Phoenix Part XXXII: Bridge over Troubled Goldwater

[HamiltonFan]

No?. McNall cashed a cheque for $25M that went through the NHL admittedly but was from Disneys' $50M Expansion Fee, ergo, Disney paid the guy $25M. Tampas' $50M fee was split up amongst the full membership; as you know, Ron Joyce refused to pay the $50M & tried to lowball Hamiltons' entry into the league with a $30M offer, giving the NHL yet one more reason to pour cold water all over the Hammers aspirations to bring a franchise to Copps'...

Pretty weak response. I'm not going to make a long post to go through the different ways you can look at this, but bottom line is disney should have paid $50 million expansion fee (just like the other 3 teams) PLUS territorial indemnification to LA, which was apparently worth $25 million at that time.

Since you unilaterally decided to bring Hamilton into this discussion, care to provide a link on the $30 million 'lowball offer'? That's the first I've ever heard of the $30 million offer. What actually did happen during that round of expansion, is the nhl refused to tell Hamilton (Joyce) how much the territorial indemnification to toronto and buffalo would be until after they cashed Hamilton's $50 million expansion fee. Is this a legitimate way to do business? Of course not. We won't even get into the fact that seymour knox (sabres owner at that time) told Joyce that Hamilton would get a team 'over my dead body'.

 

[Confucius]

Several Toronto councillers would probably try, but Rob Ford would just call it "gravy" with Don Cherry calling them "left-wing kooks."

Regardless, Ontario MPP's would probably get involved if the situation was truly dire. We have seen them get involved in matters before, including bringing forward a motion to support the iniative for another team in Southern Ontario. I presume the state legislature has no interest in footing the bill of the Coyotes?

I'm listening to the Wolf Blitzer report on CNN. The topic this hour, the U S government spent eight times what it took in for the month of March. Statements made, by 2037 the government will fall apart because it won't be able to sustain itself.

So maybe now is a bad time to ask for 100,000,000 dollars.

 

[Dado]

The GWI isn't blocking the deal.

Clearly they don't have the power to do that. Only the courts and CoG itself have the power to kaybosh the deal - GWI can do nothing except ask.

 

[Donwood]

With no news all the nuts are coming out: this was dated today from AP, which it certainly is not


Ice Edge gives Glendale proof it can buy Coyotes


PHOENIX (AP) — Ice Edge Holdings says it has provided the city of Glendale proof that it has the financing to complete the purchase of the Phoenix Coyotes.



As part of a city council decision June 8, Ice Edge had to provide the financial documents within 10 days. Bank funding is part of Ice Edge's bid to purchase the NHL team. The group of Canadian and U.S. investors would keep the Coyotes in Glendale but needs a new lease with the city.



Ice Edge also says it met with NHL officials in New York this week to outline the company's plan. It says the league is committed to work toward a purchase agreement to keep the team in Glendale.

 

[King Woodballs]

if GWI doesnt have the power.... why has the CoG **** its pants over the deal?

 

[Killion]

Pretty weak response.

Thanks. Preciate it. Check it out, as in Google it, and you'll find Joyce talking about the $30M offer in various interviews. Secondly, we all know the Sabers & the Leafs are a big problem, unable to see the Forest for the Tree's. Hopefully, the new owner in Buffalo & whoever takes over MLSE will see the folly in all of this, seek indemnification fee's that are reasonable in order to pay down their own debts in acquiring their franchises, and get with the program.

 

[Tommy Hawk]

I'm not sure what the point of the comment is. Do you think you presented the same situation? Last time I checked, Joe's Records didn't employ 1000 people, create millions in tax revenue for the city, or operate out of a location that the city spent $180 million to build.

Is is corporate welfare? Of course. So? Tell me it doesn't happen all the time in every city in North America. That is not the issue. The issue is whether the elected officials for the CoG have the right and responsibility to exercise judgment in how they conduct business in the best interest of the people who elected them to make those decisions.

No, they do not have that right according to the AZ constitution. They have the right to purchase items for fair value, not give away taxpayer money to business without receiving , i forgot the term so I will use, fair value in return.

