Header image alt text

Joyce Clark Unfiltered

For "the rest of the story"

It has been 17 years and 214 days since the city’s pledge to build the West Branch Library.

On July 24, 2015 at a special voting meeting the Glendale City Council unanimously passed Ordinance 2949 and the First Amendment to AMULA Final. With these actions the city and Ice Arizona agreed to dismiss all lawsuits and also settled the issue of the million dollars sitting around in a special escrow account as a result of the 2009 bankruptcy filing.

Before the Kumbaya vote Anthony LeBlanc, spokesperson for the ownership group said, “We’re not going to renegotiate…never, never, never.” Oops. The afternoon of the fateful vote in a radio interview with Roc & Manuch, LeBlanc was heard to say, “We haven’t been open with them (the city).”And, “We haven’t been good communicators.” And, “They’ve done well for the taxpayers. They’ve got a win.” When asked if Ice Arizona would consider buying the city’s arena, LeBlanc said about arena ownership, “That’s not the business we’re in.” Should we believe him in light of his long history of “erroneous” statements?

Councilmember Gary Sherwood, IceArizona’s staunch advocate, in an earlier, same day radio interview (July 24, 2015) with Roc & Manuch, said that he had publicly staked out a position that “he was not going to vote.” We can assume his action was to be a public display of disapproval for council’s treatment of his good friends, the IceArizona owners. In his traditional flip-flop fashion, he reversed himself with a little help from his friends. He revealed that the night before the vote “he had discussions with ownership” (presumably Anthony LeBlanc). His remark is interesting in and of itself for the only meeting council had prior to the vote was an executive session on July 20, 2015.  Did he share the conversations and results of that executive session with his good friend LeBlanc? Sherwood went on to say that “ownership wanted a 7-0 vote in support of the new deal.” Always willing to oblige his friends, Sherwood did a 180 and not only voted but voted in favor and made sure his pal, Councilmember Sammy Chavira did as well.

There has been considerable opining in the news media and on social media as to whether this is a good deal…for anybody. I contend that it is a good deal for Glendale if for no other reason than a $197 million dollar liability is gone…poof! That action should warm the hearts of the bond rating agencies. That figure represents the annual lease payments for the balance of the original lease management agreement.

The city gained in reducing the management fee to $6.5M from the original $15M annually. The actual language is: “10.1. Management Fee. Commencing on the Amendment Effective Date, and during the remainder of the Term, in consideration of the Arena Manager’s agreement to perform the management and other services set forth in this Agreement to pay all operating and maintenance costs associated with the Arena Facility (other than capital costs as provided herein), provided there is no breach by the Team Owner of the obligations under the Non-Relocation Agreement or a material breach by the Arena Manager of its obligations under this Agreement, the City shall pay to the Arena Manager, by wire transfer of immediately available funds to an account specified by the Arena Manager, the annual Management Fee in the amount of Six Million Five Hundred Thousand Dollars ($6, 500,000), paid in quarterly (on a three calendar month basis) installments in arrears on or before each October 1st, January 1st, April 1st and July 1st during the Term.” The city was losing an estimated $8+M a year under the original lease agreement even with the shared revenue it received. This management fee is budgeted within the city budget for Fiscal Year 2015-16.

The city also won two important concessions. It now has its own “out” clause with this agreement which ends in two years, in 2017 with recognition that “19. Termination Date means June 30, 2017.”  It now has the freedom to choose its own arena manager in a year’s time as stated, “46. Change of Manager. Notwithstanding what may otherwise be proved in this Agreement or in this Amendment, the City shall have the option to replace the Arena Manager at any time after June 30, 2016…” Everyone hopes the city will craft an RFP immediately and put it out on the street in a time frame appropriate to exercising that option.

