[News] UPD: City of Glendale to vote on new arena agreement with Coyotes

[CroFlames]

Originally Posted by troutman

Glendale staffer resigns over arena audit

http://www.azcentral.com/story/news/...1/?hootPostID=[%27ee66921b310213c959f951f97be0a03d%27]

An internal conflict between City Auditor Candace MacLeod and Assistant City Auditor Andrea McDermott-Fields over the Coyotes audit led McDermott-Fields to resign from her $95,000-per-year job with Glendale in April, according to public records obtained Friday by The Arizona Republic.

"The basis of my resignation is that you have changed my findings in a way that is not acceptable to me or in accordance with the information that I have gathered," McDermott-Fields said in her April 21 resignation letter. Glendale hired her in January

So some fishy business going on eh? Just move this team already holy. How thorough of an audit do you need, when the entire world can see (without an audit) that the team is hemorrhaging money.

[Locke]

Originally Posted by CroFlames

So some fishy business going on eh? Just move this team already holy. How thorough of an audit do you need, when the entire world can see (without an audit) that the team is hemorrhaging money.

Again, it just depends on who cares. Everyone knows the team loses money, the City should never have agreed to underwrite losses in the first place.

We had the same deal with Abbotsford and they quickly found out what a bad deal that was.

Apparently you dont need any degree of economic education or common sense to go into Municipal politics.

At the end of the day they entered into an agreement, sure it sucks for them but no one had a gun to their head forcing them to sign it.

[Resolute 14]

Originally Posted by Locke

Again, it just depends on who cares. Everyone knows the team loses money, the City should never have agreed to underwrite losses in the first place.

We had the same deal with Abbotsford and they quickly found out what a bad deal that was.

Apparently you dont need any degree of economic education or common sense to go into Municipal politics.

At the end of the day they entered into an agreement, sure it sucks for them but no one had a gun to their head forcing them to sign it.

Or provincial politics, for that matter.

The problem for the city is that they are screwed no matter what. When the five year escape clause comes up, the Coyotes could relocate to another market in the hopes of turning losses into profits. Glendale will be eating the cost of the arena many years to come, and without a prime tenant to replace the hockey team.

[Locke]

Originally Posted by Resolute 14

Or provincial politics, for that matter.

The problem for the city is that they are screwed no matter what. When the five year escape clause comes up, the Coyotes could relocate to another market in the hopes of turning losses into profits. Glendale will be eating the cost of the arena many years to come, and without a prime tenant to replace the hockey team.

I dont know if thats a zing, but I'll allow it.

You did nail it though. Glendale may even be worse off if they get their wish.

They want to get out of the management agreement but they need the Coyotes to stay, but if they annul the agreement its likely the Coyotes will move thus removing whatever revenue they do generate and then the City is on the hook for the whole cost which is likely higher than their current losses.

The status quo is likely the best they can hope for at the moment.

[Daradon]

Originally Posted by Locke

I dont know if thats a zing, but I'll allow it.

You did nail it though. Glendale may even be worse off if they get their wish.

They want to get out of the management agreement but they need the Coyotes to stay, but if they annul the agreement its likely the Coyotes will move thus removing whatever revenue they do generate and then the City is on the hook for the whole cost which is likely higher than their current losses.

The status quo is likely the best they can hope for at the moment.

Funny thing is, that's what a lot of people were arguing going into the lease.

Still dunno what their council was thinking. I have to think they were just trying to prove they weren't wrong before (much like the NHL) because no one coulda looked at the info and thought it would work in five year barring a miracle.

But politicians have a problem admitting fault.

Between them and the NHL this franchise could have been in a functioning city 7 years ago if even one person had the stones to admit they were wrong. Which woukd have been better for the taxpayers, the city, the team, and the league.

[Resolute 14]

http://www.sportsnet.ca/hockey/nhl/g...-from-coyotes/

LeBlanc strongly disputes recent reports that the team may have violated its management agreement -- "We have never ever been notified in any capacity by city council or administration that they feel there's been any form of violation, not once" -- and says majority owner Anthony Barroway will meet mayor Jerry Weiers this week "just so everyone knows that everything's good."

Also...

