Legislative Update

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Join us for the latest news from the state capitol in our weekly legislative update with a reporter from the Arizona Capitol Times.

Ted Simons: The Arizona Coyotes want state lawmakers to create a taxing district to pay for a new arena for the team. The Coyotes say the team would contribute $100 million to go with the $350 million raised in taxes. Here with an update of this ever evolving story is Mike Sunnucks of the Phoenix Business Journal. Good to see you.

Mike Sunnucks: Thanks for having me.

Ted Simons: This is a new story. This is relatively new stuff here. Taxing district. What exactly are they talking about?

Mike Sunnucks: This has been used throughout the country to finance stadiums and arenas for sports teams. You take a geographic area; you capture some of the sales tax revenue. The hotel tax, tourism taxes. Then you dedicate that money towards bonding or financing for an arena. So you're taking maybe half of the sales tax collected, we'll use downtown Phoenix, parts of Tempe for the arena then you can bond against that, future money against that. It's a debt financing type thing. You're not raising taxes but taking part of a tax poll.

Ted Simons: Is a tacking area usually around whatever it is supposed benefit? If they want to be in downtown Phoenix will that be the district?

Mike Sunnucks: Yes.

Ted Simons: If they want to be in Tempe it will only be there?

Mike Sunnucks: This is how it works throughout the country, L.A. and other markets. If you did it in downtown Phoenix you would get part of the hotel tax and the tax people pay at restaurants and bars. Same for Tempe. I think maybe the city involved with it would have some administrative stuff over top of it, have some members on that board. A way to finance these things without new money which faces a lot of opposition if you're going to taxpayers or voters to ask them to raise a new tax.

Ted Simons: The team goes to state lawmakers. We want a taxing district. State lawmakers say what?

Mike Sunnucks: It has not been introduced yet. There's been a lot of variations on this bill so far. Nothing has been introduced. We're not sure if it's going to get introduced this session or if they might do a special session. They may wait until they announce a deal with a specific city or group or area, then try to do it around that because you also have the Suns are looking for a new arena in downtown Phoenix most likely. You have the D-backs in a big fight with Maricopa County.

Ted Simons: The whole fight is just tell Phoenix --

Mike Sunnucks: At some point maybe the D-backs start looking for a new ballpark. You have three of the four major sports teams in the market for a new home, and that complicates what the Coyotes are doing. Is this going to be applicable to these other teams, other cities that might be bidding on these, or will it be specifically tailored for the Coyotes' arena. Tempe, the golf course seems to be a top site people are talking about.

Ted Simons: We have heard of American Indian reservations, of the Carson site, Tempe, downtown Phoenix with the Suns or without. Always a possibility. What is serious here as opposed to --?

Mike Sunnucks: There's still a lot to play out but I would think right now for the Coyotes a partnership with ASU at Carson golf course is top for them. ASU needs a new arena for the basketball team and the hockey team. It would move the team to more central location. There's always been an issue with them being in the west valley where their fan base is. A lot of fans used to be in the east valley. You would be close to Scottsdale, good concert venue. But the Coyotes are still talking to people. Downtown Phoenix is still a chance but indications are the Suns want their own arena. It's not easy for an NHL team, NBA team to share an arena with dates. Who gets the Friday night, Saturday night dates. How do they share revenue on naming rights and suites and advertising? So generally teams want their own arena. The ones are you see teams share usually have the same owner. The Suns will probably stay downtown. The south building of the convention center. They could tear that down. Move over there. In the backdrop of all this for all three teams is the Salt River tribe by Scottsdale. They already built a ballpark, spring training park for the D-backs. You could go there. The financing is easier with the casino money. It's close to Scottsdale. They all have that in their back pocket as a backup plan if things sour we have elected officials.

Ted Simons: Is that the only tribe they are talking to? The Coyotes now has moved to Tucson, a minor league affiliate. You're on the way to Tucson. Could the Gila river tribe be --?

Mike Sunnucks: There was talk about that but what happened with them moving to the west valley has kind of made people focus on central locations. If you build it down there any of these things you're going to lose a lot of your fan base. People can't drive from the west side or even north Phoenix or north Scottsdale to get there. Temperature me and Scottsdale, it's near a lot of economic base, a lot of population, business there, tourists. Obviously there's a lot of bias towards keeping the Suns and D-backs in downtown Phoenix. I think you'll see Phoenix -- I don't think the Suns are going to leave downtown. I think they will make that work. The Coyotes up in the air depending if they get this through the legislature what their deal is with ASU or anyone else.

Ted Simons: As far as Glendale is concerned, the preferred management group, they operate Staples center in L.A. What are they going to do with that arena?

Mike Sunnucks: The city is still figuring that out. Do you make it into a big concert venue? They get some now. We already have a lot of venues here.

Ted Simons: Probably have another one. Two more.

Mike Sunnucks: Absolutely. Do they start cutting prices to try to get more dates there? Do they sell it? They own the Kings. They have a stake in the Lakers. They operate Staples Center, Barclay Center in Brooklyn. They are a big time company but if the Coyotes leave what do you get there? I think that's going to be something they have to look at. But the city thinks even if the Coyotes are going to have a new arena it's going to be a couple years that they are still going to have to build that. Whether they -- their lease is through next season. Whether they move downtown, the Suns arena for a year, even the fairgrounds for a year, they could do that too. You could have that thing open sooner rather than later.

Ted Simons: It was interesting AEG, this facilities group, they mentioned UFC fights, concerts, did not mention the Coyotes at all as a possible --

Mike Sunnucks: I think it's fait accompli. The Coyotes want to stay in the market but are looking at a different venue.

