
Tucson, Arizona. The original TIF district was created in 1999, a ten year State sales tax increment financing project expected to generate $60 million (matched equally by local money) to generate $120 million in public money for downtown development projects. City manager James Keene’s "pal" Karen Thoreson became downright giddy with the influx of cash to serve as "seed money" to attract something like a billion dollars in development.
Before seeing a cent of TIF funds, the city paid $600,000 to consultants to create a master plan. Talk spiraled upon talk (cloth) and the projected figures kept escalating. In July 2003 they got the faucet running, and it was a nice faucet quickly reaching $600,000 per month. As an increment over the July 1999 base, each year produced additional revenue to create an estimated $124 M over the ten years, an opportunity for the well meaning, but also one sweet trough for the swine. One might imagine the cloth frenzy that ensued regarding all that was about to occur.
To get the thing "kick started" (don’t ask), they had to spend some money on a key component (don’t ask either) and selected the TCC Box Office. For $800,000 they built it with some signage you can’t see from the road. Before we get into the cloth, let’s acknowledge the purchase and refurbishment of the
Rialto Theater. Dollar figures coming soon, but the Rialto was solid bang for the buck that put the facility on public turf and produced a viable venue that generates multiple events every week and adds to downtown value.
For things Rio Nuevo, we just noted as good as it gets. In fact,
The Rialto Block Project continues.

While spectacular,
The Fox Theater ran $13 million dollars! The city used federal tax credits to LOAN the theater $5.6 million, strapping Executive Director Herb Stratford with massive debt, That’s how you kill an Executive Director, and sure enough, Herb announced his resignation recently. His inferior replacement yet to be announced will probably be another suit already in the mix.
The first TIF phase, "the Thoreson era," consisted of hyper-cloth nonsense of little substance. Remember the Rainbow Bridge? In December of 2005, ConsultEcon (bet that's a productive bunch!) said Rio Nuevo needed a feature on par with the St. Louis Arch or the Guggenheim Museum in Bilbao, Spain (Tucson Citizen, August 2, 2006). We were going to put Cleveland on top of I-10.
The community responded with a noble effort on the part of a group of developers, downtown agencies, and other business interests. They called themselves THE CONGRESS STREET STAKEHOLDERS and met every Friday morning (Tucson Citizen, Teya Vitu, July 18, 2006). The article listed names:
Don Martin, Competitive Engineering
Donovan Durband, Tucson Downtown Alliance
Roger Karber, Hotel Arizona
Doug Biggers and Tom Powers, Rialto block and Depot Plaza
Jim Campbell, Plaza Centro
Richard Oseran, Hotel Congress
Ross Rulney, Julian Drew Building and Tiburon Apartments
Peggy Noonan, Presidio Terrace
Bob Vint, architect for Presidio Terrace and Plaza San Agustin
Evelyn Alvarez, Long Realty
Brian Corbell and Maurice Destouet, Riverpark Inn
Jerry Dixon and Adam Weinstein, Mercado District of Menlo Park
Michael Keith, Franklin Court
Ron Schwabe, 44 Broadway Lofts
Oscar Turner, The Post
April Ortiz, Santa Rita Hotel
Phil Lipman, Ice House Lofts
Steve Farley, trolley and downtown advocate
Diana Rhoades, Sonoran Institute

To pay the $350+ million for the colossus over the freeway, Thoreson sought a 30 year extension of the legislation. One might imagine the enthusiasm in Phoenix. Well, it did get through the House at 12 years but stalled in the Senate. The Stakeholders did agree an extension was required to reach critical mass, and they used their own money to hire a lobbyist. In May 2006 they headed to Phoenix, and asserted that despite the lack of progress so far, Tucson now had a new city manager (Mike Hein) who would get things done. The "Thoreson era" was over. They convinced AZ Senate President Ken Bennett that the "cloth" would not squander the funds on trips to Sweden, consultants in Ohio, or Cleveland on I-10. They would not shut down productive agencies, squash noble efforts, or spend six figure sums to produce glossy documents stating the obvious. In sum, the stakeholders convinced Phoenix that they would insure rationality of the expenditures. Bye bye, bridge. Bye bye, Karen.
The time had come for intelligence to prevail, and it suggested the acceleration of projects that generated economic returns (commercial development). There’s spending money that makes money, and there’s spending money. Well, as above so below. The Bush administration has no interest in what the nation thinks, and our tenth floors have similar dispositions. Don Rumsfeld captured it perfectly, "The president was correct, whatever it was he said."
The tenth floors (add cloth and you more or less have the SG) had little enthusiasm for the intellect of the Friday morning group. Egos didn't help. How does one squash a group? Create another one on top of it and use the word "consolidate." Create the other group to get the contract, public funding, and political support. That’s how the assassination works. Bye bye, stakeholders. Bye bye, transparency.
Looking at TIF reality we see nothing close to a billion dollars. Through FY 2007 (all figures are in millions) we have:
REVENUE:
-TIF Sales Tax Revenue: $41.6
-Bond Proceeds: $5.6
-TCC Games (don’t ask): $24.1
-Other: $2.3
Total Revenue: $73.4
EXPENDITURES:
Overhead/Administration:
-Staff: $3.3
-Consultants: $9.3
-TCC Games (ties to $24.1 revenue save a $3.3 loss, leave it): $27.4
-Other Administration: $1.3
Total Overhead: $41.3
Projects (green means completed):
-
The Fox Theater: $11.6 -Mission Site/Origins Park: $5.6
-Merc/Avenid: $4.2
-
Presidio Stabilization / Heritage Park: $4.1-Citizen Auto Exchange Property: $3.1
-
Rialto Theater: $2.2 -Mission Landfill: $1.6
-
TCC Box Office: $0.79-Northwest Lots-Church/Stone: $0.75
-Civic Plaza: $0.73
-The Post: $0.69
-Civic Parking Garage: $0.66
-Congress Streetscape: $0.34
-Drilltrack Improvements: $0.24
-U of A Science Center: $0.23
-Other Projects: $0.17
Total Projects: $37
TOTAL EXPENDITURES: $78.3
Extracting the TCC, we get revenue of $49.3 M and expenditures of $50.9 M. Of the expenditures, we have $13.9 M in overhead and $37 M in projects. After almost a decade and five years since the faucet started flowing, we have four completed projects.
The Press Headline for November 7, 2006:
2007 WILL BE A BANNER YEAR FOR RIO NUEVO!!We'll get to 2007.