I'm sorry. I didn't realize I was speaking with an expert on the Arizona constitution. And, aside from the GWI and you, no other attorney with skin in the game, law firm, or other organization agrees with the GWI who has gone so far out on a limb to say this "might" violate the constitution "they think". Aside from misstating the standard under the Turken test, I have yet to read a cogent statement from the GWI that explains in clear terms why they "think" this "might" violate the gift clause.

People have suggested the CoG has worked with smoke and mirrors. I suggest the real artist here is the GWI. Puff your chest, and create enormous economic fall out and job loss, and your response is "not my problem."

Perhaps you should go back and reread your ORIGNAL statement that I quoted. I put it above for you. I bold faced a part for you.

All other cities in the US do it because THEY CAN. THose states do have have a "Gift Clause" in their contitution preventing them from doinig so, while AZ does.

So, NO the CoG does not have the right to provide corporate welfare in this deal or ANY other deal no matter how big or small.

 

[Potrzebie]

I'm not sure what the point of the comment is. Do you think you presented the same situation? Last time I checked, Joe's Records didn't employ 1000 people, create millions in tax revenue for the city, or operate out of a location that the city spent $180 million to build.

Do the Coyotes really employ 1000 people? Maybe they should try a few layoffs to cut losses.

 

[Acesolid]

With no news all the nuts are coming out: this was dated today from AP, which it certainly is not


Ice Edge gives Glendale proof it can buy Coyotes


PHOENIX (AP) — Ice Edge Holdings says it has provided the city of Glendale proof that it has the financing to complete the purchase of the Phoenix Coyotes.



As part of a city council decision June 8, Ice Edge had to provide the financial documents within 10 days. Bank funding is part of Ice Edge's bid to purchase the NHL team. The group of Canadian and U.S. investors would keep the Coyotes in Glendale but needs a new lease with the city.



Ice Edge also says it met with NHL officials in New York this week to outline the company's plan. It says the league is committed to work toward a purchase agreement to keep the team in Glendale.

What the heck is going on with the Coyotes?

We were 2 weeks away 4+ months ago, and now we've heard NOTHING in the last 2 weeks other then weird, confusing and nonsensical rumors and shy silence from everyone involved.

Something has to happen at some point! But the question is, of course, when?

 

[Donwood]

What the heck is going on with the Coyotes?

We were 2 weeks away 4+ months ago, and now we've heard NOTHING in the last 2 weeks other then weird, confusing and nonsensical rumors and shy silence from everyone involved.

Something has to happen at some point! But the question is, of course, when?

I wish we would hear the final word soon, this "story" although dated today, is quite obviously from months ago when Ice Edge idiots tried to convince everyone they had the money to buy the team. I think in reality they would have trouble buying a Junior team.

 

[Dado]

if GWI doesnt have the power.... why has the CoG **** its pants over the deal?

Thats a question for CoG. They claim all is good, but then refuse to close the deal.

 

[crazed323]

You have this backwards. As Alberta Yote said, you are implying guilty until proven innocent.

Sure that would be the case if it were before the courts. But it isn't, no one has had any court case brought on them yet. If COG wants to sell the bonds if they want GWI to back off, if they want public opinion to be swayed. Prove it's not illegal. Simply show clearly why it isn't.

GWI has done a good job of conveying why they think it is illegal. The COG has failed in this regard IMHO, and obviously the bond buyers out there feel that way also.

So I will say it again. GWI (at this point in time) does not need prove it to be illegal. Right now COG needs to prove it is.

 

[crazed323]

Exactly, guilty until proven innocent. It's about time we stopped pandering to the criminals.

yeehaw

If you suspect your neighbour is doing something illegal do you call the cops and let them know? The police arrive at their house, maybe question them, seems pretty like the moto with the police force world wide is if they think their is something illegal happening, they would (in their minds) treat a suspect (use your own scenario for reference) as guilty until they prove to themselves that they are not a threat and go on to see if anything illegal is happening (perhaps searching a car).
But it seems right up until a defendant is charged with a crime it's pretty much guilty until proven innoncent.

 

[GSC2k2*]

if GWI doesnt have the power.... why has the CoG **** its pants over the deal?

Thats a question for CoG. They claim all is good, but then refuse to close the deal.

Are you guys simply pretending that you don't know that COG is trying to avoid paying a huge interest rate premium? If so, why?