Ted Simons: What happens to that mall?

Mike Sunnucks: Well, they got the outlet mall. That's helping. Dave and buster's they have football. But those are all sports bars oriented. They need those dates at the arena. That's 40 games.

Ted Simons: Businesses making noise?

Mike Sunnucks: They are upset but shell shocked. They have gone through this so many times I don't think they are quite sure. The way the Coyotes talk they are serious about finding a new home whether that's in two or five years.

Ted Simons: Anthony LeBlanc, the Coyotes' owner, said arena plans would be announced in the next couple of weeks. Was this idea of a plan, tax district?

Mike Sunnucks: That's part of it. They are seriously talking to ASU, Phoenix, even Mesa by the Cubs stadium. Salt River tribe. They have talks going on with at least three, four folks.

Ted Simons: We'll see what happens. Good stuff. Thanks for being here.

Ted Simons: Arizona Speaker of the House David Gowan reverses field and rescinds his demand that reporters covering the house floor undergo criminal background checks. Here with more is Luige del Puerto of the Capitol Times.

Luige del Puerto: They would have found all the shenanigans I did back in college.

Ted Simons: You're in the clear. [laughter] What's going on?

Luige del Puerto: He blinked. After a week of insisting that reporters need to undergo a background check as part of his comprehensive security protocol update that they are doing in the house. Yesterday he decided to rescind the background check policy and allow reporters in. Now, reporters who have had access, the badge, that's still not being activated. The way the new rule is you have to go through the clerk's office and check in and out. That's not a problem for many reporters. So we're going to have access to the floor. In fact we started covering the floor from the press desk in the house yesterday as well.

Ted Simons: So why did Speaker Gowan reverse himself?

Luige del Puerto: His official line is that he had received complaints, concerns from members, and he has taken them to heart. He is still insisting the background check would have been the best route but he said I've heard your concerns, I have taken them to heart and I'm making this change. That is his official line. However, some suspect that David Gowan did this to preempt what potentially could be an embarrassing moment on the house floor. The Democrats had been pushing for a rule change that would have overruled this policy that the speaker had briefly adopted, and one of the Democrats, representatives from southern Arizona, Bruce Wheeler, told a reporter that they had in fact had some support from Republicans in proposing this change and if they had enough votes they would overrule the speaker.

Ted Simons: Basically the speaker would have been rolled on this thing.

Luige del Puerto: That would have been humiliating for Gowan.

Ted Simons: It's hardly a shining moment for him anyway. He has a congressional campaign to worry about.

Luige del Puerto: So the polls are mostly internal polls done show David Gowan 1%, 2%, 3%, he's way, way down in those polls. Of course these are campaign released polls. Take them with a grain of salt. The thinking is those polls are mostly name I.D. polls which means we have someone like Paul Babeu, who has a greater name I.D. than other candidates in the race. I spoke with one consultant yesterday. He said David Gowan doesn't stand a chance in the race to begin with. So the troubles that he's created for himself by imposing this policy, ends of the day didn't really matter much.

Ted Simons: Tree falls in the forest. It doesn't -- all that.

Luige del Puerto: Right.

Ted Simons: There was a rally at the capitol regarding Kids Care. This is a major topic here. We have had Senate president Biggs on, relatively high profile regarding his opposition what seems to be a one-man opposition to Kids Care. Big old rally trying to push him to act. What went on?

Luige del Puerto: So the fight has now shifted from away from this bill that supporters of Kids Care had been pushing for several months now into the budget. It's become a budget fight. The reason for that is the governor's office or rather governor Doug Ducey hinted to reporters that he's open to negotiating over Kids Care in the budget. That's where the fight is heading to. I presume what you would see is a whole lot of pressure and a whole lot of activity to try to convince the governor that this is the right thing to do and if they are able to do that it would be the governor fighting for the restoration of Kids Care.

Ted Simons: Senator Biggs's argument saying it's not really free. Triggers are supposed to be in place if the government pulls out and we have to take on the full cost. He says it doesn't matter even if it seems free it's not because taxpayers are footing the bill.

Luige del Puerto: That is not a new argument from Andy Biggs. He's argued the same when it comes to Medicaid expansion. You take whatever social welfare program we have and his argument is that even if it's paid for 100% by the Feds ultimately taxpayers pay for it because -- you have to raise money from somewhere to pay for those. Obviously his opposition is very high profile to this. If the governor does fight for the restoration of Kids Care and supporters are able to convince him to do it, then the dynamics really change. Now you have the governor fighting for a program in the state budget. Of course it's all about negotiation. One man alone cannot stop that from -- it has to be some sort of compromise. That's how budgets are done. So there is in fact greater chance of Kids Care being restored if done through the budget than if it's struck down through legislation because if you're doing it through legislation Andy Biggs could say, I'm not going to hear it.

Ted Simons: Now he has to deal with a caucus of one in dealing with the governor.

Luige del Puerto: It's not just that. It's the House, the Senate.

The House, which passed it 4-1 margin.

Luige del Puerto: Correct. If the governor's office were to say we have to have Kids Care, in theory in that negotiation of three people you have two saying let's do this one. It makes it harder to refuse Kids Care.

Ted Simons: Luige, good to have you here.

Luige del Puerto: Thank you.

Ted Simons: Thursday we'll talk about the many ways veterans are honored for their service. And we'll hear from a renowned violinist on how the brain reacts to playing music. 5:30 and 10:00 on the next "Arizona Horizon." That is it for now. I'm Ted Simons. Thank you so much for joining us. You have a great evening.

Video: "Arizona Horizon" is made possible by contributions from the friends of Arizona PBS, members of your PBS station. Thank you.

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