceeds of which would have been used to pay off the building.
Opponents of the Caesars project — affiliated with rival casino giant MGM Resorts International — argued in their court papers that the initiative’s description was misleading, because it failed to tell voters that of the four competing sites in Clark County, only the Caesars site would qualify for the special tax district. (The criteria were written very narrowly.) As a result, the Supreme Court concluded, voters were misled.
The ruling was unanimous, although Chief Justice Mike Cherry and Justice Mark Gibbons stipulated in a one-line concurring opinion that the court should have remanded the case back to District Court Judge James Todd Russell for further proceedings. It’s unlikely Russell would have come to a different conclusion, however, since state law says any change to a petition’s description of effect invalidates signatures already collected.
The ruling represents a huge loss for Caesars, which is currently engaged in building Project LINQ on land not far from where the proposed arena would have been built. The company initially approached the Clark County Commission to get the arena project under way, but commissioners rejected several proposals. The company then hired signature gatherers to qualify its initiative, and fought at the 2011 Legislature to get lawmakers to simply approve the proposal.
However, the Legislature not only rejected the Caesars arena idea, but put a competing measure on the November ballot that would have prohibited special taxing districts within a county. The company was prepared to fight to get voters to approve the measure when the court wrangling began.
Last month, the court issued a ruling that found the description of effect “deceptive and materially misleading,” but in a footnote declined to strike the initiative from the ballot. Lawyers for the arena argued that the measure would still appear on the ballot, with a revised description of effect printed in ballot summaries. But lawyers for arena foes argued the court’s ruling inevitably must mean the entire petition was invalid, and Caesars would have to start all over. (Even if a petition could be circulated by the November deadline, the soonest it would appear on a ballot would be November 2014.)
The ruling leaves three arena proposals still active: One envisioned on the Symphony Park parcel west of downtown; one connected with a retail-and-student-housing master plan at UNLV; and one on land near the M Resort in Henderson.
The case is Taxpayers for the Protection of Nevada Jobs v. Arena Initiative Committee, et. al. You can read the ruling for yourself here: Initiative-Order.pdf.