An improved financial picture for the Arizona Coyotes will see the city of Glendale receive a “17 per cent” increase in the revenue it receives from the NHL team and its arena operation this year, according to co-owner, president and CEO Anthony LeBlanc.

That 17% increase, according to LeBlanc, means the team is giving between $7-8 million back to the city vs. $6-7 million last year.

And:

"Our (2013-14) losses have been reported at $34-million, but our view of the operating losses, when you subtract those two items [Ribiero buy-out and closing costs of sale of team], our losses for the first year were sub $20-million," said LeBlanc. "Our losses for next year are going to be substantially less than the number being reported for this year, the year we're in right now.

[CroFlames]

Only lost $20 million and not $34?! What are we all fretting about, the Coyotes are doing excellent!

[troutman]

I believe CasualFan on HF Boards is a lawyer in the US, and he always seems to have a good grip on the situation:

Here’s a more genuine Q&A about Y2 of Ice Arizona

Q: Are revenues up this year?
A: Yes. Approximately 17% higher than last year

Q: Are expenses also up this year?
A: Yes. Approximately 10% higher than last year because the AMF was pro-rata last year and full $15MM this year

Q: Are hockey revenues up?
A: No. They are not. Ticket and Parking are down from last year

Q: So where did the revenue increase come from?
A: Non-hockey event revenue is up.

Q: That’s great but couldn’t any arena manager program the arena for those types of events?
A: Yes. Of course they could

Q: And wouldn’t a legitimate arena manager share more non-hockey revenue than the surcharge and parking that IA sends to the city?
A: Yes. You can look up the RFPs to see exactly how much better those management offers were

Q: So when LeBlanc says revenues are up it has nothing to do with the Coyotes?
A: Not really, unless you believe that Taylor Swift will only perform at GRA if the team is a tenant of the building. The naming rights are worth about 3x more with a pro sports team in the building though.

Q: Anthony is bragging about money going to the city but in reality the city would far better off financially with one of the RFP vendors programming NHE instead of the $15MM AMF?
A: Yes. That is a fact

Q: The team is losing money, the city is losing money and this is all very positive?
A: According to Tony, yes.

Q: Well that’s pretty disingenuous?
A: Yes, it is.


It does seem that Anthony is trying to get out in front of the story. He likely knows what the political talking points are going to be already so it makes sense for him to do a media tour to promote his framing of the data sets. It sure is sad that he will not have his local hack Morgan to parrot his talking points any more.

The Arena Finance Reports for FY15 are all public documents. In reviewing them, it seems like IA is kiting assets and liabilities across the various LLCs. From Glendale's perspective, this might be problematic - not that "Team Owners claimed operating income or loss" from Lease Sec 3.3 has any GAAP definition to audit against to begin with. It's almost like the contact was intentionally drafted to provide maximum ambiguity...

Regardless, it is pretty easy to see how someone like Tavares might end up saying the team lost more than they reported because the team offloaded multiple liabilities to the Arena LLC. Among the curious items on the arena balance sheet is a $22M asset that is amortized. Part of the FIG loan (or other debt mechanism) was apparently booked against the Arena LLC. There's some fairly wacky accounting going on between Hockey LLC, Arena LLC, and Holdings LLC. If Hugh(es) has a majority, and that majority directs staff to unwind this, it will not likely be a breach but it will almost certainly be as entertaining as any Enron-type corporate mischief.

http://hfboards.hockeysfuture.com/sh...896079&page=25

[sureLoss]

Coyotes release a statement after Glendale announces they will have a meeting tomorrow to discuss terminating the management and lease agreement

http://coyotes.nhl.com/club/news.htm?id=770386

In response to the posting issued this evening by the City of Glendale of a special meeting of council tomorrow to explore the possibility of canceling the professional management services and arena lease agreement between the City of Glendale and IceArizona, Nick Wood, of the Law Firm Snell & Wilmer, outside counsel for the Arizona Coyotes issued the following statement:

“This is a blatant attempt to renege on a valid contract that was negotiated fairly and in good faith and in compliance with all laws and procedures. In the event the City Council initiates any action to revoke, repeal or otherwise rescind the agreement, the Coyotes will immediately take all actions available to them under the law against the City of Glendale.”

