The NHL is fighting a war in Phoenix, and however it ends, cleaning up the battleground will be a formidable and expensive task.
Whether this was Jim Balsillie's intention or not, he has exacted a heavy price from the National Hockey League in Phoenix. With the deadline for bidders to declare their interest having passed, there is nothing but scorched earth remaining on Phoenix's hockey landscape.
Someone will end up with the franchise, but there will be no winners here. The legal battle has poisoned the well for a franchise that was once proudly known as the Winnipeg Jets.
Either Balsillie gets awarded the team by the bankruptcy court - after which months of legal wrangling would ensue before his team ever skated onto the ice of Hamilton's Copps Coliseum for an NHL game - or he walks away from the burning wreckage, leaving the NHL with a smouldering pile of rubble down in Glendale, AZ.
No fans, not enough advertisers, likely nonexistent suite sales - if Balsillie can't have the Coyotes, through this process he has ensured they are not worth having by anyone.
Certainly sports magnate Jerry Reinsdorf has decided that this situation is simply too convoluted - and imminently expensive - when he announced Tuesday night that he was walking away from his offer.
The NHL had been hanging its hat on Reinsdorf's bid as a sign that there was interest among bidders who wanted to keep the team in Phoenix. As it turns out our suspicions were well founded. There really is not.
So the league hurriedly constructed a bid of its own when Reinsdorf informed them this week that he was walking. The 29 other clubs will finance the Coyotes, until it can be dispensed in an orderly fashion of the NHL's choosing.
There is precedent, of course. You'll recall that Major League Baseball owned and operated the Montreal Expos for three seasons from 2002-04.
MLB bought the Expos from Jeffrey for $120 million (all figures US), and would eventually relocate the team to Washington. The league recouped $450 million in what was a sale, a relocation fee and an indemnity fee to the nearby Baltimore Orioles all rolled into one.
That model perfectly fits an eventual franchise relocation from Phoenix to Southern Ontario for the NHL. But while Balsillie is looking to spend $212.5 million plus "a reasonable" territorial fee for moving into the Toronto Maple Leafs' and Buffalo Sabres' neighbourhoods, the NHL would prefer to conduct its own sale at its own pace.
Like MLB, the NHL could then put a franchise on the market that has been approved for relocation, with a set of parameters established by the league and its governors, not by a rogue millionaire looking to scoop up a Canadian franchise at a bankruptcy auction.
If the league was selling a Southern Ontario franchise - rather than a flailing Arizona mistake - the sale would be orderly and fecund, worth likely north of $350 million.
There is much ground and many bills to pay, however, between then and now for NHL commissioner Gary Bettman and his 29 owners.
If the Coyotes franchise was losing $30 million a season under Jerry Moyes' relatively stable ownership, it will lose $50 million this season. A virtually non-existent front office has missed out on the past six months, when a sales force should have been selling tickets, suites and advertising deals.
And as Reinsdorf found out, rewriting the arena lease with the City of Glendale is not as easy as many have believed it would be.
| THE COST OF MOVING A FRANCHISE | |||
| YEAR | LEAGUE | FRANCHISE | FEE (IN MILLIONS) |
| 1993 | NHL | Minnesota North Stars to Dallas Stars | none |
| 1995 | NFL | Los Angeles Raiders to Oakland | none |
| 1995 | NFL | Los Angeles Rams to St. Louis | $29 |
| 1995 | NHL | Quebec Nordiques to Colorado Avalanche | none |
| 1996 | NFL | Cleveland Browns to Baltimore Ravens | $29 |
| 1996 | NFL | Houston Oilers to Nashville | $29 |
| 1996 | NHL | Winnipeg Jets to Phoenix Coyotes | none |
| 1997 | NHL | Hartford Whalers to Carolina Hurricanes | none |
| 2001 | NBA | Vancouver Grizzlies to Memphis | $30 |
| 2002 | NBA | Charlotte Hornets to New Orleans | $30 |
| 2005 | MLB | Montreal Expos to Washington Nationals | $450 |
That lease - a tome that is as thick as the Hamilton phone book - was patterned after the arena lease that held fast in Pittsburgh, when Balsillie had attempted to buy the Penguins and haul them north. It has proven a sturdy document that protects the Glendale taxpayers who paid for the arena, under the agreement that an NHL team would be playing in it for years to come.
Last, and surely least, there is Ice Edge Holdings, the third and final bid for the Coyotes from a conglomerate of business people who would keep the team in Phoenix while staging a handful of games in Saskatoon. Again, if the NHL wants its product to be staged in a city outside of its 30-town footprint, the league would prefer not to have that decision made by someone else.
It is about control of your own product, and any league - any business - has to fight to the end to retain that right. You can't put a Home Hardware any place you want - or an A & W, or a Tim Hortons. Nor, the NHL maintains, should you be allowed to buy one of its franchises and plunk it down wherever you want.
The NHL is fighting that war in Phoenix, and however it ends, cleaning up the battleground will be a formidable and expensive task.
Jim Balsillie's persistence has made sure of that.
