How did the Arizona Coyotes get here, and what comes next?

On Tuesday, the residents of Tempe all but decided the fate of the Arizona Coyotes franchise.

Presented with a referendum on building a new entertainment complex and state-of-the-art NHL arena on the site of a nearby landfill, residents voted "no." Now, the Coyotes and their fans face a grim reality that is becoming more obvious by the minute: the team’s days in Arizona appear numbered, more so now than ever before.

The Coyotes and the NHL released statements in the immediate aftermath of the vote, calling the decision "terribly disappointing" as both parties turned their attention to options moving forward.

How did we get here?

The Arizona Coyotes have found themselves in and out of financial trouble for nearly two decades, with the team having faced financial hardship in the desert since not long after they relocated from Winnipeg in 1996.

While the team was competitive on the ice during its early years, their arena's small capacity of 16,000, an unfavorable arena lease deal, and franchise struggles during the mid-2000s ultimately began a spiral that would continue until the 2008-09 season.

That year, it became public the franchise was facing enormous losses, and that the team was being buoyed by the NHL. The Coyotes owner at the time, Jerry Moyes, eventually put the team into bankruptcy, with an epic saga ensuing between the Coyotes, the NHL, and former BlackBerry (RIM) Chair and co-CEO Jim Balsillie — which is set to be immortalized on the big screen.

Finally, after years of the league owning the franchise itself, with other efforts to find a new owner crumbling, the NHL eventually found a majority owner in Andrew Barroway, who officially purchased the team during the 2014-15 season. Unfortunately for the Coyotes, who had since moved to Gila River Arena roughly a decade prior, the chaos wouldn’t end there.

In June 2015, Glendale City Council voted to terminate its 15-year lease agreement with the Coyotes. The City and the Coyotes did eventually come to an agreement that saw the club remain at the arena on a year-to-year basis. In August 2021, however, Glendale opted not to renew their agreement beyond the 2021-22 season.

That left the Coyotes without a long-term home and appeared to be the final nail in the team’s coffin, however, just six months later, the club agreed to terms on a three-year lease to play their home games at Arizona State University’s Mullett arena. The deal, widely scrutinized at the time, would see the Coyotes use the site and its cozy 5000-seat capacity as a temporary home until a new building, initially expected to be built in the suburb Tempe, was built.

The Tempe deal’s failure to pass does mean the Coyotes will play out the second year of their deal at Mullett Arena, and it’s also possible they’ll play out the third and final year there as well. As far as long-term prospects go, however, things are looking more grim than they ever have for the NHL’s red-headed stepchild franchise.

Why did the Tempe arena get voted down?

There are several factors as to why the Tempe arena deal was voted down, but by all accounts, a combination of the Coyotes' lack of investment, an aging Tempe demographic, and a tremendous amount of misinformation played major roles in the vote skewing heavily against the deal.

For starters, Daily Faceoff’s Frank Seravalli reported that the Arizona Coyotes dramatically underfunded their campaign relative to their opponents on the Tempe 1st side, with the ‘Yotes spending roughly $250,000 to their opposition's $2-milion. That drastic gap in funding was based on the Coyotes looking for supporters to coalesce into a bootstrap campaign, compared to Tempe 1st’s receiving significant funding from labour unions that hadn’t received a guarantee they would be the ones building the project.

Of course, there are also the usual concerns that frequently come with stadium deals, with taxpayers often finding themselves getting the wrong end of the stick when it comes to footing the bill. In this instance, however, the proposal did reportedly differ in some significant capacities, though it wasn’t enough to ultimately save the deal.

Finally, a significant degree of misinformation also muddied the waters throughout the campaign, only further dividing voter bases and making it difficult to discern truth from fiction surrounding the proposed district.

Is there still hope to keep the team in Arizona?

There’s a pretty significant difference between the team wanting to remain in the Desert and the team actually remaining in the Desert. With their Mullett Arena deal expiring after the 2024-25 season, the Coyotes will need a new home by then at the latest — if not before.

With Tempe down the drain and a strained relationship with Glendale’s Desert Diamond Arena, formerly known as Gila River Arena, the club’s most likely home appears to be sharing a facility with the Phoenix Suns at the Footprint Center in downtown Phoenix.

The original home of the Coyotes, the arena was opened in 1992, a date that would make it the fourth oldest in the entire NHL, though it underwent extensive renovations in 2019.

Those renovations could prove to be somewhat of a hurdle in hosting the Coyotes, however, given that the building is built for NBA Basketball, with obstructed views and limited capacity for an NHL rink. Further renovations are a possibility, per TSN.ca’s Darren Dreger, however, it’s unclear what the appetite for additional renovations less than half a decade later would be.

On Thursday, a report also surfaced that the Coyotes were eyeing the Fiesta Mall site in Mesa, AZ. The premium location is located just off Highway 60 just east of Phoenix and has been vacated since the mall closed in 2018. Per the report, as was the case in Tempe, a vote would be required to build an arena in the area.

What’s next?

There’s little in the way of firm insight into what comes next for Arizona beyond a firm declaration by NHL Deputy Commissioner Bill Daley that the club would play the second of their three-year deal at Mullett Arena next season.

Beyond that, it’s anybody's guess right now as to whether or not the Coyote stay put or flee for greener pastures, though the team appears, at least at the moment, to be hoping to remain in the Desert.

How does the relocation process work?

As one might imagine, relocating an NHL franchise isn’t as easy as snapping your fingers.

A comprehensive article from December 2010 by David Staples of the Edmonton Journal goes in-depth on what the process involves, but at its core, the most substantial hurdle any potential sale or relocation would need to get through is a 3/4 vote by the NHL’s board of governors approving of any move.

As Staples outlines:

According to Section 35.3 of the League By-Laws: “Any proposed sale, assignment or transfer of a membership or of an ownership interest in a Member Club which would also involve the transfer of the Club or franchise to a different city or borough shall also be subject to the provisions of Section 4.2 of the Constitution [requiring a 3/4 vote from the Board of Governors] and to the provisions of By-Law Section 36.” To relocate a team, an owner must submit an application no later than January 1st of the year prior to the year in which the Club will start its first season, unless a majority of Board of Governors (BOGs) consent to a later date.

The BOGs also considers multiple factors when approving a sale, including but not limited to questions of financial viability in the team’s current location, historic support and profitability of the franchise, and if the current owner has made a good faith attempt to find a new local owner to keep the team local.

What are some of the relocation options?

At this point, the two leaders of the pack, should the team opt to relocate outside of the Grand Canyon State, appear to be Salt Lake City, where they would play at Vivint Arena, and Houston, where they would play at the Toyota Center.

Salt Lake City looks to be the early leader, with an NHL arena, demand for a team, and an owner in talks with NHL Commissioner Gary Bettman all factoring into play.

Vivint Arena is certainly on the older side, which complicates matters, and the building does lose some of its capacity hosting NHL games having to collapse in some of its seating, however, a bid for the 2030 Winter Olympic Games could mean new facilities are on the horizon anyway.

Houston, on the other hand, boasts all three of the holy trinity of an interested owner, a viable stadium, and fanbase demand, but ironically appears to be second because of the city's enormous population.

In addition to Sportsnet’s Elliotte Friedman reporting that Houston’s dollar figures came in low for the NHL’s liking, there’s also reason to believe the league could be looking at Houston as a potential expansion team instead. In doing so, the NHL can theoretically extract what figures to be a much larger expansion fee out of the USA’s sixth largest city, rather than moving a damaged goods Coyotes franchise for potentially a fraction of the cost.