Are they worth it?
A Tuesday night vote by the city council that controls the Phoenix Coyotes' home rink will determine whether the beleaguered team is worth nearly $200-million (all currency U.S.) taxpayer dollars.
Glendale City Council is scheduled to vote on a lease proposal submitted by Matthew Hulsizer, a Chicago financier working to purchase the cash-strapped NHL team by month's end. The proposal mandates that the city take on up to $197-million in obligations over the next six years, including a $100-million payment to Hulsizer's group to purchase arena parking rights from the team. The remaining $97-million would be meted out over six years as a fee to the Hulsizer group for managing the Jobing.com Arena.
All of that adds up to a healthy subsidy for Hulsizer, who is expected to pay the NHL around $170-million for rights to the team. The 40-year-old, a former NCAA Division III hockey player, won the unanimous blessing of the NHL board of governors' executive committee last week. Hulsizer's purchase would end the league's long hunt for a new team owner after the league purchased the Coyotes in U.S. Bankruptcy Court last year. At the time, the league stated its intention of selling the team to someone who would keep it in Glendale, if such a buyer could be found. Throughout negotiations, the league has stipulated that a new lease agreement with Glendale would be a requirement for any new owner of the team.
In a statement released Friday after Hulsizer's proposal was made public, Glendale's council lamented the "devastating, negative economic impact" that losing the Coyotes would have on the city.
However, it's unclear whether the steep price tag that Hulsizer's proposal comes with will fly.
The council statement bills the parking lot management of 5,500 spaces surrounding the arena as "a new revenue stream" that could eventually pay for the parking purchase rights.
But accepting the deal would hike Glendale's debt on sports-related venues to more than $1-billion, including interest.
It would also likely quash the standing conditional offer in place from True North Sports and Entertainment Ltd., which had plans to move the team to Winnipeg.