Judge sends Coyotes' lease deal to voters

Judge sends Coyotes' lease deal to voters

Published Jun. 19, 2012 11:50 p.m. ET

PHOENIX (AP) -- Voters in Glendale can go ahead with a referendum on a lease agreement between the city and the prospective owner of the Phoenix Coyotes after a judge invalidated one section of the ordinance.

Maricopa County Superior Court Judge Dean Fink on Tuesday asked attorneys for the city and conservative watchdog group Goldwater Institute to rewrite a section of the ordinance to show that it was not passed as an emergency measure. He is expected to issue a ruling on Goldwater's attempt to invalidate the entire ordinance soon.

Residents now have 30 days from the June 8 Glendale City Council vote to gather signatures for a public referendum on the agreement.

Ken Jones, one of two Glendale residents being represented by the Goldwater Institute, said he plans to start collecting signatures for a referendum as soon as possible.

"We've already won something; we know we can have a referendum now," said Jones, a plaintiff in the case along with Joe Cobb. "That will give the citizens of Glendale a chance to speak. They've never had that before."

Glendale's City Council voted 4-2 in favor of the 20-year, $325 million lease agreement for city-owned Jobing.com Arena with former San Jose Sharks CEO Greg Jamison, who's heading a ownership group that has a tentative agreement to purchase the Coyotes from the NHL.

Goldwater, which had thwarted previous attempts to sell the team, filed a lawsuit last week to invalidate the vote, claiming the city failed to hold open bidding for arena management, as per its charter, and didn't have the necessary votes to put the ordinance into effect immediately.

Language within the ordinance called for it to be an emergency measure, which would have allowed it to go into effect the day of the vote. But since an emergency measure must be approved by five of the seven council members and the vote was 4-2 -- one member was absent -- that portion of the ordinance was nullified.

Though the ordinance was signed with the emergency measure still in it, Glendale's attorneys argued that there was no need to clarify it since legally it was a moot point without enough support from the council.

Fink agreed, but he still asked attorneys from both sides to come up with language to clarify that it was not an emergency order. He said he will make a decision on wording for the rewritten portion of the ordinance if the two sides can't agree.

"There was a request that I invalidate the entire ordinance," Fink said. "I'm only willing to say Section 7 is inoperable."

A central issue in Goldwater's lawsuit was bidding for arena management.

The lease agreement between Jamison and the city calls for his group to run the arena at a cost of about $15 million per year. Goldwater argued the agreement contradicts Glendale's charter because there was no open bidding for arena management.

Attorney Gary Birnbaum, representing Glendale, countered that open bidding was not required because arena management is considered a professional service, exempted under the charter because a limited number of people can do it.

Goldwater argued that arena management did not require specific training, and Fink asked Birnbaum to clarify what the city considers a professional service, noting that any job could fit that category if someone threw the word "professional" in front of it.

Birnbaum half-scolded Fink by telling him no twice, explaining that Jamison was the only person who could buy the team, keep it in Arizona and run the arena. He added that Jamison signed a non-relocation agreement that would require him to pay $350 million should he move the team.

"The NHL has been searching for three years to find an owner, and Mr. Jamison is the ONLY person who can do it," Birnbaum said. "Anything else is speculative. There really is only one person, and that is the prospective owner."