Part XV: Phoenix - the battle of evermore (UPD #443ff 14-Dec agenda/lease links)

[kdb209]

Item 24 is a request to issue $125 mm in bonds and declare an emergency.

Iterm 24 looks like the source of the $100M upfront money for the parking rights.

The emergency clause was required (as stated):

"An emergency clause is needed so that the ordinance will take effect immediately to address interest rate fluctuations in financial markets and to lock in the interest rate"

The Agenda item states that the bonds will be sold by the Glendale Municipal Properties Corporation (MPC) - the same entity which sold the 2003 A & B Arena Bonds.

The City is selling and backing the bonds, not a CFD.

The MPC bonds are described as being "paid from the pledging of certain excise taxes and receipts imposed or received from the city".

The pledging of excise taxes sounds very similar to the security pledged on the Arena Bonds - a lien against future city excise taxes.

C&P from an old MPC bond post - since my link to the MPC 2003 A & B Offering Statements seems to be dead.

edit: One minor correction - the bonds are not general obligation bonds. They are not backed by CoG general funds. Their payment is secured only by a lein on "Unrestricted Excise Taxes" which includes all excise, transaction privilege, franchise, and income taxes collected by the city and CoG's share of state personal & business income taxes and sales taxes distributed by the State to municipalities.

 

[OthmarAmmann]

The NHL is lucky that the mainstream media barely cares about covering this kind of thing because forcing a failing city to pay out hundreds of millions of dollars to prop up a failing hockey team is an embarrassment no matter what market it's in.

It looks like the NHL and Hulsizer are going to try their damnedest to bankrupt that city.....

It kinda blows a hole in that whole "not running out on the city" argument. Reminds me of that part of Goodfellas where they max out the credit of the restaurant and then burn it down for the insurance money.

 

[kdb209]

Havent read the entire tome but initial observations;

1) COG assumes mgmnt of arena & parking, receives all revenues for latter AND advertising (rinkboards, naming rights etc) revenues. Costs city app. $17M per annum, off-set by said revenue streams.

2) No "out" or "relocation" clause.

3) $100M paid to Hulsizer for said rights.

So. He doesnt control the arena. Receives nothing from parking, concerts, concessions. He cant get out of the lease & relo in 5-7yrs. He has the option to buy the building in 5. The COG is handing him a cheque for $100M. Is that about right?...

No - don't believe that CoG is getting current advertising and naming rights. The revenue is described as new revenue. It sounds like CoG will be selling new advertising and naming rights - on what, who knows.

 

[Wham City]

If Hulsizer buys the team is the COG still on the hook for this year's losses?

 

[AllByDesign]

Very interesting. No wonder Hulsizer has a big smile... and I always thought that was as a result of his wife... silly me.

 

[Snarky Coyote]

looks like the fat lady is starting to sing here.

Well done Gary and MH,

For those of you on the relocationist agenda, lets hope there is a 31st Peg team and a 32nd Quebec team announced soon. Hockey is wonderful, no one should have to live without it.

 

[OthmarAmmann]

"An emergency clause is needed so that the ordinance will take effect immediately to address interest rate fluctuations in financial markets and to lock in the interest rate"

Yeah, they must've been pooping their pants on Tuesday and Wednesday with the selloff in Treasuries.

 

[ATHF]

It kinda blows a hole in that whole "not running out on the city" argument. Reminds me of that part of Goodfellas where they max out the credit of the restaurant and then burn it down for the insurance money.

First thing that came to mind when I read it...

 

[ATHF]

looks like the fat lady is starting to sing here.

Well done Gary and MH,

For those of you on the relocationist agenda, lets hope there is a 31st Peg team and a 32nd Quebec team announced soon. Hockey is wonderful, no one should have to live without it.

Well done? How can anything about this be considered well done, especially when a city that has been cutting vital services left and right will now be shelling out millions of dollars a year for the "privilege" of having an NHL franchise in their building. Hope the taxpayers of Glendale enjoyed their years of running at a modest deficit because those salad days will be long gone soon...

 

[kdb209]

Starting to read through the 150 page tome.

One note from page 4 - a carrot the NHL is dangling to CoG:

"These agreements also position Glendale to host the 2013 NHL All Star Game and related events with a potential economic impact of $10-30 million."

 

[Whileee]

So, Glendale gives MH $100 million for parking, PLUS $17 million per year? That is $185 million over the next 5 years. No sign of Westgate CFD revenues, which doesn't surprise me in the least, as I am sure many of you know based on my previous posts. So much for the notion that "no tax payer money" is going to support the Coyotes.

