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Goldwater Institute Waiting In The Wings

from E. J. Montini of the Arizona Republic,

In recent years several attempts to bring new ownership to the Coyotes have fallen through, primarily because the Goldwater Institute keeps icing the deals with threats of lawsuits. Now there is a new potential owner, Greg Jamison, and the Goldwater folks promise to go over any proposed agreement like a Zamboni.

On a radio show hosted by Mike Jurecki and Arizona Republic sports columnist Dan Bickley, McCain said last week, “I hope this ownership thing works out, and I hope that the Goldwater Institute won’t try to throw a monkey wrench into it—again.”

The senator’s rhetorical slap shot didn’t find Goldwater’s net, primarily because there is a provision in the Arizona Constitution known as the “gift clause”—a sort of legal goalie. It reads: “Neither the state, nor any county, city, town municipality, or other subdivision of the state shall ever give or loan its credit in the aid of, or make any donation or grant, by subsidy or otherwise ... “

Lawyers at Goldwater used that provision to body-check a city of Phoenix plan to give a developer millions to build the CityNorth retail project. The city complained of roughing and took Goldwater to court, but lost.

Goldwater could use the same constitutional provision to stifle the latest power play being worked out between the National Hockey League, Glendale and potential Coyotes purchaser Jamison.

read on

Filed in: NHL Teams, Phoenix Coyotes, | KK Hockey | Permalink
 

Comments

Savage Henry's avatar

Wow, I don’t think I’ve ever seen so many out-of-place hockey analogies in an article before.

Posted by Savage Henry on 05/13/12 at 01:56 PM ET

Primis's avatar

Wow, I don’t think I’ve ever seen so many out-of-place hockey analogies in an article before.

Posted by Savage Henry on 05/13/12 at 11:56 AM ET

Yeah this.  I wanted to read more but couldn’t stomach it.

Posted by Primis on 05/13/12 at 03:15 PM ET

phillyd's avatar

I did read the whole article and then the comments. Seems to be a little more to this story of the GWI and the Coyotes then is being fully reported.

Posted by phillyd from Southern New Jersey on 05/13/12 at 03:31 PM ET

shanetx's avatar

In recent years several attempts to bring new ownership to the Coyotes have fallen through, primarily because the Goldwater Institute keeps icing the deals with threats of lawsuits.

I think this should read, “Primarily because buying the Coyotes with the intention of keeping them in Pheonix is not a sound financial proposition.”

Posted by shanetx from Floydada, Texas on 05/13/12 at 03:52 PM ET

aaron in phoenix's avatar

I think the only hang up is the arena management fee. Goldwater freaked out when the city was going to sell bonds, and give 100 million up front for Hulsizer to manage the (city-owned) arena.

Since the city owns the arena, they do have to pay somebody to manage it. It’s not the only municipally owned arena either. The Miami heat signed a deal to pay $6.4 million a year to have their arena managed. That was in 1997 dollars. 

So the city has this arena that, with or without an anchor tenant, they have to pay to maintain and operate. They also have about $180 million left on the principle of the loan to build it.

I think as long as the deal is structured in a way that doesn’t involve selling bonds to pay for the management of the arena, it should go through. The other sticking point is the “gift-clause” that everyone has by now heard about.

The AZ supreme court, in 2010 clarified the ‘gift clause’ by adding “

a governmental payment to a private party complies with the Gift Clause only if the payment both (1) has a public purpose and (2) is not grossly disproportionate to what is received in return.

So I believe that the only remaining point to be sorted out is that the arena management fee is “not grossly disproportionate to what is received in return.”

What is the going rate for managing an arena? Im sure Mr. Jamison is well aware of this, and has created an offer that is “grossly disproportionate”. And don’t forget the NHL side, these guys are lawyers, and having failed the last time, will (hopefully) craft an Iron clad deal.

Posted by aaron in phoenix from Section 102 on 05/13/12 at 06:22 PM ET

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Paul Kukla founded Kukla’s Korner in 2005 and the site has since become the must-read site on the ‘net for all the latest happenings around the NHL.

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