Faceoff Factor

More On Phoenix and Hamilton

Matt Bodenschatz | National Hockey League

Aug 7, 12:22 PM | Hype this story!

You may have noticed by now that most of my information on the Phoenix Coyotes situation comes from James Mirtle of From The Rink.

Mirtle is about as savvy of a hockey mind as you will find, and he has a knack for breaking down complicated topics and making them much easier to comprehend.

What I’ve tried to do is break them down one additional level, giving “lowest common denominator” of information.

Today, Mirtle has two stories on the Coyotes, one discussing Jim Balsillie’s impossible goal and another dissecting why an empty arena may be better than a local bid. As always, both are solid reads.

What I’ll do is break them down a bit and add my two cents.

First, Balsillie’s plan.

As heard on The FAN 590 radio out of Toronto, Balsillie has high hopes of not only winning the bid to purchase the Coyotes during the September 10 auction, but to relocate the team to Hamilton for the start of the 2009-10 season roughly three weeks later.

To me, this is about as likely as the NHL contracting the league by eliminating the Coyotes. Then again, I get the feeling NHL commissioner Gary Bettman would prefer folding the franchise than selling it to Balsillie.

Anyway, moving the franchise from the Western Conference to the Eastern Conference would require a re-alignment of the conferences and, subsequently, the divisions — a task that would take considerable time. And that doesn’t even take into consideration that the NHL then would need to re-work the schedule to compensate for the conference and division adjustments.

If Balsillie somehow wins the bid for the Coyotes and survives the inevitable gauntlet set up by the NHL (which, as Mirtle points out, will include a relocation fee, a lease-breaking fee with the city of Glendale, and a market infringement fee with the Toronto Maple Leafs and Buffalo Sabres), he’ll have to wait until the 2010-11 season. Anything sooner is simply wishful thinking.

What’s interesting, though, is that, according to preliminary findings by Mirtle, the city of Glendale may actually benefit from having an empty arena.

This notion assumes that the alternative is a re-negotiated lease agreement with a local bidder, such as Jerry Reinsdorf.

Mirtle points out a study by accountant J. Michael Neal, in which Neal indicates “the city has been taking in at least $5 million less every year than it has paid out.”

In other words, the city of Glendale, even with an extremely favorable lease agreement, is paying more money on the arena than the arena is making for the city.

Mirtle writes, “as bizarre as it sounds, there may be a scenario where a Balsillie win with a small payout to Glendale is ultimately a better deal than keeping the team by way of a pile of new taxpayer generated revenues. (Keeping in mind that the arena would continue to make money by way of other events such as concerts, etc.)”

Interesting, indeed.

The way I see, it, a professional hockey franchise in Glendale/Phoenix is an endangered species that soon could become extinct.

The city of Glendale has little incentive to renegotiate its current lease agreement with the Coyotes, as the city already is losing money on what is considered to be an extremely favorable deal.

In fact, Mirtle said that Rodier actually attempted to renegotiate a deal with the city of Glendale several months ago, and the city had no interest in the idea.

So what makes anyone think the city would agree to negotiate with Reinsdorf, or anyone else, for that matter?

As Neal’s study indicates, it may be beneficial for the city of Glendale to simply accept a relocation fee and move on without a professional hockey team.

And that is exactly what I anticipate will happen — though, again, not until the 2010-11 season.