The city achieved what can be considered as payback. IceArizona will no longer use former City Attorney Craig Tindall or former Assistant City Manager Julie Frisoni in any capacity including as a consultant. It is in #4 of the Settlement Agreement which states, “No Other City Employee Involved with Arena Agreement. The Parties represent and warrant that, as of the Effective Date, to the best of their individual and collective knowledge, information, and belief, no other former employees of the City, other than Craig Tindall or Julie Frisoni, have become consultants to or employees of IceArizona, in any capacity, since July 8, 2013. Ice Arizona represents and warrants that neither Tindall nor Frisoni has, in any way and to any extent, no matter how substantial or insubstantial, been involved in initiating, negotiating, creating, drafting, or securing the First Amendment. In reliance on these representations and warranties and those in Section 6, the City, City Council, City Manager, and City Attorney, collectively and individually, represent and warrant that they will never in the future seek to cancel or void the Arena Agreement of the First Amendment based o the involvement of Tindall or Frisoni, no matter how substantial or insubstantial, in initiating, negotiating, crating, drafting, or securing the Arena Agreement or the First Amendment on behalf of Glendale, so long as Tindall and Frisoni are not employed or retained as a consultant by IceArizona or any of its affiliates, divisions, parent entities, or subsidiaries.” The language is quite specific. That is just plain Karma for Tindall and Frisoni.

Did IceArizona get anything out of the deal? It stopped a lawsuit in which ultimately the city would have prevailed. Note that the new deal contains a lot of verbiage enjoining the city from suing IceArizona, ever, for any reason, regarding Tindall and Frisoni. The major gain was that it bought IceArizona time…time to decide its future. If the owners cannot put a decent team on the ice this year their future is bleak and they know it. It’s not a matter of distance that fans must travel to a game. That rationale has been over used. When teams win people will eagerly travel long distances to watch the winner. A team that is a contender also fills seats in suites and attracts more expensive advertising dollars…the lifeblood of any team. Each extra playoff game earns in the neighborhood of a million dollars and can spell the difference between a bottom line in the black and a bottom line in the red.

Another important issue finally resolved is that of distribution of the bankruptcy Operating Reserve Account as follows: “10. The Parties acknowledge and understand that in the Bankruptcy Settlement, subject to approval by the Court, the Bankruptcy Lawsuit (the “Bankruptcy Court”), the Operating Reserve Account shall be distributed as follows: $350,000 to the City, $10,000 to the David Reaves, Chapter 7 Trustee of the Arena Management Group, L.L.C., and $640,000 to Ice Arizona.”

In the same radio interviews, Sherwood stated that he wants “to see a new contract (with IceArizona) in 6 to 9 months, by April of 2016.”  LeBlanc stated IceArizona “wants a contract extension immediately” to bring “certainty.” Obviously it is an option both parties will need to pursue. Let us hope they can be successful in crafting a lease extension that is not build on the backs of Glendale’s taxpayers. No one can object to a lease agreement that is fair and equitable.

Be advised it doesn’t matter what the action or situation is, municipal governments do not move quickly. While an immediate contract extension is IceArizona’s goal, the caution is to not become frustrated if the action is not completed quickly. I learned this lesson the hard way. When I first joined city council I had ideas for projects in my district. I mistakenly thought they could be accomplished instantly. Not so. I became satisfied if a project could be completed within a year. It’s the very nature of government. All action is slow, overly deliberate, and far more complicated than it often needs to be.

Everyone appears to be relieved the issue is resolved for now. Let’s hope this positive action leads to further positive outcomes for both parties.

© Joyce Clark, 2015

FAIR USE NOTICE

This site contains copyrighted material the use of which is in accordance with Title 17 U.S. C., Section 107. The material on this site is distributed without profit to those who have not always been specifically authorized by the copyright owner. We are making such material available in our efforts to advance understanding of environmental, political, human rights, economic, democratic, scientific and social justice issues, etc. We believe this constitutes a ‘fair use’ of any such copyrighted material as provided for in Section 107 of the US Copyright Law and who have expressed a prior interest in receiving the included information for research and educational purposes. For more information go to http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use,’ you must obtain permission from the copyright owner.

It has been 17 years and 210 days since the city’s pledge to build the West Branch Library.

Nearly all major battles we face seem to revolve around either love or money. In the case of the Coyotes vs. Glendale it’s definitely money. Before I post a blog on the current deal between these entities it’s important to understand the effects of the biggest driver — money.

