Tucson will receive a $63 million grant from the U.S. Department of Transportation to fund the city’s planned streetcar connecting the University of Arizona campus with downtown.

Transportation Secretary Ray LaHood will be in Tucson Thursday morning at the Historic Train Depot to make the formal announcement about the stimulus fund grant, which will be used toward the cost of constructing the four-mile, $150 million project.

“This is a big day for Tucson and a big day for Arizona,” U.S. Rep. Raúl Grijalva said in a prepared statement. “There are few systems like this in the country, and Tucsonans are once again proud to be ahead of the curve.”

Grijalva said with 10 percent of Tucsonans living, working or going to school within walking distance of the streetcar, the investment “will be repaid several times over through increased transportation efficiency, expanded commercial access, pollution reduction and progress on Rio Nuevo. This is exactly the kind of project that shows why the Recovery Act was a vital step in rebuilding the economy.”

Congresswoman Gabrielle Giffords’ spokesman C.J. Karamargin said the congresswoman is pleased with the announcement. “It will bring jobs and economic development at a critical time when we need it most,” he said.

The streetcar would run from near the University Medical Center through downtown to the west side of the Santa Cruz River. The Regional Transportation Plan and tax approved by voters in 2006 included $88 million for it, with another $75 million to come from federal grants. Anything left after construction and equipment is paid for can be used to pay operating costs in the early years.

The city has already received $6 million in federal money for planning and design. It has spent $12.2 million on the project, and plans to spend another $13 million for a Cushing Street bridge to take the streetcar over the Santa Cruz.

City officials hope the streetcar line can be under construction later this year and be operational in 2012.