Phoenix Coyotes

May 17, 2011

Transcript:

Ted Simons: Good evening, and welcome to "Horizon." I'm Ted Simons. The Glendale city council agreed to pay the NHL $25 million last week to keep the coyotes in town for at least one more season. Here with an update is Rebekah Sanders, she's been covering the story for "The Arizona Republic." Good to see you again. Thanks for joining us.

Rebekah Sanders: Thank you so much.

Ted Simons: $25 million to keep the team here. But just for one year. Correct?

Rebekah Sanders: That's right. Through the 2011-12 season. So the hockey fans who were Windsor binge drinking maybe going to the playoffs for the last time, this season, they'll have another year.

Ted Simons: Another year to live on the en, because nothing has been done concretely. Correct?

Rebekah Sanders: Right. The team is still owned by the NHL, so its future is uncertain. And that leaves a lot of people in the lurch. Everyone wants a resolution to this team's future, but it's not in sight so far.

Ted Simons: The $25 million that was just approved by the council, where does it come from, what does it pay for?

Rebekah Sanders: So the city agreed last year to pay the NHL $25 million to keep them through this past season. And they've done it again. It's an amount that depends on the cost of running the arena as well as the team. So it keeps the NHL managing the concerts, managing the games and keeping the team playing, all the costs to get the ice cold, and all of that. And the money comes from the city's general fund for this next coming season.

Ted Simons: So already -- essentially already budgeted to a degree?

Rebekah Sanders: It's already budgeted. Correct.

Ted Simons: OK. 5-2 vote on the city council.

Rebekah Sanders: That's right.

Ted Simons: Who voted no and what were their concerns?

Rebekah Sanders: Sure. The no votes were councilmen Phil Lieberman and Norma Alvarez. Lieberman has been in the opposition camp on many of these votes, so not all of them throughout. He says that he's worried about the city's debt load, he's worried about this money actually -- the deal for the team coming through. And Norma Alvarez is a new council woman who ran on a platform of no money for sports, more money for community. And so that was her reasoning.

Ted Simons: OK. That was the reasoning, those were the "no" votes. Describe the scene at the city council, because it sounds like it's a pretty raucous affair.

Rebekah Sanders: Oh, this time around, last week was pretty raucous. There were more opposition residents and people who oppose this deal than I've seen before, but there was also a large number of coyotes fans, as there have been at all of these events.

Ted Simons: Now, correct me if I'm wrong, but it sounds like Matthew Hulsizer, the guy who's prominent in buying the team this latest deal, the number one guy, he wasn't there and no one from his group was there?

Rebekah Sanders: That's right. He came to playoff games in April, he was at the December council meeting in which his preliminary deal with the city was approved. He wasn't there this time and his representatives said, well, this is a deal between Glendale and the NHL. It's not between us and Glendale. So we're not going to be there. But it does also point probably to some tension among all of the parties that this deal, which was supposed to be done in November, December, maybe at the latest January of last year, it's not done yet.

Ted Simons: It's not done yet, and from the stories you were writing it sounds like they were also like hints that maybe there's somebody else out there waiting to give it a shot. Is that the impression you got as well?

Rebekah Sanders: That was the most striking change in language at the council meet can, that all this time it's been language about the Hulsizer deal, and we're going to get this deal done, and then at the council meeting both from NHL officials and Glendale officials, it was always, if we get this deal done with Hulsizer or another potential buyer.

Ted Simons: Is there any word out, there any rumor who this potential buyer might be?

Rebekah Sanders: Lots of talk. One of the possibilities that's been floated is that perhaps the city is trying to get Jerry Ryansdorf the Chicago sports mogul, back involved. He's been in and out of this process about three or four times, but they certainly have a relationship with him. Namely because of his White Sox team playing at Glendale's ballpark and for other reasons.

Ted Simons: And they also have an extra year now, not only to work with Hulsizer, but to maybe work with Ryansdorf whoever else happens to come down the pike.

Rebekah Sanders: They have another year, but a lot of people say please don't take that full year. It's already been two years since the coyotes first went into bankruptcy, and all of its financial problems surfaced. Another year is just going to be difficult on fans, on the team, on the team budget. It's not a good situation if it lasts that long.

Ted Simons: What was the Goldwater Institute's take on this $25 million more going to the NHL?

Rebekah Sanders: The Goldwater Institute has opposed the city's deal with Hulsizer, saying it puts taxpayers at risk, it amounts to a government subsidy of private business, which they say is illegal. But on the $25 million agreement, Goldwater has kind of stayed hands-off. They've said we're analyzing it in the context of the full team agreement, Glendale's agreement to keep the team, and we're not going to wade in with a lawsuit right now if we haven't seen everything play out.

Ted Simons: Speaking of lawsuits, we had heard somewhere in the dim and distant past that the city of Glendale was thinking of suing the goldwater institute because of what the goldwater institute has done in kind of mucking up the works for selling these bonds. What happened to those plans?

Rebekah Sanders: The NHL and Glendale both said that Goldwater was harming the city financially by raising questions, by writing letters to bond agencieses about their potential lawsuit and kind of scaring off investors. So there was talk that Glendale might sue Goldwater for damages. But that never materialized. And there were a lot of attempts in different ways including bringing on intense public figures such as Senator John McCain to get Goldwater to back off so the deal could go forward. But they never really took hold with the group.

Ted Simons: I guess in another year, I guess could you look at it this way as well, if there is a legal option for the NHL and/or the city of Glendale, gives them more time to figure that out.

Rebekah Sanders: It does, and Goldwater has said here are some options, but of course the amount of money involved and the team's history, and needs financially make everything complicated, as well as how many parties are involved. The NHL, the team owner, the Glendale -- it's very complicated.

Ted Simons: So with all this complication, what's next? What do we look for? What do you expect to see in this drama?

Rebekah Sanders: Well, I think the next thing to watch for is whether Hulsizer will stay in the deal or announce he's out, and if he stays in, you'll have watch for what's the next step. How will the deal change in order to move it forward. If he drops out, then you'll be watching for, well, who's the buyer that Glendale thinks they can get in here and work out a deal with?

Ted Simons: Real quickly, is there a possibility that if Hulsizer drops out, and whoever these other people are, just aren't panning out, the NHL could say, it's $25 million is fine, but we've got a buyer, we're leaving town. Even though there's an agreement to stay one more year? Is that agreement pretty fixed?

Rebekah Sanders: The agreement looks pretty concrete for this coming season. So I wouldn't say the NHL would break that lease and move the team in the middle of the season. It doesn't make financial sense. The question will really come more in the April-May time frame of next year if the deal isn't done. What's interesting about this agreement is that it also provides for an extensive annually of up to 10 years of the NHL managing the arena, and it's not entirely clear if that means that it's 25 million from the city and each annual extension, but there seems to be some consideration of whether this goes on longer.

Ted Simons: Oh my goodness gracious, so -- this could be the beginning of the beginning instead of the beginning of the end. Thanks for joining us. We appreciate it.

Rebekah Sanders: Thanks a lot.