 

[Robotbike]

Why? Do you think GW hates Glendale?

It is entertaining to speculate on the motives behind Goldwater Institute's actions pertaining to this case.

One possibility is that they are "true believers," acting solely on principle, as they maintain.

However, the Goldwater Institute is at its essence a political organization, and it shouldn't surprise anyone that politics may be in play here.

One interesting, underreported aspect of this story is the nexus between Jerry Moyes and the Goldwater Institute.

For example:

- Jerry Moyes is being sued personally by the NHL for $60M.
- Jerry Moyes is a donor and past board member of the Goldwater Institute. (http://www.goldwaterinstitute.org/file/3182/download/3182)
- The Goldwater Institute did not get involved in government-sponsored in sports-related deals in Arizona in the recent past.

So why did they get so involved in this deal? How do you think Jerry Moyes feels about the NHL these days? Remember the emails posted by GSC and others back in the bankruptcy trial days about the communications between Moyes' legal team and Rodier? It doesn't stretch the imagination to wonder if the Goldwater Institute isn't carrying water on behalf of one of their politically connected friends and important donors and former board members.

I don't think it is unreasonable to assume that much public behavior can be accounted for in terms of operators acting with rational self-interest.

So what is in Darcy Olsen's, Clint Bolick's, and the Goldwater Institute's self interest?

- Increased visibility and publicity
- Which in turn, leads to increased influence and monetary donations
- Which leads to satisfied donors and a satisfied board of directors
- Which translates to increased job security and higher pay, as well as future opportunities at larger nonprofits

If you look at the Goldwater Institute's financials, most of their budget goes to pay salaries. It stands to follow that, the more money they can bring in, the bigger the budget will be, and the more money they can pay themselves. There's nothing wrong with that; we all like to make more money. But it doesn't mean that the Goldwater Institute and its employees are somehow more noble, pure, and free from self-interest than the rest of us.

In 2007, Darcy Olsen made $180,000 as CEO. Clint Bolick made $126,875. In 2009, Darcy Olsen made $227,268, and Clint Bolick made $273,479. Those are pretty significant raises, especially in the context of a recession and declining revenue (Goldwater 2007 revenue was $3,460,951 and 2009 revenue $2,681,328).

Links to the Goldwater Form 990's:
2007: http://www.guidestar.org/FinDocuments//2007/860/597/2007-860597661-048bfad6-9.pdf
2009: http://www.guidestar.org/FinDocuments//2009/860/597/2009-860597661-069a20fd-9.pdf

Who sets their compensation? Their board of directors. If Darcy Olsen, Clint Bolick, and others can harness the current political climate to increase publicity and donations, and please a big donor and friend of the organization (and former board member) like Jerry Moyes, why wouldn't they?

If they can increase the budget and influence of the Institute, they will undoubtedly be rewarded by their board with increased compensation. It would also increase their profile and chances of landing a gig at a bigger think tank with even better compensation.

Again, there's nothing illegal or anything about this. It's just the way the system (and the world) works. But it does get tiresome when Darcy Olsen et al are lionized as heroes looking out for the little taxpayers, when they themselves stand to benefit handsomely, both personally and as an organization, from this situation.

This accounts for the "not our problem" response from Darcy Olsen when asked about the hypothetical scenario where Goldwater would succesfully sue to block the sale after the bonds have already sold, leaving the City of Glendale without a team in the arena but with the liability of the bonds on their books.

 

[jmichael7753*]

The fan 590 reported earlier that Ice Edge is indeed back in as majority backers of the bonds and that the deal is nearly complete. I dont have a link. thats just what i heard on the radio

 

[Winnipeg Jets]

That's some conspiracy theory you have there.

 

[y2kcanucks]

What the heck is going on with the Coyotes?

We were 2 weeks away 4+ months ago, and now we've heard NOTHING in the last 2 weeks other then weird, confusing and nonsensical rumors and shy silence from everyone involved.

Something has to happen at some point! But the question is, of course, when?

Given the point we're at in the season, perhaps that in itself is a telling sign that something has happened and they just aren't announcing it yet? Pure speculation on my part...in a day when no news has come out I guess that's really all we can do anyways.

