LAS VEGAS | PUBLIC TRANSIT
Las Vegas Monorail hits a financial barrier
LAS VEGAS — Financial default "appears probable" for the Las Vegas Monorail, according to a credit-rating firm that dropped the monorail's bond rating further into "junk" status, but its operations company says this won't affect service.
The analysis, released Tuesday by Fitch Ratings in New York, predicted that the rail line, which runs along the Las Vegas Strip, wouldn't be able to pay its debts by 2010. Fitch blamed "continued declines in monthly revenue" in the first half of this year, caused by ridership losses and fare discounts.
The company that runs the 3-year-old monorail denied that either the line or a proposed $500-million extension to McCarran International Airport was in jeopardy.
"The new Fitch rating will have no effect on the day-to-day operation of the Las Vegas Monorail or its expansion plans," Ingrid Reisman, vice president of the Las Vegas Monorail Co., said in a statement.
"The fact that the privately funded Las Vegas Monorail has transported more than 24 million visitors along the resort corridor ... indicates that it is and will continue to be a part of the long-term transportation solution," she said.
In downgrading the bonds of the transit system to "CC" status from "CCC," Fitch cited competition for riders who take buses and taxis along the Strip. Last year, a Fitch analyst said the monorail's bond rating would make it difficult to gain financing for the McCarran extension.
The 3.9-mile line began running in July 2004 on an elevated Z-shaped track east of the Strip, linking several resort hotels and the Las Vegas Convention Center.
When it began service, the monorail projected more than 50,000 riders a day. In June the daily average was 23,790 riders.
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