Tempe preps for possible public vote on hockey arena project

A proposed $2.1 billion development that includes an arena for the National Hockey League's Arizona Coyotes and calls for about $200 million of municipal bonds could be put before Tempe voters next year.

The Tempe City Council, which agreed in June to commence negotiations with the developer, announced Monday it will consider a resolution on Thursday to reserve a spot on the 2023 ballot for the proposed arena and entertainment district in the event it is approved by the council and petition drives are launched and collect enough valid signatures to force a vote by residents.

"If the council passes the resolution, they would be declaring the possibility of holding a special election on May 16, 2023," a statement from the city said. "That action would not indicate city council approval of the overall project."

On Nov. 29, the council plans to vote on a development and disposition agreement that includes commitments between the city and developer, a general plan amendment and a zoning amendment. 

Arizona Coyotes

The project, submitted by Meruelo Group and the team through their affiliate Bluebird Development LLC, was the only response to a request for proposals for a professional sports entertainment district Tempe issued last year for a 46-acre landfill site.

The mostly privately financed project includes a 16,000-seat arena, a practice facility, a theater, hotels, office buildings, housing, and over 300,000 square feet of retail and restaurant space. 

To initiate the site's transformation from a "landfill into a landmark," the proposal called for the creation of a community facilities district that would raise as much as $200 million through the sale of bonds to remove 1.5 million tons of garbage and improve public infrastructure.

The bonds would be paid off by taxes generated onsite by the project and an up to 6% surcharge on all business activity within the district and be secured by a real estate tax assessment lien on the improved property.

The Coyotes currently play in Arizona State University's multi-purpose Mullett Arena in Tempe after the team's year-to-year lease for the Gila River Arena was not renewed last year by the city of Glendale, which financed the facility with $180 million of debt.

The university's 5,000-seat arena is much smaller than other NHL facilities, with the next smallest facility seating more than 10,000 additional fans. The Coyotes hope to have a new building ready for the 2025 season.

In their last season in Glendale, the team drew an average of about 11,600 fans per game.

The team cost the Phoenix suburb tens of millions of dollars and several rating downgrades amid a team bankruptcy filing and multiple changes in the franchise's ownership.