According to the source, the deal calls for the Coyotes to be sold to True North Sports and Entertainment for $140 million. It’s believed the deal will be announced at something north of $200 million, but that includes more than $60 million in renovations to add 2,500 seats to the MTS Centre in Winnipeg.
The source said the deal has not been signed, but there is a memorandum of agreement in place and that the deal will be signed when the NHL’s deal with Hulsizer officially dies.
And once it does, both the NHL and those on Glendale city council who voted for the $197 million deal with Hulsizer will have a convenient scapegoat to blame for the demise of the pact - the Goldwater Institute. The public watchdog has vowed to file a lawsuit to block the sale of municipal bonds to finance the purchase of the Coyotes. The Goldwater Institute has been steadfast in its insistence the deal between Hulsizer and the city of Glendale, which includes an upfront payment of $100 million to Hulsizer, violates Arizona law with respect to public subsidies.
NHL commissioner Gary Bettman and those on Glendale council who held their nose and voted to approve the lease at Jobing.com Arena to keep the Coyotes in Phoenix will be off the hook and will simply be able to blame the Goldwater Institute and its incessant meddling as the reason why the deal could not work.
But pointing to Goldwater as the reason for the demise of the Coyotes sale is based on the same flawed logic that blames the salary cap for the downward spiral of the Chicago Blackhawks.
Doing so makes sense to Phil Lieberman, a Glendale councilor who has been vocal in his opposition to the deal and was one of two councilors who voted against it.
“I have talked to the Goldwater Institute and they don’t have a case until the bonds are actually sold,” Lieberman said. “There is no possible way, and I stand behind this publicly, that the 5,500 parking spots at $10 a night can pay the $7 million to $8 million a year that the debt service would require to cover the debt. It just can’t be done.”
The lease was expected to cost the city of Glendale $197 million over a six year period, much of which would be covered by a sale of $116 million worth of municipal bonds. But any shortfall would have to be covered by the city.
Lieberman said when the city set aside $20 million for Hulsizer’s management fees for next year, it had to take $9.5 million out of the city’s contingency fund to balance the budget. In a weak economy with unfinished and crumbling infrastructure, Lieberman finds that unacceptable.
Lieberman said there are several areas where the money would be better used. He pointed out the city currently has 20 openings for police officers it won’t fill in order to meet the budget. He also said construction began on a courthouse in his district and $42 million was earmarked for the project, but after just $12 million was spent, the basement was capped until the additional $30 million can be found; the project has been put off until between 2015 and 2017. Also, a cultural center could not be properly completed 10 years after it opened because there was not enough money to do so.
He also said city employees last year had to take a furlough that resulted in a 10 percent reduction in their pay and will do the same this year to account for a five percent pay cut.
“I want streets, I want sewers, I want gutters and I want cops,” Lieberman said. “Making sure that Hulsizer has a $20 million management fee, how does that provide the services to my 39,900 constituents?”
Ken Campbell, author of the book Habs Heroes, is a senior writer for The Hockey News and a regular contributor to THN.com. His blog will appear every Monday throughout the season.
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