Monday, April 18, 2011

Get Out of the Way

I am against public subsidizing of businesses or especially sports teams as these subsidies often come at the expense of the social safety net.  When a government entity, such as a city or a county, does make the decision to provide financial "incentives" or to build a new stadium for a company or team to locate there, we need to do all we can to protect the public's investment.  Thus, I am very disappointed in the actions of the Goldwater Institute to scuttle the city of Glendale's attempts to keep the Phoenix Coyotes in town.

Like many, it is difficult to wrap my head around the idea of playing hockey in the desert, let alone professional hockey.  Yet, that is exactly what the NHL's Phoenix Coyotes are doing and appear to be doing well.  The Coyotes first played in Phoenix's US Airways Arena (formerly America West Arena), which they shared with the NBA's Phoenix Suns.  Then Glendale wooed them away with an arena of their own.

To say that the Coyotes have had financial issues is an understatement.  The Valley of the Sun doesn't lend itself to a natural affinity for hockey as say Detroit, Boston, Montreal or any other location where snow and ice are a common feature.  Attendance at the games is next to last in the league, with an 2010 - 2011 average of only 12,208, only ahead of the New York Islanders.  Couple that with the high debt load of the owner and bankruptcy was inevitable.

The NHL is currently the conservator of the Coyotes and is looking for a buyer.  They think they have one who will keep the team in Glendale, but he needs help with securing the financing.  Glendale has offered to provide the financing through the sale of bonds and guarantees by the potential buyer to keep the team in Glendale until at least 2041.  As we all know, even during these chaotic economic times, municipalities are still able to get cheap financing through bonds.

In steps the vaunted Goldwater Institute, the conservative taxpayer "watchdog" group.  They want the deal stopped and have threatened to take the city of Glendale to court under a provision of the Arizona Constitution that is supposed to prevent government entities from providing financial support to private entities.  Those of you from Arizona reading this can stop laughing now.  We all know how selective the Goldwater Institute is in attempting to apply this provision (especially since they are behind efforts to privatize public services).

The actions of the Goldwater Institute have already increased the cost of the bonds to Glendale, should the deal go through, and have threatened to send the Coyotes to Canada.  In other words, by claiming to be protecting taxpayers, the Goldwater Institute is actually threatening the tens of millions the taxpayers of Glendale are already on the hook for.  The Goldwater Institute also threatens the vitality of Westgate, which the Arena anchors.

If the institute were so interested in protecting taxpayers, they would get out of the way and let the deal go through.  They didn't stand in the way when Glendale first brought the Coyotes to the city and they shouldn't be doing so now.  Let Glendale protect its already massive public investment.

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