It has been 17 years and 336 days since the city’s pledge to build the West Branch Library.
It seems that Thanksgiving got in the way of much blog writing recently. I hope your Thanksgiving Day with family and friends was enjoyable. I hope you ate too much, laughed too much and watched too much football.
It was announced that the Coyotes hired Mitchell Ziets, CEO of Tipping Point Sports, LLC, to assist in an exploration of options for the team including a move to another venue from the Gila River Arena in Glendale. Let’s explore the reality of this option.
In a November 2, 2015 story by Craig Morgan several possible venues are offered for consideration by the Coyotes. Here is the link: http://arizonasports.com/story/436156/coyotes-in-discussions-with-at-least-three-separate-groups-for-new-valley-arena/ .
In his story Morgan offers this comment from Anthony LeBlanc, “At some point you have to make a decision that you can’t continue to talk to a wall, Coyotes co-owner, president and CEO Anthony LeBlanc said. You have to accept reality and look at what your alternatives are. That’s where we are right now.” From the time LeBlanc’s group, IceArizona, commenced its deal with Glendale for the use of its arena the Coyotes simply refused to talk to and to share information with Glendale. They were decidedly off the reservation. It has only been since the new, two-year deal was inked that IceArizona has decided to play nice with Glendale.
IceArizona may very well leave Gila River Arena in two years but options to play elsewhere in the Valley are more limited than current speculation would lead one to believe. LeBlanc admits to “conversations” with Phoenix about the possibility of a shared arena with the Phoenix Suns. Out of curiosity I checked the 2015-2016 playing schedules for both teams. Here are some comparisons:
Phoenix Suns Arizona Coyotes
Season 10/28/2015-4/13/2016 10/9/2015-4/13/2016
Number of total games 82 82
Number of home games 40 41
Out of the 40+ plus home games each team plays at its current venue, if they currently played at the same shared venue, 12 playing dates would conflict. That is ¼ or 25% of their home games. To be fair, we know that can be remedied by the leagues with a gnashing of teeth and the pulling of hair. It has worked before when the Coyotes and Suns shared a venue. One would think the Coyotes fans have warm memories of their experiences in sharing a venue with the Suns and are eagerly looking forward to do so again.
In a recent December 2, 2015 Paul Giblin story in the Arizona Republic, he cites issues that Phoenix would have to consider. Here is the link: http://www.azcentral.com/story/news/local/glendale/2015/12/02/arizona-coyotes-arizona-cardinals-wont-bid-manage-glendale-gila-river-arena/76564718/ .
- How much would a new arena cost? The Milwaukee Bucks’ planned new arena is pegged at $500 million.
- How much would be privately funded? How much publicly funded? Would the public-funding source be municipal, state or some combination?
- Can voters be sold on the idea of picking up any portion of the bill?
- Where specifically would an arena be built?
- When would it open?
- Can the Suns and Coyotes work out an agreement to split revenues?
Let’s look at other possible venues. Tempe and/or Scottsdale are possible candidates. Would the voters of Tempe and/or Scottsdale approve the construction of a $180 million dollar building (cost of Gila River Arena construction in 2005) and agree to subsidize, year after year, a team that is not profitable? Remember those who do not read history are doomed to repeat it. I would think many voters would be very aware of Glendale’s history and that could certainly cause them to think twice about such a proposal.
Arizona State University has been mentioned as well. ASU receives substantial funding from the Arizona State Legislature. It is conceivable that a majority of legislators may balk at the idea of state taxpayer money being used to subsidize a for-profit company. If ASU can fund and subsidize such a project with new, private dollars and not divert private dollars already committed for existent programs then it is possible. But wait, didn’t ASU Hockey just commit to playing its games at Gila River Arena? If that is the case, wouldn’t ASU have to build a new venue?
The last location on the menu of possibles is Talking Stick. That is certainly do-able. An Indian reservation is not subject to federal, state, county or local laws. The tribe is free to build what it wants to build on reservation land. One has to wonder if this tribe would be willing to invest in the construction of another major venue as well as subsidizing the team in perpetuity.
There was an interesting article published on October 20,2015 by the Flordia’s Sun Sentinel regarding the NHL Florida Panthers and a Broward County proposed deal. Here is the link: http://www.sun-sentinel.com/local/broward/fl-panthers-subsidy-debate-20151020-story.html .
In some ways their deal is like comparing apples and oranges for Broward County has a population of 1.87 million people and includes 24 cities. That in itself is much different from Glendale’s population of approximately 240,000 and the fact that it is one city having to deal with a hockey arena. Some elements of their proposed deal are eerily similar to the Glendale/Coyotes deal. As of this date their deal has yet to be approved but here are some of the deal points which would expire in 2028:
- The Panthers would continue making $5.3 million annual debt payments toward the county’s $15.3 million obligation.
- Receive $86 million from the county, or $6.6 million a year on average, but in a schedule of front-loaded payments that starts at $12 million a year. Of the total, $39 million must be used for capital expenses at the arena, $45.5 million for operating expenses like paying the electric bill or property insurance, and $1.5 million to lure a “high impact event.”
- Provide an irrevocable letter of credit to protect the county’s financial investment if the team defaults, files bankruptcy or relocates.
- Grant the county development rights on land surrounding the arena, where a mixed-use entertainment complex could be considered.
- Share proceeds with the county if the NHL expands between 2015 and 2021 and gives teams expansion proceeds. After the Panthers’ losses are covered, the county would get the remainder of the one-time expansion payment.
- Give the county 10 percent of profits if the team, made more valuable by this new deal, were sold.
- Give the county authority to approve where the money for capital projects is spent, and authority to replace the Panthers’ Arena Operating Company with another arena manager if needed.
- Allow the Panthers to get out of the contract in eight years if it’s not working out. They’d have to give a year’s notice, show losses of $100 million over seven years, and pay a termination amount. For example, if the Panthers leave in year 8, they’d pay back the full $72 million the county would have given them by then.
No matter where the Coyotes end up in the Valley, whether they remain in Glendale or move to another location, their quest to be subsidized by a governmental entity is surely a public policy question deserving of much public discussion. The people of any city have a right to weigh in on the question of their tax dollars being used to subsidize a private, for-profit company.
© 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 ‘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 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 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.