|Beyond the incredible soap opera of the Phoenix Coyotes|
ownership, what does it all mean to the larger world of
pro sports - and the Columbus Blue Jackets?
As I understand it (and I'm almost certain to be incorrect on some of the presumed facts): The NHL - current owner of the 'yotes, having brought the team out of bankruptcy - and Hulsizer have an agreement in principle for Hulsizer to buy the team. The deal is contingent, however, on a host of considerations from the City of Glendale, Arizona - where the 'yotes are the prime tenant in the relatively new Jobing.com arena. The last, and biggest, of the concessions is the City issuing $100 million in public bonds (For those who don't understand public finance, it's like a municipal mortgage. You issue bonds to finance big, debt-incurring projects like road or building construction and then pay the bonds off over the course of years - principal and interest.) to subsidize Hulsizer's deal. The City then gets a guarantee that he won't move the team until 2041 at the earliest.
The Arizona-based government watchdog group, the Goldwater Institute (named after the late Senator Barry Goldwater, arguably the father of the modern conservative political movement), apparently is of the opinion that this use of public debt could be illegal. The Institute seems to have scared bonding agencies into holding off on issuing the bonds (You don't issue bonds unless you're certain they all will sell.) by hinting at the possibility of a lawsuit should be bond issuance take place. This functionally has stalled the entire sale. NHL Commissioner Gary Bettman was in Phoenix yesterday and strategically blew a gasket about Goldwater to anyone who would listen.
|The City of Glendale, Arizona has made a huge gamble |
on pro sports, as is evidenced by pro sports facilities for both
the NFL Cardinals and the NHL Coyotes.
As a grad student in the field of public administration here in Ohio, the implications for the City of Columbus and the Columbus Blue Jackets are perhaps most intriguing. Nationwide Arena is the only UN-subsidized arena deal in the entire National Hockey League. Beyond that, Columbus voters have indicated (prior to the construction of the arena and the arrival of NHL hockey into Central Ohio) that they did not want public monies to be spent on this whole endeavor. Yet, the team is losing money due to that unique arena arrangement and now is hoping to tap into the local share of the forthcoming new casino taxes (as I predicted - go figure!). This, in an era where the new Governor is touting the state's fiscal crisis as a rationale for upending the status quo in so many corners of our civic life.
The themes between Phoenix and Columbus are so similar: A private endeavor can't justify its existence on purely market-based economic grounds and thus looks to the public sector to pick up the pieces. What would be really interesting is to learn how many other pro sports teams are in the same boat...or which sports teams are able to make it without taxpayer help (might be a smaller group!).
This is nothing new, however. Back in 1998, the Chicago-based (conservative) Heartland Institute was shouting from the rooftops about the whole issue of taxpayer subsidy of pro sports arenas. This, only two years after Cincinnati voters approved a (now-insufficient) sales tax to build Paul Brown Stadium for their NFL Bengals. There are other examples in the article, but the Cincinnati one is most striking (and most "local" to Ohio).
What makes this even more interesting, however, are the times in which we live. Nearly every state in the Union has a healthy budget deficit. Gov. Kasich is throwing around an $8 billion figure for us in Ohio.
What if those new casino tax revenues will be needed to prop up other, now-underfunded, ambitions that could include, say, college sports?
In light of this, how much does the public want (or need) to subsidize its bread and circuses? (Franklin County Government already owns the Columbus Clippers, you know...)
Moving along... Are the days of taxpayer-funded sports palaces over, or at least on hold? Does Ohio have a watchdog with the legal/public relations firepower of a Goldwater Institute to play the issue to a stalemate? And what REALLY is in the best interest of the public?
I'm in the stretch run toward my Masters degree and understand that my upcoming final quarter will feature a "capstone" paper. Gosh, how I'd love to investigate this issue in much more detail.