The lack of public subsidy is unusual for a publicinfrastructure project and, in the case of the 3.9-mile monorailroute that has been servicing the Las Vegas Strip since 2004, lessthan successful. The monorail's rider- and revenue-per-milestatistics are the highest in the nation but the revenue—while 30%higher than operational costs—hasn't been enough to cover its debtservice obligations.

Three tranches of debt were used to pay for 100% of the $650million project. Two-thirds of that total came in the form of bondsheld by Nevada's Department of Business and Industry, which has itinsured by Ambac Financial Group, a major financial guarantor.Earlier this year, Moody's said the bonds could default in as soonas two years and concurrently cut the monorail company's credit tofrom "B3" to "Caa3"—aka "junk bond territory"—but kept theinsurer's "AAA" credit intact even as it and other bond insurersface trouble form the subprime mortgage sector.

Las Vegas Monorail Co. believes the solution to its problems isto extend a line to the busiest place in town by 2012. That havingbeen said, it isn't yet ready to discuss how its overall debtpicture would look afterward and how much ridership would need toincrease to cover it.