Jim Neveau, Howlin’ Hockey
At a long and protracted City Council that in many ways mirrored the lengthy struggle that this hockey team has undergone to try to remain in the desert, the Glendale City Council voted by a 5-2 margin to approve a deal putting $25 million in an escrow account to keep the Phoenix Coyotes at Jobing.com Arena for at least one more year. The deal is identical to one struck before last season, with the NHL forcing the city to take on the burden of financial losses that the team suffers while looking for a new owner.
The council vote also bookends what has been an interesting day for the team’s ownership situation. The Phoenix Business Journal, which has been on top with all of the developments in the ownership saga, reported that the NHL has been courting Chicago Bulls and White Sox owner Jerry Reinsdorf to buy the financially-strapped team. He has been in the mix since Jerry Moyes took the team into bankruptcy, and he could be looked to again if Chicago businessman Matthew Hulsizer is unable to close a deal to purchase the Coyotes.
Another potential member of an ownership group for the franchise also pulled out on Tuesday, with Ice Edge Holdings (a group who had advocated having the team play a limited number of games in Saskatoon to help raise revenue) backing out of a potential minority stake in the team. In a statement, they wished the team luck going forward, and also said that Hulsizer would be “a terrific owner.”
The decision to back out by Ice Edge seems to focus on the opposition issued by the Goldwater Institute, a conservative watchdog group largely blamed for blocking the sale with the threat of litigation if a deal agreed to by Hulsizer and the city of Glendale had come to pass. In that deal, the city would issue $100 million worth of municipal bonds to help finance the sale of the team, and would recoup the revenue by charging for parking around the arena. This plan hit a snag both when Goldwater said that it would violate the “gift clause” of the Arizona state constitution, and also when the organization revealed an agreement giving the rights to the parking lots around Jobing.com Arena to the city when former owner Jerry Moyes put the team into bankruptcy.
With all of that being said, the question now becomes whether or not the team can get an ownership deal done to stay in the Valley long-term, but if things stay status quo, that could be up in the air. Hulsizer has indicated at multiple points that he has already made his best offer to the city, and with the deal facing an uphill climb in court if approved as is, it could be argued that Hulsizer may end up out of the mix. In fact, Bill Daly, deputy commissioner of the NHL and leading proponent of the team staying in Glendale, called the current deal “problematic” and seemed to express some hesitancy about whether or not Hulsizer is the guy who will seal the deal.
Needless to say, things are still looking uphill even with the deal to keep the Coyotes in Arizona for another year in place. The league still needs to find an owner willing to pony up its asking price for the franchise, and that is increasingly difficult with each year of financial losses that are continuing to mount. They may still find that person with deep pockets willing to take the risk, but time is running short for them. It will be interesting to see how this situation resolves itself over the course of the upcoming year, but one thing is for certain tonight: there will be NHL hockey at Jobing.com Arena this season, and the fans of the city need to come out to support their team, or else they could be packing their bags again at this time next year.