The Phoenix Coyotes will stay put for at least one more season.
According to a report by TSN.ca, the NHL and the city of Glendale have hashed out the terms of a deal that will see the Phoenix suburb cover up to $25-million (all currency U.S.) of the team's operating losses next season if the league cannot find a buyer for the financially crippled franchise. The league was forced to buy the Coyotes in a U.S. Bankruptcy Court auction last October for $140-million.
Last week, Glendale council gave city manager Ed Beasley the authority to work out an agreement with the NHL, which has poured more than $170-million into the team, with a limit of $25-million.
The next step for the NHL is to work out a deal with one of the two prospective buyers for the Coyotes. Jerry Reinsdorf, the owner of the Chicago White Sox and Chicago Bulls, was the preferred buyer for Glendale city council, although it tried to re-open negotiations recently with the Ice Edge group of investors after talks about an arena lease with Reinsdorf hit a snag.
Talks with Ice Edge also stalled and it is not clear where everyone stands now. TSN reported that Ice Edge is reluctant to continue negotiating a lease unless the city agrees to give them exclusive rights to a lease.
Glendale spokeswoman Julie Frisoni said she could not confirm there is a deal between the city and the NHL. "I don't have any knowledge of that at this point," she said.
Bill Daly, the deputy commissioner of the NHL, did not respond to a request for comment.
The city will also have to contend with legal action from the Goldwater Institute, a conservative watchdog group. Excessive public subsidies of private businesses are illegal under Arizona law and Goldwater lawyers have said it is also illegal for a community to give a city manager the power to close a binding agreement with another party without public debate and a vote of approval from city council. However, a Goldwater lawyer said last week the group will not go to court until it sees a written copy of the deal between the NHL and the city.