Westgate and its sales tax revenue is an important component. It cannot be denied that the majority driver of retail sales tax revenue in Westgate comes from Tanger Outlets. Before Tanger’s opening in November of 2012 retail sales tax revenue was under a million dollars a year. Tanger, when it opened, was projected to earn $2M in sales tax revenue and in fact, from the start, has generated closer to the $2.5M mark.

As you can see from the chart below in calendar years 2013 and 2014 retail sales tax revenue was over $3.5M and almost all of it is attributable to Tanger. In October of 2014 Tanger expanded and the city can now expect an estimated $4.5M in retail sales tax revenue in 2015. Restaurant/Bar sales tax revenue has also increased over time and can be related to football games, hockey games and concerts held at the University of Phoenix Stadium and the Gila River Arena. This component is also attributable to the opening of new restaurants in Westgate. This sales tax revenue has grown as well and is estimated to earn some $3M. “Other” sales tax revenue is composed of bed tax, AZSTA stadium city sales tax, licenses & permits, etc. It is estimated to earn about $5M in 2015.

In 2015 estimated sales tax revenue from Westgate looks like this: Retail — $4 to $4.5M; Restaurant/Bar — $3 to $3.5M; and “Other” — $4.5 to $5M.

Westgate sales tax

The argument often used by Coyotes’ supporters is that the spillover effect from 42 nights of hockey games is essential to Westgate’s restaurants and bars survival and to the city. How much of that spillover is from 70,000 fans attending each of 10 football games? Admittedly it is substantial and could account for anywhere from 1/3 to ½ of the sales tax revenue generated from restaurants and bars annually.

The point is that Westgate has grown despite all of the drama and turmoil of the Coyotes and is strong enough to survive with or without them. If one looks at all of the factors that determine annual sales tax generation at Westgate the Coyotes (from hotel stays and restaurants/bars) are estimated at driving about $2M a year out of a total estimated annual sales tax revenue of a low of $11.5M to a high of $13M.

As long as we are on the subject of money there is another factor to consider. Many Coyotes fans are hoping that the Coyotes will move to downtown Phoenix or a new arena at Talking Stick. Dan Bickley in a recent July 26, 2015 Arizona Republic story entitled Coyotes not out of the woods – or Glendale – just yet said, Sarver says his Suns pay $23 million a year just to play at US Airways Center: $12 million in debt service, $8 million in arena management costs and $3 million in rent. A new arena capable of housing a NBA team and a NHL franchise starts at $500 million, and that’s being conservative.” Kudos to Robert Sarver for publicly offering some expense figures (no revenue figures, mind you). That’s more than anyone has seen from the Coyotes. Any public figures associated with the Coyotes have been minimized or denied by Anthony LeBlanc, an owner and visible spokesperson for the ownership group.

The question for the Coyotes becomes can they afford to move anywhere? Sarver is not in the charity business and I suspect that the owners of Talking Stick are not either. All bets are off if the Coyotes move out of Arizona. Is there an entity out there willing to pay the Coyotes to play in a newly constructed arena? Who knows? The Coyotes will have to pay to play anywhere else in Arizona and as long as they continue to suffer losses of an undetermined amount their options are very limited. No one is offering any love to the Coyotes these days and their entire future is being driven by only one thing – money.

© Joyce Clark, 2015

FAIR  USE NOTICE

This site contains copyrighted material the use of which is in accordance with Title 17 U.S. C., Section 107. The material on this site is distributed without profit to those who have not always been specifically authorized by the copyright owner. We are making such material available in our efforts to advance understanding of environmental, political, human rights, economic, democratic, scientific and social justice issues, etc. We believe this constitutes a ‘fair use’ of any such copyrighted material as provided for in Section 107 of the US Copyright Law and who have expressed a prior interest in receiving the included information for research and educational purposes. For more information go to http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use,’ you must obtain permission from the copyright owner.

It has been 17 years and 208 days since the city’s pledge to build the West Branch Library.

