Glendale council votes to kill Arizona Coyotes deal

In a tense political showdown with hockey fans and a team owner, the Glendale City Council voted to void a 15-year agreement with the Arizona Coyotes just less than two years after the city approved the $225 million deal.

The decision creates uncertainty for the Coyotes' upcoming season and likely will trigger a legal challenge by the team's attorneys.

Attorney Nick Wood said litigators for the Coyotes will start work on claims against Glendale seeking $200 million from the city. Glendale.

Before the vote, Wood warned Glendale officials, that, "If you decide to go forward, you will lose and it will cost taxpayers millions of dollars."

Coyotes President Anthony LeBlanc called the city's action political grandstanding and said it is "not ethical in the court of public opinion."

The city's decision to void the contract hinges on a conflict-of-interest law, common in government contracts, that precludes a person who works on a contract for the city from later representing the other party to the contract.

"This is to protect the taxpayers," Mayor Jerry Weiers said. "I believe (the Coyotes) violated the law."

Glendale City Attorney Michael Bailey, Glendale city attorney, explained that the state conflict-of-interest statute allows a city to terminate a contract within three years of it being signed if a person who was significantly involved in drafting or creating the contract for the city later becomes an agent or employee of the other party of the contract.

In this case, the city reached a separation agreement with former City Attorney Craig Tindall in April 2013 but continued to pay him his salary for six months and relied on him as a consultant. The Coyotes hired Tindall on Aug. 20, about seven weeks after Glendale approved the Coyotes deal.

Tindall worked on a previous contract for Glendale in early 2013, a failed deal with sports executive Greg Jamison, who tried to buy the Coyotes after the NHL took over the team in bankruptcy.

Tindall also advised Sherwood and then-council members Yvonne Knaack and Manny Martinez on the Coyotes agreement via e-mail four days before it was approved.

In the e-mail obtained by The Arizona Republic, Tindall wrote: "I have reviewed the agreement with IceArizona (the Coyotes ownership entity) per your requests and with the understanding of the city manager. Generally, it follows closely the agreement prepared for the Jamison deal."

That suggests that Glendale could argue Tindall was involved in creating the document that became the Coyotes deal.
Tindall was unavailable for comment, said Coyotes spokesman Rich Nairn.

On Wednesday, after more than an hour of comments, many by Coyotes fans critical of Glendale, the City Council voted 5-2 to terminate the agreement.

Weiers voted in the majority with Vice Mayor Ian Hugh and newly elected council members Jamie Aldama, Lauren Tolmachoff and Bart Turner. Council members Councilmen Samuel Chavira and Gary Sherwood, who cast his vote by phone, voted against ending the deal. Both supported the agreement in 2013.

It was the best deal Glendale could get at that time after struggling to negotiate agreements with other potential owners, Chavira said. Aldama tried Wednesday to delay the vote for two weeks to make another effort to renegotiate the deal, but his only supporter on that idea was Chavira.

Close to two dozen hockey fans from around the Valley chastised the council and urged them to honor their agreement with the Coyotes.

"This is our team," shouted Jesse Hurley of Phoenix. "We are sick and tired of being jerked around by (the city) every few years."
Ronda Pearson, a season-ticket holder from Phoenix, criticized Weiers for taking free tickets to Coyotes games in the city's suite.

"I support this team. You don't," she said. "You don't support any sports in this city, not football and not hockey."

Jeff Teetsel, Westgate Entertainment District development manager, said Glendale is once again drawing negative attention.

"We think the city would be better served to celebrate and recognize the positive contribution that the Coyotes have made in the context of economic development," he said. "The impetus for having an arena and a stadium in Glendale has always been economic development."

Glendale resident Gary Hirsch spoke in favor of ending the deal.

"After two years of this contract, we can see we are at an unacceptable level of risk," he said. "This deal is not working."

Weiers and Turner both said they hope the team will renegotiate a deal and stay in Glendale indefinitely.

"We want a fair deal and have an obligation to act on behalf of our citizens," Turner said.

He said the Coyotes are the one that has reneged on the deal by violating the conflict-of-interest law.

Glendale has still not released its audit of the Coyotes' 2013-14 season a year after it notified the team that it would exercise its option to evaluate the team's financial results.

The Coyotes blamed a delay in providing information to the city on the ownership change at the end of 2014, when Andrew Barroway became the majority owner.

Glendale's losses for hockey and concerts at Gila River Arena through April hit $6.3 million, up nearly 14 percent from a year earlier.

The city lost $8.1 million on its investment in the Coyotes for the 2013-14 fiscal year and expects that to grow to as high as $8.7 million for the fiscal year ending June. 30.

Garrett Mitchell and Peter Corbett writes for azcentral.com, a Gannett property.