@GLENDALELEA:
Without the Coyotes, Glendale has a deficit of $24M. With the Coyotes, #Glendale has deficit of $25M. $1M Difference. We still need revenue.
I remember a while back when news broke about the NHL wanting to pay to get the team out of bankruptcy so Jim Ballisile didn't get his hands on the team, this question was asked; Are the Phoenix Coyotes going to be the Phoenix Expos?
That question was asked in this idea that the team could end up on a simular path as the Montreal Expos with the same kind of ending. Does it seem more and more now with the lockout in place that the Coyotes are looking more and more like the Expos?
NO. They are better off by $1M if the Coyotes stay.
Stay -$24M
Go -$25M
Neither is attractive but negative 24M is better than negative 25M.
Quote:
Originally Posted by naurutger
Perhaps he has it backwards but in the article, Martinez uses the $24M figure if they go.
The point is that the sales tax initiative is deadly to Glendale and its residents...... period. This is the message Glendale failed to convey back when they approved the increase. Everyone was too focused on what it meant to the Coyotes.
NO. They are better off by $1M if the Coyotes stay.
Stay -$24M
Go -$25M
Neither is attractive but negative 24M is better than negative 25M.
This makes the assumption that Glendale will be able to restructure $8 million in debt if the Coyotes stay, and that they won't be able to do that if the Coyotes leave. Has anyone seen any justification of that assumption?
The point is that the sales tax initiative is deadly to Glendale and its residents...... period. This is the message Glendale failed to convey back when they approved the increase. Everyone was too focused on what it meant to the Coyotes.
Absolutely, TL. The conflation of the Coyotes lease agreement with Jamison and this year's budget process was perhaps the most egregious misstep by the COG and Jamison. They should have put the Jamison lease and sale to bed long before the budget discussions. It was entirely predictable that there would be a political price to pay for the Coyotes' supporters if the lease was discussed in the context of a substantial budget deficit.
This makes the assumption that Glendale will be able to restructure $8 million in debt if the Coyotes stay, and that they won't be able to do that if the Coyotes leave. Has anyone seen any justification of that assumption?
Bond and credit rating depends on a Jobbing.com tenant.
Bond and credit rating depends on a Jobbing.com tenant.
Is it really that straightforward? Wouldn't bond and credit raters consider the totality of the financial situation? Who's to say that they wouldn't prefer Glendale's financial situation with a $5 million per year AMF for professional arena management vs. $15-20 million per year for the Coyotes as tenant. An anchor tenant is really only a financial advantage if they generate more revenue for Glendale than it costs Glendale to keep the tenant. I am not sure that objective external observers would be convinced that this would be the case.
In any case, I was just wondering whether the question about the assumption on debt restructuring has been asked and answered by Skeete or anyone else at the COG, or whether it was an unconfirmed assumption.
Is it really that straightforward? Wouldn't bond and credit raters consider the totality of the financial situation? Who's to say that they wouldn't prefer Glendale's financial situation with a $5 million per year AMF for professional arena management vs. $15-20 million per year for the Coyotes as tenant.
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:
Quote:
"The deal is still in progress," said Todd Curtis, portfolio manager for Aquila Tax-Free Trust of Arizona, on Thursday. "That deal has struggled probably because of the downgrade and is probably costing the city."
The question for investors is whether the Coyotes stay in Glendale, Curtis said.
If the teams leaves, it would hurt Glendale's retail sales-tax collections, which back the general obligation debt, Curtis said.
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.
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.
Quote:
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.
Read more: http://www.azcentral.com/community/g...#ixzz27jc9KBdZ
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.
I should add that I think that if any group deserves kudos for preserving the Coyotes in Glendale, and offering hope for a long-term solution, it is the COG. They have steadfastly seen this as a key component of the financial well-being and quality of life in Glendale, and have put their money where their mouth is. They deserve better "partners" than the NHL and the string of ownership hopefuls. Let's hope that Jamison sees the real opportunities in the Phoenix market and the marvelous deal on offer from Glendale and completes the deal quickly.
I have had a few conversations with buddies over why this $6m is being used as a placeholder. I am not sure. Yes from what I have read the other arenas only pay their managers a few million plus a bonus on the events they book. But the cities and the county have to pay for all operating expenses. So my understanding is Jamison would be responsible for those costs which can total around 10 million a year from the US Airways and UofP stadium reports I read on their sites.
So I dont know, madness, corruption, unqualified opinions? Anything could lead to these conclusions. Certainly boggles my mind but I report to another City's Council and they are just as crazy.
edit: gotta ask what is the origin of your name o.o
Mine? Its a dumb one, I went to Northern Arizona University (NAU) and played rugby so instead of rugger, only rutger was available when I chose my user name on another site and its stuck. Looks funny to most people I am sure.