Oh, and I love the "Fact Sheet" with the "Regional Impact". It turns out that the Coyotes are responsible for the hosting of the Super Bowl, the Fiesta Bowl, a BCS game, etc. because they were the "impetus" for the Sports and Entertainment District. This reads like the opening argument from the defense in a lawsuit from GWI.

 

[Faltorvo]

HAHAHAHAHA!!!!!!!!!!

I TOLD YOU!!! the tax payers were going to need some lube.

Good lord, this would make John C Holmes blush , this insertable would make him envious.

 

[Killion]

No - don't believe that CoG is getting current advertising and naming rights. The revenue is described as new revenue. It sounds like CoG will be selling new advertising and naming rights - on what, who knows.

Are you sure about that?. "Naming Rights" & ancillary advertising sounds pretty specific to the interior & exterior of the job itself. Sure, you can sell billboards, light pole banners, space on the sides of garbage cans in parking lot 'C', but this appears to me to be the whole cheese wheel kdb, and if so, well, its too scary to contemplate..... One just need to look at Edmonton & Northlands (among others)....

 

[David_99]

Well done? How can anything about this be considered well done, especially when a city that has been cutting vital services left and right will now be shelling out millions of dollars a year for the "privilege" of having an NHL franchise in their building. Hope the taxpayers of Glendale enjoyed their years of running at a modest deficit because those salad days will be long gone soon...

It's only $400 a head for every Glendale man, woman and child... For parking rights they should have owned in the first place... No biggy...

 

[GoJetsGo55]

It's been asked a few times but I have yet to see an answer. How can the COG pay $100 million to buy something that it already owns?

 

[Snarky Coyote]

Well done? How can anything about this be considered well done, especially when a city that has been cutting vital services left and right will now be shelling out millions of dollars a year for the "privilege" of having an NHL franchise in their building. Hope the taxpayers of Glendale enjoyed their years of running at a modest deficit because those salad days will be long gone soon...

Trying to understand here, are you local? and opposed to this? are you familiar with the area or just what you read on the internet. For those of us who are Coyotes fans, living in and around glendale this is well done. Im not going to try and say everyone should be happy - personally i could care less what happens in a lot of other cities. In this city, where I live, eat shop and pay taxes and VOTE I am pleased as pie.

 

[ATHF]

It's been asked a few times but I have yet to see an answer. How can the COG pay $100 million to buy something that it already owns?

Pay no attention to that man behind the curtain.....

 

[Faltorvo]

It's been asked a few times but I have yet to see an answer. How can the COG pay $100 million to buy something that it already owns?

Lets see them get that past the GWI.

 

[cbcwpg]

On the last page it has:

LIQUIDATED DAMAGES
From the Effective Date and until _________, 2021: $350,000,000
From __________, 2021 and until _________, 2031 $250,000,000
From _______, 2031 and until ____________, 2041 $150,000,000

Is this Hulsizer's get out of Phoenix Fee?

 

[Snarky Coyote]

It's been asked a few times but I have yet to see an answer. How can the COG pay $100 million to buy something that it already owns?

Glendale doesnt own the land- it is owned by Westgate, the development owned by Steve Ellman. Sorry Glendale doesnt own a single parking space in the area so that is how they can buy the rights

 

[OthmarAmmann]

Does the emergency make state dollars available? The $17mm will more than double their budget deficit, so this hits immediately (nevermind that their parking revenue probably won't be enough to service the $125mm in additional debt).

 

[Snarky Coyote]

Lets see them get that past the GWI.

Nothing for GWI to see here, besides they have dropped the Coyotes and gone after national health care, expect a *****y press release that they are looking into it and then nothing.

 

[Snarky Coyote]

Does the emergency make state dollars available? The $17mm will more than double their budget deficit, so this hits immediately (nevermind that their parking revenue probably won't be enough to service the $125mm in additional debt).

No State dollars are not involved. The emergency allows them to make an offering in the bond market and lock in a rate. It also allows them to place the debt faster

 

[LadyStanley]

The Council Agenda should be released by 7pm (Pacific) which may or may not make for interesting reading & hopefully, mercifully, a patch of blue sky.

Actually 7pm Arizona (which with the current status of year is equivalent to the Mountain Time Zone).

 

[cbcwpg]

Glendale doesnt own the land- it is owned by Westgate, the development owned by Steve Ellman. Sorry Glendale doesnt own a single parking space in the area so that is how they can buy the rights

So if Westgate owns the land... whos getting the $100M for parking rights?