 

[GSC2k2*]

Sure that would be the case if it were before the courts. But it isn't, no one has had any court case brought on them yet. If COG wants to sell the bonds if they want GWI to back off, if they want public opinion to be swayed. Prove it's not illegal. Simply show clearly why it isn't.

GWI has done a good job of conveying why they think it is illegal. The COG has failed in this regard IMHO, and obviously the bond buyers out there feel that way also.

So I will say it again. GWI (at this point in time) does not need prove it to be illegal. Right now COG needs to prove it is.

They have sent all the necessary documents to GWI. It would IMO be naive to think that GWI actually still believes that it is illegal.

Regarding the "good job of conveying why they think it is illegal", what job are you referring to? They have actually demonstrated nothing. they have not provided any evidence whatsoever. They have made vague allegations regarding what the documents say regarding ownership (without actually saying anything, mind you), and it should interest everyone to know that curiously THOSE documents have somehow not been released on the GWI website. They have supposedly obtained their own parking expert report disputing the COG reports - - -yet somehow that document is not released.

It is blatant partisanship to suggest that GWI has provided any arguments whatsoever.

Perhaps I should tweet them suggesting that they release those documents. Based on history, they don't know what to do until I (or someone else online) tweets or emails them.

 

[HamiltonFan]

Thanks. Preciate it. Check it out, as in Google it, and you'll find Joyce talking about the $30M offer in various interviews. Secondly, we all know the Sabres & the Leafs are a big problem, unable to see the Forest for the Tree's. Hopefully, the new owner in Buffalo & whoever takes over MLSE will see the folly in all of this, seek indemnification fee's that are reasonable in order to pay down their own debts in acquiring their franchises, and get with the program.

I googled it, and couldn't find any evidence in favor of your $30 million figure. I'm going to suggest that it doesn't exist. Please provide a link for your $30 million number. If you can't provide one, then please refrain from using the $30 million figure in the future.

 

[Donwood]

The fan 590 reported earlier that Ice Edge is indeed back in as majority backers of the bonds and that the deal is nearly complete. I dont have a link. thats just what i heard on the radio

That has to be BS, Ice Edge didn't have enough money to buy the team, they hardly have the money to but 100 Million in bonds that could turn worthless.

 

[GSC2k2*]

It is entertaining to speculate on the motives behind Goldwater Institute's actions pertaining to this case.

One possibility is that they are "true believers," acting solely on principle, as they maintain.

However, the Goldwater Institute is at its essence a political organization, and it shouldn't surprise anyone that politics may be in play here.

One interesting, underreported aspect of this story is the nexus between Jerry Moyes and the Goldwater Institute.

For example:

- Jerry Moyes is being sued personally by the NHL for $60M.
- Jerry Moyes is a donor and past board member of the Goldwater Institute. (http://www.goldwaterinstitute.org/file/3182/download/3182)
- The Goldwater Institute did not get involved in government-sponsored in sports-related deals in Arizona in the recent past.

So why did they get so involved in this deal? How do you think Jerry Moyes feels about the NHL these days? Remember the emails posted by GSC and others back in the bankruptcy trial days about the communications between Moyes' legal team and Rodier? It doesn't stretch the imagination to wonder if the Goldwater Institute isn't carrying water on behalf of one of their politically connected friends and important donors and former board members.

I don't think it is unreasonable to assume that much public behavior can be accounted for in terms of operators acting with rational self-interest.

So what is in Darcy Olsen's, Clint Bolick's, and the Goldwater Institute's self interest?

- Increased visibility and publicity
- Which in turn, leads to increased influence and monetary donations
- Which leads to satisfied donors and a satisfied board of directors
- Which translates to increased job security and higher pay, as well as future opportunities at larger nonprofits

If you look at the Goldwater Institute's financials, most of their budget goes to pay salaries. It stands to follow that, the more money they can bring in, the bigger the budget will be, and the more money they can pay themselves. There's nothing wrong with that; we all like to make more money. But it doesn't mean that the Goldwater Institute and its employees are somehow more noble, pure, and free from self-interest than the rest of us.

In 2007, Darcy Olsen made $180,000 as CEO. Clint Bolick made $126,875. In 2009, Darcy Olsen made $227,268, and Clint Bolick made $273,479. Those are pretty significant raises, especially in the context of a recession and declining revenue (Goldwater 2007 revenue was $3,460,951 and 2009 revenue $2,681,328).

