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Hi folks! Here's an update from today's City Council Meeting in Glendale...
The purpose of the meeting was to give the Glendale City Manager (Ed Beasely) the go-ahead to finalize the new Arena Management and Use Agreement (AMULA) and thus proceed with the sale of the team to Mr. Hulsizer. There is much concern about the use of taxpayer money to fund the purchase and/or run the team - which is simply not what is happening here. I'll try to explain this situation as simply as I can...
The City is selling bonds in order to acquire the 100 million dollars it will take to purchase the parking rights from the Coyotes. The original AMULA granted parking and arena management rights to the Coyotes. Currently, we are not charged for parking at any arena event. This will no longer be the case once the team is under new ownership. The City will begin collecting parking fees - this money will be used to repay the money they will spend to purchase those parking rights. Currently the cost to manage the Arena is roughly 17 million a year. If the team leaves, the city will still be on the hook for that 17 million - but will be minus their major money making tenant. 10,000 people coming to Westgate for 42 games per year is better than none. 18,000 is better... but we'll work on that part later.
Should the team flee - there will be no foot traffic to pay those fees. There will be an empty eye sore in the middle of Westgate that will THEN cost the taxpayers 17 million a year to run. Any money will be GENERATED from the Coyotes. No Coyotes, no money. THEN Goldwater should have a problem with the city. Funding coming from revenue streams created by the Coyotes and their fans = no extra cost to the residents of Glendale vs 17 million guaranteed to come out of the taxpayers pockets yearly. Do the math...
Today the City Council approved a motion allowing 10 million of the 25 million that the City gave the NHL last year as insurance to be transferred into an escrow account and used as Arena Management money - should it be needed. It is not anticipated that this money will be needed - as they will be generating money from the parking fees and the voluntary CFD. The money will remain in the escrow account accumulating interest - thus making the City MORE money. That 25 million that was given to the NHL to cover "losses" for this season? It's still there. And then some. It's been collecting interest as well. So there's proof that all parties are doing everything within their power to make this work. Go through and read the documents. What the City and Hulsizer are trying to do is actually help the taxpayers and save them from paying unnecessary costs on an empty arena for the next who knows how many years.
Thank you for the very well written recap!
ReplyDeleteAny conversation about the Goldwater Institute and where they stand on things at present?
As of right now - Goldwater doesn't have a leg to stand on - which is why they haven't done anything. No taxpayer money has been used & CFD's are exempt from the laws they are citing. The city has only put money into escrow accounts & there's nothing illegal about that!
ReplyDeleteGreat - thanks again for the update!
ReplyDeleteYou're very welcome & thank you for reading & commenting :)
ReplyDeletethanks for the update
ReplyDeleteThanks for a thourough explanation. If I remember right the other 97 million is being paid upfront to Hulsizer for arena management fees for x numbers of years. He doesn't have to come up with anything to purchase the team.
ReplyDeleteFor some of us paying 20.00 to park will be a deal breaker. I don't know why Glendale thinks that fans that have been staying away, will suddenly be excited to pay for parking?
I'm a current season ticket holder and with that comes a parking pass. I love the Coyotes with a passion and should my costs go up or the parking pass go away I may no longer be a season ticket holder. Now how much stinking money did it take to build the Cardinals stadium? And that's next door! I don't believe they charge for parking so long as you have a parking pass. As I understood something that was said a number of months ago the City of Glendale wants to make a special parking area just for the hockey games and that will include some of the parking that is already there. That to me works but paying for parking doesn't. People are staying away now even when we are WINNING and the parking is free for the most part!! Oh did I mention we are in 1st place in our division!! I know a lot of people and so called experts say that this is a hard market to sell hockey in but this is the biggest transplant state in the US. Who cares who comes to the games so long as they are coming!!!
ReplyDeleteWhat about the people who are going to Westgate to attend a movie or have dinner on a game night. Will they also have to pay 20.00 to park?? How are they going to know who is there for the game and who is there to shop and frequent the restaurants? I can forsee all kinds of problems with this. The way Westgate is set up, I thought the idea was to get people there, whether or not they are going to a game.
ReplyDeleteCharging for parking is not going to help.
There will be kinks to work out I'm sure. We don't know yet if they will start charging season ticket holders for parking - I hope not. And I would think not. We don't know if all of the lots will be pay lots. I don't think THEY even know that yet.
ReplyDeleteThe Cardinals STH's aren't charged for parking - if I remember correctly. But they DO charge for parking at Cardinals games now in certain lots. I'm not sure if it's all of the lots or not. But if you want to park in the stadium lots, I believe they charge for parking. 20 bucks per vehicle. We are one of the teams - if not THE only team - that doesn't charge for parking. In any league. Anywhere.
So we have the cheapest ticket prices in the league and free parking. We don't have much to complain about right now. We're used to it and there will be some complaining from those who don't like the change. But with a winning team - just like the Cardinals - people will pay it and they'll come watch the team play.
The other 97 million (or however much it is) that will be paid to Hulsizer over the period of time agreed upon is payment for him managing the arena, as I understand it. Glendale is buying back arena management and parking rights from him. The lease was arranged differently with the previous ownership. I believe they are doing that because they want an iron-clad lease agreement. "Here - this is what we're willing to do to keep this team because we believe hockey in the desert can thrive under the right ownership." Obviously they believe Mr. Hulsizer to be the right owner. If things go as hoped - it will be beneficial to both parties.
I'm not sure of all the technicalities and details of it - I am not privy to the lease agreement. But they've agreed to pay him a specific amount of money to manage the arena - because they own it. If they don't pay him to manage it, they'll just have to pay someone else to manage it... And they'll be paying a lot more to fill up those 42 empty game night.
They'll be spending that money whether they give it to Mr. Hulsizer or Joe Schmoe's Arena Management Company... It is in their best interest to give it to a permanent tenant.
This is where I don't understand the arguments of the 3 City Council members who site the "out clause" and the "taxpayer's money" as reasons why they won't vote for the lease agreement. The "out clause" only goes into effect if Glendale doesn't pay as agreed each year for the Arena Management. Nobody works for free. The Coyotes aren't the only ones who use the arena. So if Glendale doesn't hold up their end of the bargain than Hulsizer doesn't have to hold up his agreement to keep the team in Glendale for the remainder of the lease. No good business person would commit themselves to anything less.
As for the taxpayer money - well I explained that in my post. I see this lease agreement as more of a partnership deal. You hold up your end of the bargain and I'll hold up mine.