Ownership Cluster**** Thread: NHL and GJ, Put Up or Shut Up!
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09-28-2012, 12:02 AM
Join Date: May 2010
Originally Posted by
Nothing can ever be straightforward in this situations; it may be a law in Glendale's books. But here was a little blurb on the debt refinancing:
Also, the $6M figure they use if the Coyotes leave was not a true figure. It was a "bid" they received from one of the Councilmember's buddies in the "Monarch Group", which has no experience in booking events.
It will be had for a group to organize the previously booked 10 non-hockey events (rough guess) plus additional events to replace the 50 events with an average attendance of 13,244 (regular season+playoffs). US Airways is killing it in bookings right now. But I have also noticed bands want to book the many smaller arenas around town. I myself will be attending the Green Day concert in the smaller, much smaller, Marquee Theatre in Tempe.
If they team leaves, it would be hard to replace the lost sales tax from the hockey events, thus the reason bonds would be more difficult to sell.
Reading that article again makes the situation even less clear. It implies that the reason for bond rating issues is the drain on the COG's finances from the $25 million payments to the NHL to keep the Coyotes in town.
Moody's Investors Service cited Glendale's large payouts to the National Hockey League as it downgraded the city's bond rating on a portion of its debt, about $680 million.
Moody's said the NHL payment led to a serious drop in reserves in the general fund, which is the pot of money that pays for services from parks to police. The reserves declined from $38.8 million in fiscal year 2010 to $11.7 million last fiscal year.
Admittedly, payments to Jamison will be less than that, but it is hard to read from that article the notion that maintaining the Coyotes with a high AMF will assuage the concerns of the bond raters. Also, the article was written before the Jamison lease was made public, complete with over $320 million in payments from the COG over 20 years.
Moreover, revenue from retail sales tax and other ticket surcharges doesn't come close to the additional $10+ million per year that they would pay to Jamison. If the $6 million figure is not correct, then why on earth is Skeete still floating bogus and fictitious figures? How then can anyone believe what is being offered by Skeete and the COG? They seem to pull figures out of the air, or from consultants with dubious credentials. My suggestion is to follow the story beyond the final resolution of the Coyotes situation. If the Coyotes stay, it will be important to note whether Glendale has been able to restructure the debt as they project. History suggests that the COG has been prone to hyperbole when discussing the financial implications of the Coyotes. It would seem that the budget crunch has compelled them to be somewhat more circumspect in their assessments, though it is easy to get the feeling that they continue to use rather crude and unsubstantiated assumptions when painting financial scenarios.
Last edited by Whileee: 09-28-2012 at
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