Have We Hit Rock Bottom Yet?

Having seen the loss of an NHL team once in my life, there are some key checkpoints that one looks for when it comes to desperation over saving a team. When all the marketing ideas have run, one of the things a team will do is collectively ask its fans to come out en masse to convince politicians and investors that there is a market for hockey in whatever city is holding the rally. Rallies, for the most part, do little to sway anyone's thinking as fans in Winnipeg, Hartford, Atlanta, and Quebec City will tell you. In saying this, I found it quite puzzling that the Arizona Coyotes are now calling for their fans to contact the City of Tempe in their effort to get an NHL-sized rink in the Arizona community.

The website linked above makes all sorts of claims that are, at best, laughable in their sincerity, but let me clear in saying that flooding the City of Tempe's Procurement Administrator's inbox with demands for an arena in Tempe literally is the wrong way to go about this endeavour. The last thing Michael Greene wants to see when he's trying to do is job is a thousand emails riddled with spelling mistakes or assumptions about the arena proposal, and I can certainly guarantee you that, if you sent the stupid blurb that the website told you to send, I'd be deleting every single one.

This is simply another ploy by billionaires to put pressure on the people who are supposed to look out for Tempe's best interests, so let's cut through the crap of the statements made on the "Get Involved" website by addressing each statement's falsities.

1. "The Coyotes will be the first-ever privately financed arena in Arizona".

This statement is only partly true as the "city sales tax revenues to help pay for $200 million in additional costs, including infrastructure work" as per this article by The Associated Press. While the building and the surrounding commercial properties would be funded by the Arizona Coyotes' owners, most notably by Alex Meruelo, the infrastructure to support the arena will cost people in and around Tempe a hefty price tag through sales taxes.

Let me put it to you this way: that's $200 million either raised by new or increased sales taxes or it's $200 million diverted from projects currently funded by the sales tax revenues. Are you willing to see streets and schools and sewers receive less funding for repairs and upgrades in order for the Coyotes to have more streets and sewers in and around their proposed development?

Ask Calgary about infrastructure costs and how they derailed their new arena project. These aren't fixed costs as the materials to build these new infrastructure pieces constantly change. $200 million might be just an estimate, and the price tag could be much, much higher as the Flames and the City of Calgary found out.

"They are very much just a money pit for taxpayers," Pat Garofalo, director state and public policy for the American Economic Liberties Project, a non-profit group that frequently analyzes public subsidy deals while advocating for greater corporate accountability, told Investigative Post about new arenas and stadiums.

2. "The project will bring 6,900 new permanent jobs to Tempe".

This is beyond false in its sincerity, and I cannot stress that there will be very few permanent jobs created in any way for people in Tempe.

"The big ripple effect issue is that you don't have continuous employment except for security guards and groundskeepers," Greg LeRoy, executive director of Good Jobs First, a national subsidy watchdog group, told Investigative Post.

He's not wrong in his assessment as most of the jobs currently held by employees of the Coyotes won't change or be opened up with a move to Tempe from Glendale, and the vast majority of new jobs seen will only require gameday and part-time staffing. If you're going to include the commercial properties around the proposed arena, the return on investment may never be realized.

"A lot of people think you can build a $250 million arena and watch everything turn from a cesspool to rose water," Steve Hyman, general manager of The Mark of the Quad Cities in Moline, Illinois, told the Sports Business Journal. "But if you do nothing but wait for the ripples of that cesspool to reach the shoreline, it will never happen. You have to push, pull, punch and squeeze to make it work. You have got to have serious private players."

If you think the Coyotes are going to be out lobbying for businesses to move in next to them, there's a reason why they've lost money nearly every year since moving to the desert.

3. "This project will finally clean up an old landfill – 1.5 million tons of trash".

Again, this is only partly true in its sincerity, and I really caution everyone reading this article that the Coyotes are opening a can of worms that will only end up costing millions of dollars to fix. Henry Greenstein's August 2021 article in the Phoenix Business Journal tabbed the remediation costs of the proposed arena location to already be $70 million as of June 2021. As you know, it's now June 2022 and the price of everything has gone up.

As I wrote in my article about Calgary's remediation costs using the Tempe information, "[t]here are all sorts of environmental issues that can arise from digging up landfill items" and I cited Tim Kellison from the Phoenix Business Journal who stated, "What tends to occur is an underestimation of just how badly the land is contaminated, and as a result, how much it will cost to actually do a good job cleaning up the site in a way that conforms with numerous environmental regulations."

Kellison used Tropicana Field's remediation costs in Tampa-St. Petersburg as an example where the costs tripled from the original estimate. If that $70 million price tag triples - and it almost certainly will be more than the estimate - and the Coyotes aren't willing to cover it, you know who they're coming to for money, right? With $200 million already on the books for infrastructure upgrades, how much more can the Coyotes squeeze out of the City of Tempe and its citizens?

4. "Nearly 2 billion dollars of private investment to Tempe".

This is entirely true, but it's written deceptively. Because the cost of the arena project is already tabbed at $1.7 billion, that's conicidentally "[n]early 2 billion dollars of private investment" already committed to Tempe. See the problem?

But let's take this figure one step further with a line from the Investigative Post article about Buffalo's new NFL stadium that reads, "[S]pending upwards of $1 billion on a new NFL stadium will result in more revenue for the league and team, and an increase of the franchise value for the Pegulas."

It's private money being invested, so who do you think will benefit from the new arena the most? Hint: not the people or the City of Tempe. All this new arena does is make the Coyotes more expensive when Alex Meruelo wants to sell the franchise to some other mindless investor desperate for a sports franchise in his portfolio. This "[n]early 2 billion dollars of private investment" serves no public interest for the City of Tempe in any way, shape, or form.

5. "NO taxpayer dollars are at risk".

This is a flat-out lie. The costs of the infrastructure upgrades around the arena project are already taxpayer-funded, and those costs will only increase as infrastructure costs go up and the project evolves. Beyond that, there's another major issue that should be addressed before a private business such as the Coyotes start making ludicrous claims like the one above.

Henry Taylor, director of the University at Buffalo's Center for Urban Studies, told the Investigative Post that "he finds it interesting that some of the same public officials who shy away from borrowing money or raising taxes to tackle problems like poverty appear eager to do so to benefit a professional sports franchise" while Henry LeRoy told the Investigative Post, "There are obviously so many other better things Buffalo could do with that much money."

Stating that there are no taxpayer dollars at risk is not only a lie, but it's also entirely deceptive in that the proposed taxes to pay for the Coyotes' arena project would actually have a greater benefit to Tempe if they were used to tackle things like infrastructure, education, and poverty.

If we need evidence of this, the Investigative Post makes it clear, stating, "From a return-on-investment standpoint, economists and researchers almost universally agree that stadiums are unlikely to generate anywhere near the level of tax revenue needed to offset the public subsidies tied to their construction". But there's no risk for taxpayer dollars, right?

6. "This project is an economic generator of $215 million of net new taxes for Tempe over the next 30 years".

This is simply more rhetoric to mask and deceive. As shown in the Sportsnet article, Tempe citizens will be shelling out $200 million in new or increased sales taxes to cover additional costs as dictated by the arena proposal. If the figure stated by the Coyotes was even remotely true, that means that the City of Tempe generated $500,000 per year in net new taxes since the $200 million "investment" in the infrastructure around the arena project only benefits the arena project. For $15 million net new tax dollars ($215M minus $200M) earned over 30 years, is that really an investment you want to make if you live in Tempe?

Let me repeat from the Investigative Post article, "From a return-on-investment standpoint, economists and researchers almost universally agree that stadiums are unlikely to generate anywhere near the level of tax revenue needed to offset the public subsidies tied to their construction."

As Andrew Zimbalist and Roger G. Noll wrote in a Brookings article,

"In every case, the conclusions are the same. A new sports facility has an extremely small (perhaps even negative) effect on overall economic activity and employment. No recent facility appears to have earned anything approaching a reasonable return on investment. No recent facility has been self-financing in terms of its impact on net tax revenues. Regardless of whether the unit of analysis is a local neighborhood, a city, or an entire metropolitan area, the economic benefits of sports facilities are de minimus."

In other words, the Coyotes are lying to your face.

7. "Coyotes are incorporating inclusive areas for people with varying abilities".

Yay for the Coyotes being able to read the 2010 ADA Standards for Accessible Design? By law, The Americans with Disabilities Act of 1990 made it a requirement that all facilities being built have to be accessible for all people, and all building permits received by a state, county, or local government must adhere to the law.

Congratulations, Coyotes, you know how to read. I guess this counts as true?

8. "Sport brings people together, building community bonds and local pride".

There's the old "civic pride" argument by the Coyotes. You can certainly be proud of the Coyotes and cheer for the Coyotes and root for the Coyotes as much as you want, but there is absolutely zero reason for you to absorb the costs that only make a billionaire richer. In no way, shape, or form should Tempe citizens be paying for anything more than tickets, parking, and concessions when it comes to the Coyotes. Anything more is simply a disgusting rich billionaire taking money from your city's coffers.

Quite frankly, I am sick of constantly pushing this narrative that billionaires shouldn't receive one penny of public money, but it needs to be repeated over and over and over again so people don't forget that new arenas do nothing for their communities except make a ton of money for the guy who claims ownership of the new arena.

This has been documented time and time again as well. From John Oliver's exposé on HBO's Last Week Tonight to the Investigative Post article, from the Brookings report to articles written by yours truly on HBIC, from Medium's 2017 article to The Conversation's most recent look at the phenomenon, there is a mountain of evidence that public money should never be used for any part of a stadium, tax incentives for building arenas or stadiums always end up costing cities more than they collect, and pressuring city officials with fallacies and false statements as the Coyotes have written on their "Get Involved" website just make everyone look incompetent.

I hate to say it, Tempe citizens, but your potential new neighbours are already asking you to lie to the City of Tempe's Procurement Administrator with their inane reasons listed above, and that seems to be pretty unneighbourly when it comes to being good neighbours. You can watch the proceedings of the City Council hearing where the Coyotes will present their project via this link on Thursday at 2pm MT, but I would sincerely ask that you email your city councillor and insist that taxpayer money not be used in any way, shape, or form for this new arena.

Begging is a new low for the Coyotes, but Daniel von Bargen's line from Super Troopers may sum up this entire decade-long Arizona debacle known as the Coyotes quite succinctly in its brevity.

Until next time, keep your sticks on the ice!