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

[Wham City]

The NHL may want to consider increasing the price of the Coyotes to $240M or so to reflect the valuable parking rights. I am surprised that the value of this significant revenue source was not mentioned during the bankruptcy trials.

Good point.

 

[OthmarAmmann]

That's exactly what a judge should be doing.

That's actually what a lawyer should be doing. Whether the judge believes him or her is another story. We'll see if it even gets that far.

 

[Fugu]

Let me get this right.

1. COG owns the arena, and presumably the land it sits on and the adjacent parking lot, right?

2. COG signs contract with Hulzier to manage said arena and ammenities. MH will get paid 72M$ to run the arena for the next 5 years (including this year)

3. COG buys revenue rights for parking and naming of arena from Hulzier for 100M$ With annual interest rates at say 5% over 20 years = 158M$

Expected expenses for this deal so far: 230M$

4. Remaining revenue from Current arena naming rights: 18M$

5. Revenue from parking: Unknown, there never was any direct fee for parking in the arena's lots.

Expected revenues 18M$

Bottom line for COG AFAIK: 18M$-230M$= -212M$


Then there's this law that cites that COG can't give money to a private company.

That's what I'm hoping to get out of this--- how exactly are the financial interests of Glendale better with this deal than without?

 

[King Woodballs]

That's what I'm hoping to get out of this--- how exactly are the financial interests of Glendale better with this deal than without?

by the looks of those numbers, they arent.

 

[Niagara67]

Edit: Never mind - I deleted my comment. Still in shock over the parking thing.

 

[Fugu]

by the looks of those numbers, they arent.

Is there ANY reason for COG to do this otherwise? I'm really scratching my head here, but what would motivate them to piece a deal like this for the Coyotes? If the financial figures look worse with the agreement than without..... there has to be some reason for them to consider doing it at all, right? And that reason has to be worth multiples of millions of dollars.

 

[cbcwpg]

Is there anyone who doesn't agree that Hulsizer's deal is even more of sweetheart deal than Reinsdorf's?

Of course Hulsizer's deal is better. At least Reinsdorf was going to pay for some of the team out of his pocket, he just wanted to leave in 5 years... Hulsizer ends up paying nothing and getting a team. Doesn't get much sweeter than that.

 

[Whileee]

Is there ANY reason for COG to do this otherwise? I'm really scratching my head here, but what would motivate them to piece a deal like this for the Coyotes? If the financial figures look worse with the agreement than without..... there has to be some reason for them to consider doing it at all, right? And that reason has to be worth multiples of millions of dollars.

A deep-rooted fear of admitting they were wrong, and an uncanny facility to convince themselves and others of the correctness of dubious policies and decisions? They are politicians after all.

 

[cbcwpg]

Is there ANY reason for COG to do this otherwise? I'm really scratching my head here, but what would motivate them to piece a deal like this for the Coyotes? If the financial figures look worse with the agreement than without..... there has to be some reason for them to consider doing it at all, right? And that reason has to be worth multiples of millions of dollars.

Its called ego.

The current CoG council don't want to be the ones to go down in history as the presiding gov't that let the team go. They would rather go down in history as the polititions that tried to save the team ( even if it costs the CoG everything in the long run ).

 

[MAROONSRoad]

Is there ANY reason for COG to do this otherwise? I'm really scratching my head here, but what would motivate them to piece a deal like this for the Coyotes? If the financial figures look worse with the agreement than without..... there has to be some reason for them to consider doing it at all, right? And that reason has to be worth multiples of millions of dollars.

Do you gamble? Do you know someone that is addicted to gambling? It's called "doubling down," "double or nothing" or denial. You lost all your money at the black jack table and are about to leave, when someone offers to lend you enough money to place one bet, which if you play your cards right, will allow you to recoup all of your evening losses.

GHOST

 

[NHLfan4life]

Its called ego.

The current CoG council don't want to be the ones to go down in history as the presiding gov't that let the team go. They would rather go down in history as the polititions that tried to save the team ( even if it costs the CoG everything in the long run ).

At least they're doing something.
Seems like a good deal to them. Take a few days to read the deal, it doesn't look bad at all. While we will all find problems with any deal, I think this one is the best.

Just bought tickets for the next 3 home games.

MH did get a sweet deal I have to admit...even as a Glendale taxpayer.

 

[CBJ goalie]

Let me get this right.

1. COG owns the arena, and presumably the land it sits on and the adjacent parking lot, right?

2. COG signs contract with Hulzier to manage said arena and ammenities. MH will get paid 72M$ to run the arena for the next 5 years (including this year)

3. COG buys revenue rights for parking and naming of arena from Hulzier for 100M$ With annual interest rates at say 5% over 20 years = 158M$

Expected expenses for this deal so far: 230M$

4. Remaining revenue from Current arena naming rights: 18M$

5. Revenue from parking: Unknown, there never was any direct fee for parking in the arena's lots.

Expected revenues 18M$

Bottom line for COG AFAIK: 18M$-230M$= -212M$


Then there's this law that cites that COG can't give money to a private company.

