Post by ducky75 on Feb 25, 2011 23:08:38 GMT -5
www.azcentral.com/arizonarepublic/opinions/articles/2011/02/26/20110226sat1-26.html
As a rule, the free-market think tank Goldwater Institute dependably acts in the interests of taxpayers against the oppressions of government.
Rules get broken. Regarding the matter of Glendale and the primary tenants of its hockey arena, the Phoenix Coyotes, the Goldwater Institute is starting to look like a serious part of a very expensive problem for the city's taxpayers.
Glendale has structured a deal with a potential buyer of the Coyotes, Chicago businessman Matthew Hulsizer, that requires the city to sell up to $116 million in bonds. But lingering over the deal is the threat of a lawsuit by Goldwater, which suspects the deal may violate a provision of the Arizona Constitution.
Mind you, the Goldwater Institute is not actually suing anyone over the deal. It merely is threatening to do so, a strategy that may ultimately cost Glendale taxpayers tens of millions of dollars.
The mere threat of a Goldwater lawsuit drives up the cost of the bonds to the seller, which is Glendale. Bonds that would have paid a 30-year premium of 4.5 to 6 percent may cost 2 or even 3 points more because of the added risk.
Timing has become critical. The very existence of the Phoenix Coyotes as a National Hockey League franchise in Arizona appears to be hanging in the balance, with a final decision perhaps days away. The NHL owns the Coyotes and is frantic to find a permanent owner. And NHL Commissioner Gary Bett- man reportedly is no longer fussy about whether that owner keeps the team in Glendale or moves it, likely to Winnipeg.
There are no perfect choices for the future of this franchise, which, despite it all, has proved remarkably resilient on the ice. Either Glendale taxpayers back the bonds that allow Hulsizer to buy the team and keep it in Glendale or the $180 million facility loses its primary tenant and becomes a dead-certain drain on taxpayers.
There are no white knights in the negotiations, either. As Goldwater contemplated a lawsuit and sought background data from Glendale, the city petulantly dragged its heels at producing documents for months.
For its part, Goldwater appears comfortable with letting the threat of a potential lawsuit hover over the bond sale, a non-decision that would considerably add to the financial cost of the bonds. What's more, Glendale officials are furious with Goldwater for what they consider highly unusual interference in their bond sale, including letters Goldwater sent to bond-rating agencies and others warning about their potential lawsuit.
We consider Goldwater an asset to the community most of the time. Not this time. Not on this deal. Glendale's arrangement with Hulsizer either is a violation of the state's constitutional prohibition of "gifts" to private concerns or it is not.
If Goldwater was certain about its case against Glendale, that would be one thing.
But its very inaction declares its uncertainty. The only "certainty" here is that Glendale taxpayers will shell out even more. The Goldwater Institute should do the right thing by those taxpayers and step aside.
PS from Ducky - Jimi I sent you a pm on this. This is an official editorial board editorial not a blog.
As a rule, the free-market think tank Goldwater Institute dependably acts in the interests of taxpayers against the oppressions of government.
Rules get broken. Regarding the matter of Glendale and the primary tenants of its hockey arena, the Phoenix Coyotes, the Goldwater Institute is starting to look like a serious part of a very expensive problem for the city's taxpayers.
Glendale has structured a deal with a potential buyer of the Coyotes, Chicago businessman Matthew Hulsizer, that requires the city to sell up to $116 million in bonds. But lingering over the deal is the threat of a lawsuit by Goldwater, which suspects the deal may violate a provision of the Arizona Constitution.
Mind you, the Goldwater Institute is not actually suing anyone over the deal. It merely is threatening to do so, a strategy that may ultimately cost Glendale taxpayers tens of millions of dollars.
The mere threat of a Goldwater lawsuit drives up the cost of the bonds to the seller, which is Glendale. Bonds that would have paid a 30-year premium of 4.5 to 6 percent may cost 2 or even 3 points more because of the added risk.
Timing has become critical. The very existence of the Phoenix Coyotes as a National Hockey League franchise in Arizona appears to be hanging in the balance, with a final decision perhaps days away. The NHL owns the Coyotes and is frantic to find a permanent owner. And NHL Commissioner Gary Bett- man reportedly is no longer fussy about whether that owner keeps the team in Glendale or moves it, likely to Winnipeg.
There are no perfect choices for the future of this franchise, which, despite it all, has proved remarkably resilient on the ice. Either Glendale taxpayers back the bonds that allow Hulsizer to buy the team and keep it in Glendale or the $180 million facility loses its primary tenant and becomes a dead-certain drain on taxpayers.
There are no white knights in the negotiations, either. As Goldwater contemplated a lawsuit and sought background data from Glendale, the city petulantly dragged its heels at producing documents for months.
For its part, Goldwater appears comfortable with letting the threat of a potential lawsuit hover over the bond sale, a non-decision that would considerably add to the financial cost of the bonds. What's more, Glendale officials are furious with Goldwater for what they consider highly unusual interference in their bond sale, including letters Goldwater sent to bond-rating agencies and others warning about their potential lawsuit.
We consider Goldwater an asset to the community most of the time. Not this time. Not on this deal. Glendale's arrangement with Hulsizer either is a violation of the state's constitutional prohibition of "gifts" to private concerns or it is not.
If Goldwater was certain about its case against Glendale, that would be one thing.
But its very inaction declares its uncertainty. The only "certainty" here is that Glendale taxpayers will shell out even more. The Goldwater Institute should do the right thing by those taxpayers and step aside.
PS from Ducky - Jimi I sent you a pm on this. This is an official editorial board editorial not a blog.