Phoenix Coyotes Vote Passes, But Goldwater Institute Ponders Lawsuit Again

Of course, you didn't think this would go away all that easily, did you?

Just as it seemed that the Phoenix Coyotes were out of the dark when it comes to playing in Glendale, Ariz. for the 2011-12 season, that pesky thorn in their side, the Goldwater Institute, says that a lawsuit over the $25 million payment from the City to NHL isn't out of the question.

GWI's Nick Dranias said that his organization still needs to do their homework on the issue, but he certainly didn't rule out the possibility of a lawsuit, questioning whether or not the payment is a subsidy to the NHL.

"The Arizona constitution clearly bans subsidies to private businesses," Dranias said on Phoenix's 12 News Tuesday afternoon. "The founding fathers saw that bailouts are a bad idea and they are illegal in this state"

Glendale mayor Elaine Scruggs argued at Tuesday night's city meeting, at which Council members voted 5-2 to fork over that $25 million to the NHL, that it's not a subsidy. Her argument was that it's an investment in the arena in and the area, because without the team, Glendale is stuck with a vacant, city-owned arena that will cost them much more than the $25 million.

"If that's true, they ought to be able to break down where those expenses are going. Are they going to preserve the team's operations -- for the Zamboni, for the ice rink, for the jumbotron? Or are those things for the lights and the heat and the air? The bottom line here is that if that payment is going to expenses that exist only because the team is there, it's a subsidy."

Dranias went on to say that his group is "absolutely" looking at the possibility of a lawsuit if they determine that the $25 million payment (and a separate payment of equal value to cover last season's losses) is a subsidy to the Coyotes and the NHL.

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