Tempe’s bean counters and their harsh truth

By
Updated: August 1, 2016

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The mid-west beer moguls are just too much for Tempe’s modest ownership group.

By Jason Perez, The Tempe Times

Having now burned their bridge with the city of Tempe and KSM, who manage Tempe’s baseball facility, owner Chris van Hauten went “all in” with negotiations wih HeliBrew owner Klyde von Rusk over the past few weeks. They saw it as their only hope for the team to survive.

This could be true, as the situation in Tempe would leave the team to fend for themselves with a string of unfavorable home games. The days of generous Saturday night games under the desert nights were gone. Tempe Knights games were now relegated to mid-week meets with nowhere near the fanfare and attendance, according to the club. “No matter how you slice it, we couldn’t find a way to at least maintain attendance under the new agreement with Tempe Heat F.C. coming in” said VP of Baseball Operations Ted Flynn, “we were already in a tiny baseball market, we couldn’t possibly agree to make our lives even more difficult by limiting our options”, he added.

A small bright light seemed to arrive in mid-November when a new PEBA-wide media rights deal emerged, pumping as much as 40-50 million dollars into teams’ revenues. This could have been a great help to the Knights. Over the next few days, it was rumored that team officials called an emergency meeting to look into the financial ramifications of the deal with their accountants.

Unfortunately, The Tempe Times were not able to get a comment from anyone directly related with the team, so last week we visited Knox and Knox, one of the area’s largest accounting firms, to see if they would give us some insight on the financial landscape that the team was dealing with.

According to Jason Lester, the new deal is a bit of a mirage: “The media rights deal puts them on equal footing with all other teams in PEBA from that revenue stream, so it closes the gap, but they are still lagging behind other teams in every other measure” he said. “Since everyone proportionately improves, they don’t actually become more competitive, the gap just closes slightly, but part of that would also lag behind again with their situation in Tempe. So, if anything, they would still be the team that is worst off in PEBA.”

To the ownership group’s collective horror, a second PEBA team has been playing the bidding war to relocate to Madison. If it was a one-horse race, they could have negotiated something modest… but instead, they were out-muscled and were strong-armed out of options. The team simply didn’t have the finances in place to use their new facility. The second team, which HeliBrew refused to name, had simply brought more cash to the table.

So, just a few days ago, the management of the battered Knights, now without long-time GM Rory Collins who had recently resigned, went to the league to discuss their options. Those options were few and far between. They were told that unless they found a suitable location to play, that they would be staring down the barrel of being contracted.

This leads to this morning’s press release, from Knights owner Chris van Hauten:

“Good morning everyone.
I, along with all Tempe Knights management and staff, would like to thank everyone for their amazing support over the past 17 seasons. We spent much of that time as PEBA’s ‘little guy’, battling the goliaths. In 2012, we even conquered the whole mountain. However, over the years, that mountain kept getting steeper and steeper. Turning a profit while returning to a level of play which was expected from us, as well as players and you the fans, became incresingly difficult. As this great league grew, the financial climate became progressively more hostile with time, and these past few weeks’ deveolpnments pushed the team outside a salvagable financial situation.

It is with great pain that we announce the end of the Tempe Knights Baseball Club. We have informed the PEBA’s board of directors of our intentions this morning, and more news will follow as to the fate of certain elements of the organization… mainly the players.

No one can take away the great moments the team had, and I hope you cherish those moments as much as I will.

May the baseball gods smile upon you,

-Chris”
So, it seems like Tempe will now be a soccer town. I guess that still leaves the unanswered question of: who was that second team? Our job at The Tempe Times is done, but news is bound to surface soon.