Hey there, time traveller!
This article was published 3/3/2011 (2108 days ago), so information in it may no longer be current.
The Goldwater Institute is ready to rumble.
Darcy Olsen, Goldwater's CEO, said if the newspaper hoped it would promise to back off from its threats to sue the City of Glendale over the proposed deal to issue bonds to help finance the purchase of the Phoenix Coyotes by Chicago businessman, Matthew Hulsizer, it has another thing coming.
"I'm sorry to disappoint. Following that advice would be to ignore the Arizona Constitution and give the city of Glendale a free pass to break the law," she wrote.
Olsen said Glendale officials have a history of "crafting deals under the cover of darkness" and its plan to raise $116 million through the bond market to back Hulsizer is no exception.
Goldwater contends the plan, which calls for the city to repay the debt with parking revenue from Coyotes' games, contravenes the gift clause in the Arizona Constitution that forbids using taxpayer money to fund private businesses.
She said one of its reports earlier this week found that TL Hocking, a financial consultant brought in by Glendale to back up its claims, has been accused in a federal lawsuit of inflating revenue estimates in reports used to secure funding to build a city-subsidized arena in Prescott Valley, several hours away.
She said that arena has never met those estimates and the bonds that financed it have been downgraded to junk status, according to the lawsuit.
"TL Hocking's estimates are critical for Glendale's claim that it can repay $116 million in bonds with new parking fees at its arena instead of using city tax money," she wrote.
Olsen noted Goldwater isn't alone. Moody's, the New York-based credit rating agency, said recently that Glendale's mounting debt is triple the national median for cities of its size. It also downgraded the city's debt when it heard of the bond issue.
"I suppose Moody's should back off, too," Olsen wrote.
She said Goldwater's preliminary analysis suggests the parking fees at Jobing.com, the home of the Coyotes, will not be sufficient to repay the debt.
"The Goldwater Institute has enforced Arizona's public-records law and brought sorely needed transparency to Glendale city government. We hope the city will do the right thing and avoid a lengthy and protracted lawsuit by coming into compliance with the law," she wrote.