The Phoenix Coyotes have reportedly lost more than $300 million since the franchise relocated from Winnipeg to the Southwest in 1996. According to some estimates, the team could lose another $40 to $50 million this year. Even in the extremely outside chance that the team were to sell out every remaining home game, the team would still be in the red for the season.↵
Arizona Legislator Floats Futile Phoenix Coyotes Taxpayer Bailout
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↵↵A deal is being formulated to sell the team to Ice Edge Holdings, which would keep the team in Arizona, though the potential ownership group also wants to have a handful of home games set in Saskatchewan. Just in case that falls through, as an added precautionary measure, Republican state representative Jerry Weiers is proposing the establishment of a tax zone around the Coyotes arena, in a effort to offset the franchise’s losses.↵
↵↵⇥The plan, still be formulated, could establish a Tax Increment Financing zone encompassing Jobing.com Arena, where the hockey team plays, and Westgate City Center. TIF zones earmark sales or property tax revenue for development, redevelopment and other projects. There also has been talk of expanding the district to include the proposed Chicago Cubs park in Mesa and downtown sports venues.↵⇥↵⇥Weiers said Legislative staffers are still working on the bill and could not say how tax revenue within the zone would be allocated or who would receive it. Without the tax help, the Coyotes could still end up moving from Arizona, which would devastate the Westgate retail complex and economic activity in western Phoenix suburbs, he said. “It aims to keep them here,” Weiers said.↵⇥
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↵It's an intriguing problem for lawmakers. On one hand, by establishing the tax zone, it could come off as another attempt by local government to coddle a professional sports franchise through continued subsidies. On the other, because these governments consider these franchises such vital means to spurring development and because governments tie so many resources into courting teams and building around their venues, losing a franchise can undo any economic gains made in the areas surrounding the venue.↵
↵↵Obviously, the city is dealing with an unfortunate consequence of having a sports franchise as a centerpiece to long-term growth plans. What’s truly sad is that Phoenix is hardly the only location facing such a dilemma.↵
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This post originally appeared on the Sporting Blog. For more, see The Sporting Blog Archives.
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