Hmmmm, where oh where have we seen that $212M figure before????

Everyone knows that this is a subsidy. Goldwater knows this is a subsidy, any judge who "may" listen to any future case knows this is a subsidy, the COG knows this is a subsidy, H knows this is a subsidy, the NHL knows this is subsidy, I know it is a subsidy. I think my friends cat even knows this is a subsidy. Do I think it is insane, yes I do. Do I care, No I do not, since it is not my tax dollars at stake.

Now if the City of Winnipeg decides to fund the complete bomber stadium then I will have a problem with that.

Frankly, I do not think Goldwater really cares if it is a subsidy or not. Good luck to the COG and H they may need it. And congrats to the Yotes fans. You have had to put up with enough BS, you deserve a break.

Picture of said cat:

 

[CasualFan]

No, they really can't. At least not by rooting any of it in common sense or actual facts, including the fact that the majority of those spaces have generated $0 in revenue from Coyotes games each and every year since the arena opened.

Perhaps if I explained it this way: I have an authentic Monet painting in my hall. It has generated $0 in revenue each and every year since it has been there. That does not mean it is valueless despite the actual fact that it has made no money. The City of Glendale could buy it from me, as long as they don't pay a sum that is grossly disproportionate to it's potential worth, and they would be well within the legal guidelines of the Arizona Constitution.

I appreciate your efforts to explain all this, but paying gross sums of money for a revenue stream worth only a fraction of that price still has to pass some sort of sniff test. If there were only 500 spaces instead of 5,500 could the COG still pay $100 million for it and not face any repercussions? What if it was only 5 spaces? How about if the COG purchased the right to sell advertising on urinal cakes in the northeast men's room from the team for $100 million? Is that still bulletproof?

If 'ifs and buts' were candy and nuts we'd all have a lovely Christmas. The city found an item, a term, and a price that they can easily defend no matter how illogical you think it is. Again, the wisdom of buying the parking rights is not on trial here.

The main reason why this is extremely fishy and IMO unlikely to work is that this was a last minute Hail Mary. Why mess around with Reinsdorf and his proposed tax districts? Why try to set up the CFD? Why didn't they just cough up $100 million 18 months ago for "parking rights" if it was so brilliant a strategy? Why explore absolutely every other option first if it was so bloody easy to make a gigantic cash payment to the new owner of the team?

If you don't have a 23 year term in the deal then it's no longer an equitable, now is it. Mr. Reinsdorf's proposal was dependent upon a relocation option which invalidated the parking concept.

This reeks of a "screw it, we got nothing else, we know this is freakin' insane and has abslutely no merit, we're not even going to try to hide it inside a CFD, we're just giving some guy $100 million whether you like it or not, please don't sue us".

I don't think they have to beg anyone not to sue them. I'll be stunned if an attorney files a claim that is almost certain to lose. You do realize that after Glendale won the ruling the city would immediately collect damages from plaintiff including their legal fees, right? The Hail Mary would be trying to block this deal.

 

[MAROONSRoad]

At least they're doing something.
Seems like a good deal to them. Take a few days to read the deal, it doesn't look bad at all. While we will all find problems with any deal, I think this one is the best.

Just bought tickets for the next 3 home games.

MH did get a sweet deal I have to admit...even as a Glendale taxpayer.

So would you consider it a "good deal" for a city of 200,000 or so to pay 180 million for an arena then pay 100 million for the franchise fee and 97 million to operate the arena and then give the arena and team to a private owner for basically nothing. 377 million plus interest charges for the next 30 years. Total cost: well over .5 billion!

GHOST

 

[Fugu]

At least they're doing something.
Seems like a good deal to them. Take a few days to read the deal, it doesn't look bad at all. While we will all find problems with any deal, I think this one is the best.

Just bought tickets for the next 3 home games.

MH did get a sweet deal I have to admit...even as a Glendale taxpayer.

Please, please elaborate.

HOW is this a good deal? You have to have something to back it up.

For example, letting the team leave causes COG to lose $___/yr.

Keeping team here lets COG make $_____/yr, or lose less than figure above.


Fill in the blanks.


?????

 

[Fugu]

Perhaps if I explained it this way: I have an authentic Monet painting in my hall. It has generated $0 in revenue each and every year since it has been there. That does not mean it is valueless despite the actual fact that it has made no money. The City of Glendale could buy it from me, as long as they don't pay a sum that is grossly disproportionate to it's potential worth, and they would be well within the legal guidelines of the Arizona Constitution.




If 'ifs and buts' were candy and nuts we'd all have a lovely Christmas. The city found an item, a term, and a price that they can easily defend no matter how illogical you think it is. Again, the wisdom of buying the parking rights is not on trial here.



