Meruelo, Bettman shed light on steps needed to reactivate Coyotes franchise

Arizona Coyotes owner Alex Meruelo and NHL commissioner Gary Bettman discuss the next steps for reactivating the franchise, including starting work on a new arena and entertainment district on land in Phoenix.

Arizona Coyotes owner Alex Meruelo says he’s “sorry” for how things have unfolded in the desert, calling the decision to sell and relocate the team’s hockey business to Utah “the most painful decision” of his business career.

During a press conference in Arizona less than 24 hours after the NHL officially announced the deal that moves the team from the desert to Salt Lake City under the ownership of Ryan and Ashley Smith, both Meruelo and NHL commissioner Gary Bettman expressed their condolences to fans and players for how things unfolded. They also offered up additional explanations about how and why the arrangement came to be.

Bettman made it clear that the current landscape — even with a successful bid to secure land for a new arena complex — would see at least three to five more years of the team playing out of Arizona State University’s Mullett Arena. That timeline was simply not acceptable. He also emphatically stated the team’s expenses were “greatly exceeding” its revenues, particularly during the team’s two seasons playing out of a rink with a capacity of only 4,600.

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Meruelo has faced intense criticism throughout much of his five-year tenure as Coyotes owner, including allegations of unpaid bills — which he pushed back on during Friday’s press conference. The owner, who expressed his discomfort in and dislike of being in the limelight, stood by his decision to move the team from Glendale to Tempe and said the Coyotes were “never given a fair chance to succeed” over the course of the team’s tumultuous 28-year stay in Arizona. Both men cited last spring’s failed referendum to build an arena complex in Tempe, Ariz., as the greatest disappointment and a major factor in the eventual decision to move the team.

Bettman pushed back on criticism directed at Meruelo’s perceived lack of transparency throughout this process. He said the league first approached Meruelo about this arrangement on March 6, and that the owner’s initial reaction was “no.”

“We then spent the next couple of weeks discussing why I believed it was appropriate for the Coyotes to go ‘inactive,'” explained Bettman.

“We’ve created a scenario here that I don’t think anybody’s ever done before. This franchise is inactive. We didn’t expand — we have 32 active franchises. But it became clear to me — and I proposed this at the outset — that there was no way that Alex was going to agree to this if he wasn’t going to have an opportunity to reactivate the franchise,” Bettman said.

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So, what comes next for the now-inactive Coyotes franchise? The clock is ticking on the NHL-mandated five-year timeline during which Meruelo must build a suitable home worthy of an NHL franchise if he is to relaunch the Coyotes.

Mereulo repeatedly stated his intent to move forward and win the bid for a parcel of land on which he intends to build a new arena complex. He said he will not be seeking public funds for the project. The land auction takes place on June 27. Bettman said the league needs advance notice of 18 months in order to reactivate the franchise — that means we could potentially see the franchise reactivated in less than five years, should Mereulo’s plan to build progress quickly. Mereulo must commit to owning the building for at least five years after it’s built. He is permitted to seek a business partner in this endeavour, but that partner’s share cannot surpass 20 per cent. In terms of hockey operations, Bettman did not go into detail about what reactivation would look like but said it would be similar to the expansion rules followed by Vegas and Seattle. For now, Mereulo is still permitted to attend NHL Board of Governors meetings but cannot vote on any matters.

Throughout Friday’s press conference, both Mereulo and Bettman were persistent in their message that they believe Arizona is a market in which hockey can thrive. Mereulo said he believes that, with the right arena, the franchise can be a top-10 revenue-earning team.

Bettman closed the press conference by quoting American general Douglas MacArthur: “We shall return.”

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