The Arizona Coyotes and the City of Glendale may have arrived at a settlement to their ongoing dispute over the status of the Gila River Arena lease agreement. The City Council is set to meet Friday morning to vote on potential changes to the lease structure. Here are some of the details, courtesy of Coyotes insider Craig Morgan:
If Council approves amendments, city & team will reach settlement that will keep Coyotes at Gila River Arena for at least next 2 seasons.— Craig Morgan (@craigsmorgan) July 23, 2015
Per terms of deal, Coyotes would collect all hockey-related revenue that previously went to COG (naming rights, tix surcharges, parking rev)— Craig Morgan (@craigsmorgan) July 23, 2015
City would pay $6.5M a year to Coyotes to manage arena. Out-clause that was part of the original 15-year, $225M agreement would be removed.— Craig Morgan (@craigsmorgan) July 23, 2015
Obviously we will learn more as details become available, but on first glance, this looks like a pretty darn good deal for Glendale. Glendale reduces its annual payment to IceArizona by $8.5 million, though the actual savings are less than that thanks to the loss of revenue streams.
Though the out-clause is gone, the fact that the lease only lasts for two seasons will undoubtedly inject more uncertainty into the team's long-term future in Glendale. The decision by potential NHL suitors in Seattle to not apply for an expansion franchise will do nothing to curb relocation speculation.
On the more optimistic side, the fact that the Coyotes are willing to accept such a dramatic reduction in the arena management fee suggests that the team's financial situation is much better than it was a few years ago. And if both sides are satisfied with the resolution, there's no reason to believe the City Council could not just extend the revised agreement further.
But this settlement - should it be approved - would resolve one major legal point of contention between the City and the team. And ultimately, the best chance for long-term success in Glendale relies on both parties being satisfied with the arena situation. This settlement would go a long way to making that outcome a reality.
UPDATE (10:25 AM)
The City of Glendale has provided the relevant documents in advance of tomorrow morning's meeting. We will host them here for your viewing pleasure.
Amendments to Gila River Arena Lease Agreement Final Settlement Agreement