Well, at least the good people of Glendale will no longer have to live with Phoenix getting all the credit for having their hockey team. Now, everyone in Arizona gets to share the Coyotes. But the taxpayers of Glendale, they’re the only ones who get to feel the pain.
In short, this conglomerate known as Renaissance Sports and Entertainment and the NHL got away with a heist and didn’t even have to wear a mask or carry a gun. Now, with Glendale council voting 4-3 to enter a 15-year lease agreement, the Arizona Coyotes get all the benefits of being propped up by a city that has ignored hockey and that city gets to assume almost all the risk. Say what you will about NHL commissioner Gary Bettman, but the man makes his best deals when people think he’s backed into a corner and has nowhere to turn.
And here’s the kicker. This deal doesn’t even guarantee the future of the hockey team in the desert for more than five years. That should be just enough time for Seattle and suburban Toronto to get their NHL-caliber arenas up and running, no?
Because when you wade through all the surcharges (that apparently replace other ones, which makes one wonder where any new money is being generated), parking revenues, naming rights money, the team’s make-whole provision if it leaves and other projected riches, one thing is clear: The city of Glendale is looking at losing a minimum of $6 million a year on this team, probably more, and still faces the prospect of ultimately losing the Coyotes.
Even though RSE signed a 15-year lease, it allows RSE to move the team after five years if it has lost $50 million in that time. It likely will. The only proviso is that RSE will have to pay the city’s losses beyond its $6 million guarantee to “make whole” – where have we heard that term before? – Glendale if the team moves.
This is all very convoluted stuff, but Glendale has basically agreed to surrender a minimum of $6 million and a maximum of $15 million to RSE each year of this agreement. And while the team has an out-clause to leave, the city does not. Which means even if the team is losing boatloads of money, but still opts to stay in Glendale and receive the city’s handouts for another 10 years, it can do exactly that and there’s nothing the city of Glendale can do about it but keep stroking cheques.
As Glendale mayor Jerry Weiers, who voted against the deal, said, it’s like stepping in front of a truck and simply trusting someone will pull you back. If that’s the case, Glendale residents and their councilors would be well advised to brace themselves for getting hit by a truck.
Much was made of the involvement of Global Spectrum, which reportedly paid about $45 million to partner with RSE to run the Jobing.com Arena. It apparently was the dealmaker. In fact, one of the Glendale councilors, Manny Martinez, said that until he learned of the Global Spectrum involvement, he was prepared to vote against the motion. It was essentially the involvement of Global Spectrum that turned a 4-3 vote against to a 4-3 vote in favor.
But here’s the thing. Global Spectrum is essentially owned by Philadelphia Flyers owner Ed Snider. Global Spectrum operates 113 arenas and only one of them, the Wells Fargo Center in Philadelphia, is home to an NHL team. Did Snider and Global Spectrum get involved in a money-losing arena as a favor to Bettman? Probably not.
But it is interesting to note that last September, Global Spectrum signed on to manage and operate the GTA Centre in Markham, Ont., once it opens. The GTA Centre is a 20,000-seat arena that is in its infancy and would provide a ready-made building if the NHL ever decided to relocate or expand to the largest and most under-serviced hockey market in the world. Is it a stretch to suggest that if the Coyotes fail, Global Spectrum and its owner might want to see them move to an NHL-sized building that it already manages?
The vote ended a wild night in Glendale, one where passionate residents of the area talked about how much money they spend at the nearby Westgate shopping complex because they go to Coyotes games. But if the Coyotes weren’t around, there’s a good chance they’d be spending that money at other local businesses. That didn’t stop many in attendance from fear mongering at the thought of losing the Coyotes. One supporter said if the Coyotes left town, the Canadians would leave and never come back, as though snowbirds go to Arizona in the winter because it has a hockey team. Please.
But that’s the shell game that sports entrepreneurs and those who support them like to play when their hand is out for public money. And the people of Glendale have the right to prop up a hockey team if they want and endure the tax raises or cuts in services that could very well come with throwing money at the Coyotes. And the members of city council who voted for the agreement were willing to stake their political futures on a team that has bled money pretty much since the day it landed in the desert.
But let the record show that vice mayor Yvonne Knaack and councilmembers Manny Martinez, Gary Sherwood and Sammy Chavira voted for the lease agreement. Mayor Weiers and councilmembers Ian Hugh and Norma Alvarez voted against. When the Arizona Coyotes pull up stakes and move to either Seattle or Toronto in five years, the people of Glendale will certainly want to remember that.
Ken Campbell is the senior writer for The Hockey News and a regular contributor to THN.com with his column. To read more from Ken and THN's other stable of experts, subscribe to The Hockey News magazine. Follow Ken on Twitter at @THNKenCampbell.