It seems there may be some potential problems concerning the two bids
for the Phoenix Coyotes. Well, aside from the issues we already know
about that’s held up the sale for so long.
litigation ‘think tank’ the Goldwater Institute may have some serious
concerns over the bids put in for the Coyotes, specifically the one by
the Jerry Reinsdorf-led Glendale Hockey, LLC bid that signed a MOU late
last week. The institute has threatened to file suit against the City of
Glendale if it feels there is an unconstitutional move by the city in
order to give incentives to a potential new owner in order to keep the
team in town. As Goldwater puts
Several media reports have indicated that the
City of Glendale intends
to offer some form of taxpayer subsidy to a new owner of the Phoenix
Coyotes as an incentive to keep the hockey team in Glendale. This is a
potential violation of the Arizona Constitution’s Gift Clause.
institute has been in a constant struggle with the city over the
release of public records in the case, and now it seems they may have
serious issue with Glendale Hockey’s agreement with the city. Brahm
Resnik of AZCentral.com has this, from Institute attorney Carrie Ann
As they are written now, the Reinsdorf deal
raises serious legal questions. It
puts a huge amount of risk on the city, whereas Reinsdorf takes on
virtually none. It could be a contract without a give and take from each
side, which would be illegal. Beyond that, the city might make
substantial payments to support Reinsdorf’s ownership and still lose the
team after five years.
are just loose agreements between the city and the two bidders in order
to get the process started on leasing the arena and purchasing the team
from the NHL. In reading the two MOU’s there is certainly a disparity
in how each side will approach payments of the team purchase and it
seems that the Glendale Hockey MOU puts an incredible amount of pressure
on the City of Glendale to be able to maintain a significant amount of
revenue, else the team would up for sale once more in five years.
the City of Glendale does side with Glendale Hockey, and this is the
route the agreement goes without further amendments to appease the
taxpayers, then a sticky situation will get even uglier.
is one thing both sides agree upon: After sale of the team, the buyer
will appeal to the NHL to change the name of the team to either the
“Glendale Coyotes” or the “Arizona
Cardinals” (Sigh. Should read “Coyotes”.)