Links to the Goldwater Form 990's:
2007: http://www.guidestar.org/FinDocuments//2007/860/597/2007-860597661-048bfad6-9.pdf
2009: http://www.guidestar.org/FinDocuments//2009/860/597/2009-860597661-069a20fd-9.pdf

Who sets their compensation? Their board of directors. If Darcy Olsen, Clint Bolick, and others can harness the current political climate to increase publicity and donations, and please a big donor and friend of the organization (and former board member) like Jerry Moyes, why wouldn't they?

If they can increase the budget and influence of the Institute, they will undoubtedly be rewarded by their board with increased compensation. It would also increase their profile and chances of landing a gig at a bigger think tank with even better compensation.

Again, there's nothing illegal or anything about this. It's just the way the system (and the world) works. But it does get tiresome when Darcy Olsen et al are lionized as heroes looking out for the little taxpayers, when they themselves stand to benefit handsomely, both personally and as an organization, from this situation.

This accounts for the "not our problem" response from Darcy Olsen when asked about the hypothetical scenario where Goldwater would succesfully sue to block the sale after the bonds have already sold, leaving the City of Glendale without a team in the arena but with the liability of the bonds on their books.

While Moyes may or may not know GWI, I can safely say that the LAST thing Moyes would want would be for GWI to succeed and for the COG to not be able to conclude a lease with the team.

If COG successfully completes its lease with Hulsizer, then a huge portion (if not nearly all) of COG's bankruptcy claims go away, and Moyes can collect the remaining several million still left in the bankrupt estate (subject only to some COG minor claims and Gretzky's claim, each of whcih would be dwarfed by Moyes' alleged claims).

As well, the NHL's damages will have been dramatically reduced, thereby reducing the amount payable under his personal guarantee with the NHL (which is the subject of the NHL/Moyes lawsuit).

Moyes stands to save tens of millions of dollars if GWI fails. If i were him, I would be doing everything possible to get GWI off this madcap adventure.

 

[borno87]

That has to be BS, Ice Edge didn't have enough money to buy the team, they hardly have the money to but 100 Million in bonds that could turn worthless.

Isn't Ice Edge part of MH's ownership group? How is it possible they can purchase these bonds if they are in the ownership group....

I floated the idea of MH double dipping and purchasing the bonds himself ("I don't need the City's money to afford the team, I just want it") and if IIRC was told that would certainly be illegal. If IEH is part of MH's ownership group how is that any different?

Can anyone confirm if there is any rule or guideline (SEC?) that would prevent MH or IEH from purchasing the bonds themselves? Beyond the obvious poor optics and ethics associated with such a maneuver.

 

[Donwood]

Isn't Ice Edge part of MH's ownership group? How is it possible they can purchase these bonds if they are in the ownership group....

I floated the idea of MH double dipping and purchasing the bonds himself ("I don't need the City's money to afford the team, I just want it") and if IIRC was told that would certainly be illegal. If IEH is part of MH's ownership group how is that any different?

Can anyone confirm if there is any rule or guideline (SEC?) that would prevent MH or IEH from purchasing the bonds themselves? Beyond the obvious poor optics and ethics associated with such a maneuver.

Yes, I'm certain they are part of his ownership group. Ice Edge is known more for shooting off there mouths then doing anything.

 

[GSC2k2*]

Isn't Ice Edge part of MH's ownership group? How is it possible they can purchase these bonds if they are in the ownership group....

I floated the idea of MH double dipping and purchasing the bonds himself ("I don't need the City's money to afford the team, I just want it") and if IIRC was told that would certainly be illegal. If IEH is part of MH's ownership group how is that any different?

Can anyone confirm if there is any rule or guideline (SEC?) that would prevent MH or IEH from purchasing the bonds themselves? Beyond the obvious poor optics and ethics associated with such a maneuver.

What poor ethics or optics would you be referring to? It would be no different that Hulsizer selling the parking rights to the COG and taking back a note, instead of being paid immediately (which is an option that i am sure has been considered, BTW).

I am not a securities lawyer, but I cannot envision where this would be illegal under SEC rules.