Done Deal: Coyotes Stay in the Desert, Arena Agreement Reached
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The wandering, the wait, the apprehension and the unknown are all history.
The Phoenix Coyotes now have a home, at least for the next 20 years, and a new owner should be in place within the coming weeks.
With a decisive vote of the Glendale, Ariz., City Council Tuesday night, the Coyotes became a Cinderella story. By virtue of one wave from their collective magic wand, the council approved a $320 million lease agreement with a group headed by Greg Jamison, a former San Jose Sharks CEO, to manage Jobing.com Arena, the Coyotes' home rink.
The arena is located in Glendale, in the western suburbs of Phoenix.
When Jamison entered the council chambers with GM Don Maloney and Coyotes COO Mike Neely just before the meeting, the assembled hockey fans, most wearing Coyotes sweaters, rose, cheered and gave Jamison a hero’s welcome.
With the agreement comes a 20-year, non-relocation clause and a commitment from Jamison to fill at least 30 events in Jobing.com Arena. That’s in addition to the Coyotes' 40-game regular-season slate. If he fails to do so, Jamison is fined by the city of Glendale $25,000 for each dark night.
Additional Coyotes dates could result in preseason games as well as Stanley Cup playoff contests. For now, the uncertainly which enveloped this team like a spider web seems broken, and the Coyotes can move forward knowing their future is relatively secure.
“This is America,” Jamison said afterward. “This is about progress. It’s about forming a partnership with the city, and it’s proof that the team is an important fabric of the community.”
The council vote, by a 4-2 margin, puts an end to three years of doubt and indecision. Ever since previous owner Jerry Moyes declared bankruptcy three years ago, the future and fate of the Coyotes was left to twist in the wind. Even when Jamison and his group came forward 17 months ago, the method to hammer out any type of agreement was as difficult as crushing relocation rumors about this beleaguered franchise.
Still, the council debated the Coyotes' fate for four hours Tuesday night before rendering its decision.
Once in favor of an economic solution to keep the Coyotes in Glendale, outgoing mayor Elaine Scruggs eventually changed her mind, telling the council, “I support those in (public service) uniforms and not Coyotes uniforms.” The reference here is that the city of Glendale, which is more than $1 billion in debt, will be forced to lay off police and firefighters to help pay for the Jamison deal.
That will not happen for another five years because the city collects a Sunshine tax that will expire in 2018. Then revenues decline, but the city is obligated to pay Jamison and his group for the next 20 years.
On the breakdown, the city pays Jamison to manage the arena $11 million in Year 1 of the deal. Then, $14 million in Year 2, $15 million each in Years 3 and 4, $16 million in Year 5, $18 mil each in Years 6 through 10, $17 milion in Year 11, $16 million each in Years 12 through 15, $14 mil in Year 16 and $13 million in each Year 17 through 20.
Still, Jamison’s group has only half of what it wants.
The other half is the Coyotes' franchise and the current owner, the NHL, wants $175 million.
Jamison, who would not reveal his investors when asked by the council to do so during Tuesday night’s session, says the money is in place. Part of the deal with the city of Glendale is that Jamison’s group acquire the Coyotes by January 31, 2013. Jamison said that was written into the deal before the council vote Tuesday night, and that deadline will be met.
“With this vote, we’re ready to talk seriously with the NHL and have the Board of Governors go forward with its approval,” Jamison said. “We expect to have this done by January 30.”
Once control is taken, Jamison, who helped turn the Dallas Mavericks and Sharks into playoff contenders, is ready to create a corporate structure. The immediate need, he pointed out, is to have a marketing department in place, go after corporate sponsors, have suites sold and increase the team’s profile.
Despite his reputation for turning franchises around, Jamison indicated this is not an isolated journey.
“Success comes from a team effort,” he said. “This is not about Greg, but what Greg can do with everyone coming together.”
Jamison’s acquisition of the Coyotes comes at a time when Gary Bettman, the NHL commissioner, remained steadfast in his desire to keep the Coyotes in Phoenix. Still, it was thought by many that Winnipeg, before the Atlanta Thrashers moved to become the Winnipeg Jets, would be the Coyotes' ultimate destination.
Now, the commitment is for 20 years, and the task begins in earnest to maintain a competitive team on the ice and make sure Jobing.com Arena attracts dedicated fans who will continue to fill the building.
Mark Brown is a Featured Columnist for Bleacher Report. Unless otherwise noted, all quotes were obtained first-hand.
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