If you don't have a 23 year term in the deal then it's no longer an equitable, now is it. Mr. Reinsdorf's proposal was dependent upon a relocation option which invalidated the parking concept.



I don't think they have to beg anyone not to sue them. I'll be stunned if an attorney files a claim that is almost certain to lose. You do realize that after Glendale won the ruling the city would immediately collect damages from plaintiff including their legal fees, right? The Hail Mary would be trying to block this deal.

I understand your points with regard to the legality and the gift clause.

Would you care to speculate why Glendale would enter an agreement that seemingly costs them more to keep the team in Glendale than it would be to let them leave?

I'm too lazy to dig through the numbers (and don't have the time, tbh, at the moment), but why take the more costly route, if indeed that's the case?

 

[aj8000]

Please, please elaborate.

HOW is this a good deal? You have to have something to back it up.

For example, letting the team leave causes COG to lose $___/yr.

Keeping team here lets COG make $_____/yr, or lose less than figure above.


Fill in the blanks.?????

And do not forget to show your calculations Or you will not get any marks.

 

[aj8000]

The more I think about this deal the funnier it is.

Well you all know the old saying....

"Fool me once, shame on you; fool me twice, call me the City of Glendale."

 

[CasualFan]

Would you care to speculate why Glendale would enter an agreement that seemingly costs them more to keep the team in Glendale than it would be to let them leave?

You want me to try to think like Phil Lieberman? No thanks.

 

[RR]

Perhaps if I explained it this way: I have an authentic Monet painting in my hall. It has generated $0 in revenue each and every year since it has been there. That does not mean it is valueless despite the actual fact that it has made no money. The City of Glendale could buy it from me, as long as they don't pay a sum that is grossly disproportionate to it's potential worth, and they would be well within the legal guidelines of the Arizona Constitution.

If 'ifs and buts' were candy and nuts we'd all have a lovely Christmas. The city found an item, a term, and a price that they can easily defend no matter how illogical you think it is. Again, the wisdom of buying the parking rights is not on trial here.

If you don't have a 23 year term in the deal then it's no longer an equitable, now is it. Mr. Reinsdorf's proposal was dependent upon a relocation option which invalidated the parking concept.

I don't think they have to beg anyone not to sue them. I'll be stunned if an attorney files a claim that is almost certain to lose. You do realize that after Glendale won the ruling the city would immediately collect damages from plaintiff including their legal fees, right? The Hail Mary would be trying to block this deal.

Thank you for the analysis. I do want to ask a question related to the bolded part:

If Goldwater did file a suit -- on behalf of a taxpayer(s) -- and the result was the team had to move because the case wasn't litigated in time, and Goldwater eventually lost, what kind of damages, if any, could the plaintiff be liable for? And would the liability wrest solely with the taxpayer(s) bringing the action, or would Goldwater share responsibility as well?

 

[Fugu]

You want me to try to think like Phil Lieberman? No thanks.

Just doing a reality check-- in case I missed something that showed they would lose less money going this route than other options.

 

[aj8000]

Just bought tickets for the next 3 home games.

Why only the next three home games? Why not all of them?

 

[Fugu]

Thank you for the analysis. I do want to ask a question related to the bolded part:

If Goldwater did file a suit -- on behalf of a taxpayer(s) -- and the result was the team had to move because the case wasn't litigated in time, and Goldwater eventually lost, what kind of damages, if any, could the plaintiff be liable for? And would the liability wrest solely with the taxpayer(s) bringing the action, or would Goldwater share responsibility as well?

One is overlooking that the NHL has the option of moving the team, not an obligation to do so. Their legal department surely could figure out how exposed they'd be if there were to be a suit. I somehow think this would be the least of their worries, assuming the commitment is there.

 

[aj8000]

Thank you for the analysis. I do want to ask a question related to the bolded part:

If Goldwater did file a suit -- on behalf of a taxpayer(s) -- and the result was the team had to move because the case wasn't litigated in time, and Goldwater eventually lost, what kind of damages, if any, could the plaintiff be liable for? And would the liability wrest solely with the taxpayer(s) bringing the action, or would Goldwater share responsibility as well?

From my understanding Goldwater just provides the legal team, do they need an individual from Glendale to file the complain (could be wrong)? Awarding damages are fine; however, you would not get blood out of a stone since most individuals bringing the suit would not have millions of dollars in assets.

One wonders if Moyes is a Glendale resident??

 

[MAROONSRoad]

I don't know much about this agreement or if this has been discussed here yet, but someone posted this on twitter. I assume there had been no assignment of the parking rights to COG. I refer to 5.1 in the attached. Anyone familiar with this?

http://beta.images.theglobeandmail.com/archive/00660/Glendaledocs_pdf_660002a.pdf

GHOST