Coyotes Co-owner, President and CEO Anthony LeBlanc added, “This action by the City of Glendale is completely ludicrous, especially in light of the fact that myself and Andrew Barroway visited with the City yesterday and the particulars of this were never raised. In fact, we to this moment have not been advised of this other than the notification on the City website. The City of Glendale is displaying a complete lack of good faith, business acumen or an understanding of a business partnership. We want to reassure our great fans that the Arizona Coyotes are committed to Glendale and playing at Gila River Arena.”

[The Original FFIV]

Originally Posted by sureLoss

Coyotes release a statement after Glendale announces they will have a meeting tomorrow to discuss terminating the management and lease agreement

http://coyotes.nhl.com/club/news.htm?id=770386

What a s**t show. Please take the old nag out back behind the barn and put her out of her misery. Taxpayers don't need to pay legal bills on top of a bad lease agreement. Unless this is staged theatre and there is a relocation deal behind the scenes. It is June after all, and Forbes said relocation is possible this month.

[Jordan!]

Jesus murphy...

[Jordan!]

Originally Posted by The Original FFIV

What a s**t show. Please take the old nag out back behind the barn and put her out of her misery. Taxpayers don't need to pay legal bills on top of a bad lease agreement. Unless this is staged theatre and there is a relocation deal behind the scenes. It is June after all, and Forbes said relocation is possible this month.

It's ridiculous because trust me, whether you want to or not: It's not hockey in the desert that is the problem. It's Hockey in Glendale that is the problem, it's horribly located (yes, I admit it... I live in the East Valley) and Glendale is a piece of garbage city.

Who the hell knows anymore.. If the team goes, I hope it's to Vegas.

[The Original FFIV]

Originally Posted by Bouw N Arrow

It's ridiculous because trust me, whether you want to or not: It's not hockey in the desert that is the problem. It's Hockey in Glendale that is the problem, it's horribly located (yes, I admit it... I live in the East Valley) and Glendale is a piece of garbage city.

Who the hell knows anymore.. If the team goes, I hope it's to Vegas.

Hope so to for your sake. Not that far of a drive.

Sorry man. Looks like the fat lady is warming up. Don't like to see fans lose their team.

[CroFlames]

I like this part the best:

The City of Glendale is displaying a complete lack of good faith, business acumen or an understanding of a business partnership

Do you think? If they had business acumen or an understanding of business they wouldn't have signed the deal in the first place.

[Resolute 14]

They wouldn't have built an arena in the first place if Glendale had any good sense.

Say what you will about Bettman, but when this started, the city would have exhausted the legal process to force the team to say. Now all of the wrangling has the city to the point of being willing to exhaust the legal process to force the team to leave. And the league itself is going to come out scott free, and probably with a relocation fee should the city eject the team.

[Jordan!]

Team wise for me, whatever.. Having family who work for the team is another story. This just never ends.

[CroFlames]

Originally Posted by Bouw N Arrow

Team wise for me, whatever.. Having family who work for the team is another story. This just never ends.

Yeah I guess a lot of folks don't think like that. Myself included.

I selfishly hope the team moves to Vegas. I never really stopped to think about how it affects the average Joe working in and around the club being relocated.

[DoubleK]

I have had the opportunity to attend 1 or 2 games over the past 5 years in Phoenix.

My family is in Mesa and it's a full day adventure, especially if it's a weeknight game.

We'd go more often if this arena was located in Scottsdale, Mesa, Chandler or Gilbert.

Unfortunately you can't move the arena.

Time to close the book on this mistake.

[Ashasx]

How soon could they move? For next season?

I thought Vegas wasn't ready.

[Resolute 14]

Originally Posted by Ashasx

How soon could they move? For next season?

I thought Vegas wasn't ready.

Vegas isn't, but they are pegged for expansion anyway.

Seattle isn't ready either. No chance the league goes there without a new arena deal in hand. Quebec is tough because of geographical alignment. But that could be fixed in a year or two when the Panthers relocate. Just send them west.

Move back into Phoenix proper? Seems unlikely without political will to build a new arena.

Portland is an option. Kansas City. Milwaukee. Houston.

Or for maximum irony, Hamilton.