Please note: It seems that when one takes a short vacation all hell breaks loose. Glendale and IceArizona have resolved their differences for now. I will be posting a future blog on that event. In the meantime, I noted that the Glendale Star reported that it had attempted to contact me for a comment for their story. Thank goodness for digital phones. Having checked all calls for the past several weeks I can confirm that I received no phone call from the Glendale Star.

On July 22, 2015 the Glendale Police Department issued a press release confirming that Commander Andre Anderson has been hired as Ferguson, Missouri’s Interim Police Chief. In my blog entitled Beasley may have company in Ferguson dated June 25, 2015 I announced that it was possible that he would take the job as well as issues that both Beasley (hired as Interim City Manager) and Anderson could face.

Several nagging questions remain. I had heard that Anderson was reluctant to take the job because of the pay disparity between Glendale and Ferguson. Ferguson is a much smaller community, about 1/10 the size of Glendale. I had also heard that that Glendale might make up the disparity in pay between Anderson’s current salary and what he was offered in Ferguson. Would Glendale do such a thing? The rational answer is ‘no’ but we have certainly seen Glendale do other irrational acts. It doesn’t seem that it would be legal. So…the question for Glendale officials is this…is Glendale subsidizing Anderson’s pay while he works for Ferguson? It is a question that deserves a public answer from Glendale because Ferguson isn’t telling.

Anderson is on a six month loan from Glendale. He will be using up all of his vacation time and when that runs out, he will be on unpaid leave from Glendale. However, that explanation doesn’t answer the question of whether Glendale is subsidizing Anderson’s pay.

Another question…what is the city’s reasoning in allowing Anderson to serve as a paid administrator in Ferguson? Was it a favor to Glendale’s former City Manager Ed Beasley? It’s eerily similar to Beasley’s allowing Alma Carmicle, Glendale’s former HR Director, to telecommute from Mississippi.

The Glendale Police Department has, in a fashion, loaned personnel to various state task forces. They remain on the Glendale payroll and their salaries are not subsidized. Although it may have happened I do not recollect in Glendale’s history a Commander taking leave to serve as a Police Chief or in the administration of another municipality. More answers should be provided by the city than has been offered to date. Come on Glendale, come clean.

© Joyce Clark, 2015

FAIR USE NOTICE

This site contains copyrighted material the use of which is in accordance with Title 17 U.S. C., Section 107. The material on this site is distributed without profit to those who have not always been specifically authorized by the copyright owner. We are making such material available in our efforts to advance understanding of environmental, political, human rights, economic, democratic, scientific and social justice issues, etc. We believe this constitutes a ‘fair use’ of any such copyrighted material as provided for in Section 107 of the US Copyright Law and who have expressed a prior interest in receiving the included information for research and educational purposes. For more information go to http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use,’ you must obtain permission from the copyright owner.

It has been 17 years and 201 days since the city’s pledge to build the West Branch Library.

A July 8, 2015 article in the Glendale Star by Darrell Jackson highlights “coincidences” between Councilmember Chavira’s actions and decisions as an elected official and campaign contributions he recently received. Here is the link:  http://www.glendalestar.com/news/article_85b74584-25a1-11e5-95e3-6f2610f801ba.html .

Before reviewing his recent bout of troubling “coincidences” it’s time for another history lesson. I admit to bias. In 2012 Chavira defeated me in the election for the Yucca district seat. He had a lot of support from the Maricopa County Democratic Party #1049 which donated $10,000 to his campaign. He had former Glendale Councilmember Norma Alvarez as well as that of Danny Valenzuela, a Glendale firefighter currently serving on the Phoenix City Council, to thank for the Dems support. Although I am sure Alvarez regrets her support of Chavira when he broke from her and voted against her positions on issues. As a Phoenix firefighter he received thousands of dollars from firefighter union chapters as well benefitting from their independent expenditures on mailers, flyers, signs and manpower. He also received tremendous support from the Hispanic community and used “dreamers” almost exclusively as his foot soldiers. He outspent me in the order of $5 to $1.

