Tempe council gets its first look at Arizona Coyotes arena proposal

Tempe council gets its first look at Arizona Coyotes arena proposal

The Tempe City Council will meet in a closed-door session Thursday for its first look at the Arizona Coyotes’ proposal to build an arena just west of Tempe Town Lake.

The meeting comes seven months after the National Hockey League franchise submitted its proposal to the city.

Coyotes owner Alex Meruelo envisions a $ 1.7 billion entertainment district that would include a hockey arena, hotels, apartments, restaurants and shops on 46 acres of city-owned land on the south bank of the dry Salt River, near Rio Salado Parkway and Priest Drive.

The council is expected to hear from team officials, as well as the city attorney and staffers who have been evaluating the proposal since September.

State law allows city leaders to meet in closed-door executive sessions for legal advice and as they negotiate the sale or lease of land. A council vote on the deal would have to happen during an open meeting. Mayor Corey Woods has said he expects that to occur before July, when two new council members will be seated.

Timing is important for the Coyotes, who will play their last game at Gila River Arena in Glendale on April 29. Glendale officials announced last year that they wouldn’t renew the team’s lease as they looked to take the city-owned arena in a different direction. The announcement came about a month after learning the team was eyeing a new arena 25 miles away in Tempe.

As the Coyotes try to close on the Tempe deal, the team is expected to play at least the next three seasons at a new multipurpose arena at Arizona State University in Tempe. The interim arena is about one-third the size of Glendale’s and it isn’t expected to be ready for the NHL team until after the start of the season, meaning the Coyotes would need to play their first games on the road.

Who will pay for it

Coyotes officials laid out their proposal to The Arizona Republic in September, highlighting that the $ 1.7 billion development largely would be financed by private investors.

However, the proposal seeks $ 200 million in city sales tax revenue generated by the development. The tax dollars would go toward infrastructure and remediation of the land that previously was used as a sand and gravel mine and a dump. The site currently houses the city’s public works and compost yard.

The team also seeks a property tax abatement.

Team officials have acknowledged that taxpayers’ do not have an appetite for publicly funded arenas. The proposal is for the team to build and own the arena, which they say would be a first in Arizona, where city and county governments have paid for professional sports venues.

Meruelo, the billionaire who bought the team in 2019, will kick in his own money and is lining up a group of private investors to help fund construction, Coyotes President and CEO Xavier Gutierrez has said.

Team officials have characterized the proposal a transformative development that would turn a former city dumping ground into a landmark they estimate could generate $ 154 million in net new taxes for the city over 30 years, $ 5.9 billion in direct spending in the city and 6,900 permanent jobs.

After Tempe staffers spent months reviewing the proposal, the council now will begin to weigh in.

They are likely to comb through financing and other impacts, such as on air and ground traffic. Officials at nearby Phoenix Sky Harbor International Airport were quick to raise concerns that elements of the project could impact airport operations, although team representatives said they would work with airport officials to address their concerns.

Reach the reporter at rclo@arizonarepublic.com or at 480-267-4703. Follow her on Twitter @renataclo.

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