Arizona Coyotes

Rendering of the proposed Arizona Coyotes arena.

The Tempe City Council voted Thursday to begin negotiations with a developer on a new entertainment district, including a new arena for the Arizona Coyotes.

The construction of residential property in the district may lead to legal trouble between Phoenix and Tempe. 

Officials from Sky Harbor Airport say the construction of an apartment complex violates a longtime Intergovernmental Agreement between Tempe and Phoenix.

Sky Harbor’s Chad Makovsky says the airport is not in opposition of the Coyotes moving to Tempe but of the housing, which would be affected by noise from airport operations.

“We continue to invest hundreds of thousands each year in ongoing noise and program management. In return, we asked Tempe to commit to doing one thing in this settlement agreement, the Intergovernmental Agreement,” said Makovsky.

Citizens and airport officials providing public comment Thursday also included pilots and air traffic controllers, some expressing safety concerns relating to the heights of cranes and buildings.

Julio Zamarripa spoke at the meeting, representing the Airline Pilots Association. He says if a plane loses an engine during takeoff in the Arizona summer, crane heights might be a serious issue.

“When you see an airplane taking off under normal circumstances, it clearly clears all the obstacles. However, when you lose an engine, and you're only climbing 200 feet a minute, now obstacles become a concern,” said Zamarripa.

Phoenix officials Thursday said that they may void or litigate on the Intergovernmental Agreement if the plan is approved with residential property.

Tempe Vice Mayor Randy Keating says the council is working to find an agreeable solution for all parties, but he doesn’t believe that this disagreement will determine whether or not the project goes forward.

Coyotes promise community investment in Tempe

During Thursday’s meeting, the team promised an ongoing commitment to community improvement. Keating says the city council won’t forget that promise during negotiations.

“This is a common practice in cities all around the Valley to say, ‘hey, you can build your project, but we're gonna need a, b and c from you.’ So, this is something that I have no doubt that, if a development agreement does come forward, and is approved, it will include a lot of public benefits,” said Keating.

The team has promised beautification efforts like public art, as well as $2 million in funding for the city’s affordable housing project, and additional assistance to Valley Metro to extend the Tempe Streetcar to the district.

“We would love to have the streetcar extended down to our project, and we're willing to make the contribution to do that. We're also going to have our tickets be used for Light Rail,” said Coyotes attorney Nick Wood at Thursday’s meeting.

Tempe showed concern over Coyotes' previous financial issues

Despite agreeing to negotiate with Bluebird Development and the Coyotes, Tempe is worried about the team’s financial track record.

Ahead of Thursday’s meeting, the city gave the plan a 40% score for "financial strength and ability," the lowest of six marks in an evaluation completed by city staffers.

Keating says the developer’s promise of transparency may ease some of the concern.

“What really kind of satisfied me with the Coyotes’ response to that concern, and that’s a very valid concern when you're talking about a $2.1 billion investment, is their willingness to have their books completely open to the city,” said Keating.

The city’s evaluation assessed the project’s design and financial benefit, among other topics. Keating says he has never seen this level of transparency from a developer.

The Coyotes were more than $2 million behind on payments to the city of Glendale last year, and avoided a mid-season eviction by repaying those debts.