Via Chris Tozzo comes this gem from Glendale, Az.
Money earmarked for city services such as water and sewer now sits in an escrow account to cover the $25 million pledge that Glendale made to the National Hockey League to keep the Phoenix Coyotes in town next season.
The NHL demanded that Glendale show its proof of funds by Thursday or risk the team leaving Jobing.com Arena immediately. The NHL owns the team, which it purchased for $140 million out of U.S. Bankruptcy Court last fall.
Glendale put themselves into a pickle by making that pledge.
The city agreed to pay the NHL for “actual cash losses” the team and the arena management could start accruing in July.
The agreement states that Glendale is off the hook if it finds a viable owner, approved by the NHL, by Dec. 31.
Any city money paid out of the escrow account would be replenished by the new owner, Lynch said.
But how will the city recoup its money if no new buyer steps up?
Never fear, say the local officials.
“That is not the reality,” said Lynch. “Owners are currently being pursued aggressively.”
And those potential owners know well and good that Glendale officials have put themselves into this bind. Who doesn’t think that the good people of Glendale are going to eat that $25 million in some way, shape, or form?