I thought the end was near. I should have known better. With the most recent developments in the Phoenix Coyotes ownership saga, the likelihood of the franchise remaining in Phoenix has perhaps never looked so grim.
The deal was almost done. Matthew Hulsizer had agreed to buy the team from the NHL for $170 million, and the city of Glendale agreed to pay for a $100 million chunk of that. Furthermore, Glendale had agreed to provide Hulsizer with $97 million over the next five years to manage Jobing.com Arena, while Hulsizer in return agreed to keep the team in Glendale until 2041, paying millions to the city in arena rent and fees along the way until he eventually owned the arena.
Enter the Goldwater Institute.
To raise the money for their $100 million contribution, Glendale’s plan was to sell municipal bonds and to pay them off by charging for parking during all events at Jobing.com Arena. However, the Goldwater Institute has effectively impeded that plan. Specifically, the Goldwater Institute sent out a letter to significant bond agencies across the United States warning them that Glendale’s bond arrangement may potentially violate the Gift Clause of the Arizona Constitution.
As the Goldwater Institute explains, “the Gift Clause of the Arizona Constitution prohibits gifts by subsidy, loan, or otherwise to private individuals or corporation.” However, as interpreted by the Arizona Supreme Court in Turken v. Gordon (223 Ariz. 342), a city may provide financial support to a private entity, but only if it receives a tangible benefit of roughly a proportionate value. Thus, the Goldwater Institute is concerned that the parking revenues will not provide Glendale with a roughly proportionate value. Particularly, they’re concerned that Glendale already owns the parking rights, and therefore the city is attempting to sell rights to itself, a “clear violation of the Gift Clause.”
The whole ordeal has reached a new level of messiness.
The Goldwater Institute wants documentation from Glendale, and they have threatened to ultimately sue if needed to block the deal. Glendale has considered suing the Goldwater Institute for illegal interference in the city’s business affairs. The NHL wants to meet with the Goldwater Institute, but the Goldwater Institute will only do so if the meeting is open to journalists.
Meanwhile, Coyotes’ fans are left once again without a say. While they are undoubtedly ecstatic about the team’s playoff chances this year, unfortunately, that familiar feeling of uncertainty will quietly continue to grow in the back of their minds. As Matthew Sekeres of the Globe and Mail notes, “it’s a powerless feeling, and the rage builds from within.”
One thing is for certain, if the Coyotes do end up leaving town because of this latest snag, it will leave a community of diehard hockey fans left howling at the moon. You may doubt that community’s existence now, but you wont come April.