The Phoenix Coyotes’ long wait for an owner might finally be over.
Glendale’s City Council approved a 20-year lease agreement for Jobing.com Arena on Friday, clearing the last major hurdle in the sale of the Coyotes to a group led by former San Jose Sharks CEO Greg Jamison.
The council ratified the 20-year, nearly $325 million agreement by a 4-2 vote after a sometimes-contentious six-hour meeting attended by Jamison, NHL Commissioner Gary Bettman and Deputy Commissioner Bill Daly.
”We’ve been doing this a long time,” Bettman said. ”We believe this team, the Coyotes, can be here with a new ownership in place and should be here.”
Approval of the lease agreement should clear the way for Jamison’s group to buy the team, ending a three-year odyssey that’s included bankruptcy, failed deals with other prospective owners and the team playing under financial restraints while being operated by the league.
Jamison still needs to work out a final deal with the NHL and gain approval from the league’s board of governors, but this was considered the last major obstacle to finally bringing an owner in and keeping the team from leaving the Valley of the Sun.
”The Coyotes-Glendale situation has had an interesting history; sometimes up, sometimes down, sometimes sideways,” Jamison said. ”But what right now we’re talking about the future and I believe in the city of Glendale.”
The city put up $25 million each of the past two years to cover losses by the NHL and keep the team in town. Glendale recently had a round of layoffs, along with tax hikes and service cuts to cover a $35 million gap in the upcoming budget, so a publicly-financed deal to keep the Coyotes – one that includes an average of $15 million in arena operating costs – wasn’t popular with everyone.
According to a study commissioned by Glendale, the city would pay Jamison $203 million and bring in $45 million in revenue, leaving a huge gap. The study also calculated what it would cost the city should the Coyotes leave, estimating about $177 million in operating costs for Jobing without an anchor tenant.
Despite a projected benefit of $17 million for the city, some residents and at least two city council members were concerned about the current financial situation, the tax burden and, in some cases, the validity of the figures in the study.
”The reason I’m not in support of this is strictly because of city finances at this point,” said Mayor Elaine Scruggs, who added that she believed the Coyotes should remain in Glendale, only under different circumstances.
The Coyotes thought they had a deal with Chicago businessman Matthew Hulsizer last year, only to have it thwarted by conservative watchdog group Goldwater Institute, which warned potential bond buyers to stay away from the Glendale offering because of a looming lawsuit.
Goldwater tried to stop this deal as well, filing a temporary restraining Friday morning to prevent the vote that contended the city violated the Arizona open meetings law by failing to make public all documents related to the lease.
Maricopa County Superior Court Judge Katherine Cooper denied the restraining order, saying the court lacked the jurisdiction to do so, but added that there were violations of a 2009 court order requiring Glendale to provide all documents in negotiations between the Coyotes and a prospective buyer by provided to Goldwater in a timely manner.
”She issued a strong warning to the City of Glendale about the implications of moving forward today, affirming the Goldwater Institute’s contention that the city has committed `clear violations’ both of court orders and open meeting laws,” Goldwater Institute President Darcy Olsen said in a statement. ”She emphasized the court would be receptive to considering holding the city in contempt if the council moves forward with the vote, stating that sanctions would be in order. We hope the council will heed the judge’s warning, comply with the law, and give the public sufficient time to review the council’s proposed action.”
The fight might not quite be over, but it’s certainly a big step for the Coyotes, who have played under a cloud of uncertainty since Jerry Moyes took the team into bankruptcy three years ago.
Despite being run by the league, Phoenix made it to the playoffs each of the pat three years. The Coyotes had the best season in franchise history in 2011-12, generating a wave of popularity in the desert with a late-season push to their first NHL division title and by reaching the Western Conference finals for the first time.
Bettman and Jamison both said they hope to have a deal in place over the next couple of weeks, which would the team financial room to be players in the free agent market and re-sign players like captain Shane Doan and Ray Whitney.