Monorail woes continue

How bad are the prospects for the Las Vegas Monorail? Ridership increased by 13 percent last year, yet the Strip tram is still nowhere close to covering operational costs.

In fact, the monorail missed a scheduled bond payment earlier this month and had to tap reserves for more than $2 million to cover the debt.

A little more than 21,000 passengers ride the monorail each day, paying an average fare of $3.57 apiece. But to balance the books, the monorail needs to increase traffic by more than 60 percent, to about 34,500 daily riders.

Businesses that need to increase sales by 60 percent just to break even don’t stay in business very long. If the privately financed, $650 million line were an animal, a compassionate veterinarian would have no choice but to put this poor, sick creature down.

Undeterred, officials with the Las Vegas Monorail Co. are hunting for financing to build track that connects the four-mile route to McCarran International Airport. With global markets in turmoil and financial institutions clamping down on credit deemed to have even the slightest risk of default, the chances of getting the half-billion dollar extension built hinge on the existing line making a miraculous turnaround.

Taxpayers were assured that they’d never be on the hook for the bonds issued in 2000 to build the monorail, even though the Nevada Department of Business and Industry served as a channel for the bond sale and received notice that the company had missed its bond payment. A contingency fund is supposed to exist to cover demolition costs if the line goes bankrupt and has to shut down.

But the fawning by progressives and mass-transit groupies that greeted the monorail’s 2004 launch — and the inflated ridership estimates that ensured its creation — foreshadow likely political opposition to any effort to dismantle the project. The monorail “will become increasingly critical to mobility in our busy resort corridor,” company spokeswoman Ingrid Reisman assures us.

Someone is going to propose a public bailout of the monorail, rest assured. The only question is when.