During that election cycle some elements of his questionable past actions became public. Just prior to the 2012 election Sammy and Danny were members of the National Association of Hispanic Firefighters (NAHF). Sammy was removed as a Vice President and both men resigned because they allegedly bore responsibility for loss of funds from an NAHF fund raising event. The event may have made money but not for the NAHF. All it received were the bills.

That specific NAHF event was produced by the Phoenix Monarch Group (PMG): Art Jimenez and Tony Herrera. Herrera, a firefighter, has his own business, One Consulting, and also had a  business relationship with Chavira’s wife (and Chavira). Sammy and Danny advocated for hiring them to run the event. Apparently a lot of “funny stuff” happened with scenes (ala the Mafia) of Sammy apparently riding around in a golf cart with Herrera collecting money from the vendors…money never seen again or accounted for to the NAHF.

The Phoenix Monarch Group’s history has a lot of its own question marks. Prior to IceArizona’s successful acquisition of the Arizona Coyotes PMG appears to have had former Mayor Scruggs and former Councilmember Alvarez as advocates as they attempted to secure a contract to manage Glendale’s arena. All of the relationships mentioned are entangled like a giant ball of snakes. It seems as if Sammy’s previous ethical “coincidences” turned out to be precursors’ of his current ethical “coincidences.”

Sammy received a contribution of $500 on February 2, 2015 from Nicholas Wood.  Wood is also one of IceArizona’s stable of legal counsels. On June 10, 2015 the city council voted 5-2 to cancel the IceArizona management contract for the arena. Sammy just happened to be one of two votes against cancellation. Hmmm…

Then on March 23, 2015 Michael Curley (recently deceased) who represented the Bidwills on many of their projects in Glendale, including Sportsmen’s Park East and West, donated $500 to Chavira. A day later, on March 24, 2015, the city council workshop included a discussion of the infamous, Taj Mahal Westgate parking garage. Chavira seemed to have no problem with sticking the cost of this over priced garage to Glendale taxpayers. Hmmm…

Here’s one to watch. Jacob Long, son of deceased John F. Long, is nearly ready to make application for rezoning of a large parcel of land south of the Grand Canal to Camelback Road, 83rd Avenue to 91st Avenue. Unless, there are some changes to the zoning plan by Long, neighbors will not be happy and can be expected to protest this one. On February 23, 2015, Long made an yet another contribution to Chavira of $500 bringing his cumulative total to date to $930. Hmmm…

Yet another example of a Chavira’s “coincidence” is recent contributions from firefighter unions. At the April 21, 2015 city council workshop Chavira read a prepared stump speech in support of the Glendale firefighter union request for more funding. A few days later, on April 23, 2015, Phoenix Fire Fighters Local 493 (Fire PAC) gave Sammy $1,000 followed by April 27, 2015, donations of $1,000 from the Peoria chapter and $1,000 from the Tempe chapter. You would think he bears a conflict of interest. Hmmm…

Does it seem that Sammy is ethically challenged? Does it seem to you that his relationships seem questionable? Does it seem that if you have enough money to play he will advocate for you? Does it seem that Sammy is not making decisions in the best interest of Glendale but rather in the best interest of his campaign contributors…Becker billboards…a flip-flop from his campaign platform of denial to approval of the IceArizona contract…no vote on IceArizona contract cancellation…advocacy for more money for firefighters with the use of scare tactics…making the temporary sales tax permanent? Hmmm…

© Joyce Clark, 2015

FAIR USE NOTICE

This site contains copyrighted material the use of which is in accordance with Title 17 U.S. C., Section 107. The material on this site is distributed without profit to those who have not always been specifically authorized by the copyright owner. We are making such material available in our efforts to advance understanding of environmental, political, human rights, economic, democratic, scientific and social justice issues, etc. We believe this constitutes a ‘fair use’ of any such copyrighted material as provided for in Section 107 of the US Copyright Law and who have expressed a prior interest in receiving the included information for research and educational purposes. For more information go to http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use,’ you must obtain permission from the copyright owner.

%d bloggers like this: