Field of Schemes new post Glendale faces budget cuts, sales tax hikes to help pay for Coyotes subsidies

If you want a poster child for what can go wrong with stadium and arena deals, you can't do much better than Glendale, Arizona, which nine years after building a new $220 million arena to lure the Phoenix Coyotes to town (and four years after building a new $200 million training facility for the Los Angeles Dodgers and Chicago White Sox) is now faced with a $35 million a year budget hole, service cuts, and a likely sales-tax hike to 10.3%.

Not all of that is due to the sports subsidies, but they're certainly not helping. As the Arizona Republic reports, Glendale has handed over $50 million in direct operating subsidies to the Coyotes over the past two years, part of which has come straight out of the city operating budget, the rest of which will eventually. The proposed new deal with proposed new Coyotes owner Greg Jamison would add $14.5 million a year in annual payments from the city — and that's on top of the $10 million a year Glendale still has to pony up to pay off the original arena construction bonds. Meanwhile, notes the Republic, "The commercial development expected to spring up to generate sales-tax revenue and help pay off the debt never materialized. The city has been using borrowed money to pay the debt, but that will run out in more than a year."

Of course, Glendale could yet be saved from some of these expenses by the Goldwater Institute, which is still threatening a lawsuit over the Jamison subsidy deal once it's finalized. That would probably mean the city losing the Coyotes, but it would get back the $14.5 million a year in operating subsidies, plus (maybe, if you squint hard enough through your rose-colored glasses) have a shot at filling in lost hockey dates at the arena with actual rent-paying concerts. Whether this would end up a net benefit for the city is bound to be the subject of intense courtroom discussion, if somebody finally buys the Coyotes so we can get on with the lawsuit.

from Field of Schemes http://www.fieldofschemes.com/news/archives/2012/05/4967_glendale_faces.html