For years, planning for the revitalization of downtown and growth at the University of Arizona has included a modern streetcar connecting the two as a key cog - a streetcar officials believed was assured federal funds once the right plans were in place.

But as federal funds have dried up due to the recession and other demands, Tucson is now pinning its hopes on winning a highly competitive federal stimulus grant of $69 million - a grant for which there are seven times as much in requests as there is money. Winners should be announced within weeks.

If the city gets the full amount it requested, combined with $88 million from the Regional Transportation Authority, it can push forward with construction plans that could have pieces of the streetcar line operational by 2012.

However, if the city receives only part of the money, it could be forced to build in phases, perhaps taking on the middle section of the system, from roughly the Tucson Convention Center to the UA's Main Gate.

That would put wheels on the tracks and show progress, but come up short of what voters were told to expect when they approved the RTA, and short of providing the service the city and university were banking on.

City planners are already looking at other funding options if they don't get the full grant. But the likelihood of success and how long it would take are impossible to predict, which could mean a long delay for the other two legs, from downtown to the west side of the Santa Cruz River and from the Main Gate northeast through campus.

If the city is rejected completely - which city leaders dismiss as a possibility - the short- and medium-term future of the project would be on hold. The city would then need to fund the entire project through other means - such as a congressional earmark or the Federal Transit Administration's "small starts" transportation program, from which the city has received limited funding in the past.

"If we get all of it, we'll start immediately," Mayor Bob Walkup said, adding that if the city got part of the money, it would start the project and then try to find the rest elsewhere. "Everybody start praying for the end of next week," he said.

The city and university all in

The city has already spent $12.2 million on the project, including $4.9 million on design for the tracks and $7.3 million for management consulting to oversee the design because the city doesn't have the expertise to handle it. It has not yet begun to buy the trolleys that will run on the tracks.

City officials also intend to spend $14.5 million, taken from the street-repair fund, to build the Cushing Street Bridge over the Santa Cruz, which would push its commitment to the streetcar to nearly $27 million before any track is laid or trolley cars purchased.

Developers from the east end of downtown to the west side have touted the streetcar as the reason they plan to spend millions to try to revitalize downtown.

"It binds downtown together from the university to the west side," said Larry Hecker, a board member for the Tucson Downtown Partnership. "It is the backbone of what the city is trying to accomplish."

In addition, the UA has staked its plans for the coming years on the streetcar coming through campus, thinking students could use it to avoid driving to campus and to travel between downtown and the campus.

The UA is starting to look for private partners to build student apartments downtown, an investment city leaders have long coveted.

"It's kind of fortuitous that our need for growth and our interest in downtown is happening at the same time as this streetcar plan," said Bob Smith, the UA's associate vice president of planning, design and construction.

Without the streetcar, Smith said, the UA would slow its downtown plans.

If city gets less than $69M ...

Walkup said the city would start to move forward with some of the streetcar work and try to find other funding to make up the difference if the city is not successful in getting the full $69 million.

He said there are five or six other sources where the city could apply for money, so if even partial funding from the feds comes through, the city will start construction while looking for the rest of the money, Walkup said.

The February grant, however, is the city's best shot at getting most of the funding it needs to get the streetcar work started, officials say.

City Transportation Director Jim Glock said building between the Main Gate and TCC makes sense if that's all the money the city gets, because it gets the project started and the design of that stretch is further along than the rest anyway.

RTA Executive Director Gary Hayes said the authority will consider releasing its full $88 million to pay for a short line, if it can get assurances the city will come up with money to finish the job.

That's a significant shift for the RTA, which, until now, has been reluctant to release any money until the city had its more than $70 million obligation locked down.

But Hayes said he wouldn't release the money if he thought the city would only build the middle segment and not finish the job. He said the RTA plan calls for the whole streetcar line to be done within 20 years, so if it was phased but then totally complete within 20 years, the RTA would consider that consistent with what voters approved.

"That would put the onus on the city to put together a package to how they are going to fund the rest," Hayes said.

One potential source is the FTA's "new starts" and "small starts" program, from which the city sought money before, without success.

Earlier this month, U.S. Transportation Secretary Ray LaHood rescinded a requirement that made projects meet a "medium" standard of cost-effectiveness to qualify for funding - a standard Tucson's modern streetcar does not meet.

The new rules make it easier to meet the FTA's minimum standard, and allow it to consider the project's potential economic development impact, and its environmental, social and congestion-relief benefits.

Leaders hopeful

City and regional leaders are high on the streetcar's chances, suggesting LaHood or even Vice President Joe Biden could come to Tucson to announce the city is getting the full $69 million for the streetcar.

Hecker and city transportation officials said they heard a rumor Biden called Walkup to tell him that he would come to Tucson to announce the grant. Walkup said Biden never called him to say that. Instead, he talked with Biden's staff when he was in Washington, and they said they would recommend to Biden that he travel to Tucson if the city gets the grant.

Given there were $10 billion to $12 billion worth of requests for the $1.5 billion in grant money, Walkup said he will be "thrilled" with a grant in the $40 million to $50 million range.

Modern streetcar, by the numbers

• Total streetcar cost: $163 million, plus $14.5 million for Cushing Street Bridge

• Total project: $178 million

• Regional Transportation Authority contribution: $88 million

• City contribution (through federal grants): $75 million

• Federal money already received: $6 million

Reporter Becky Pallack contributed to this story. Contact reporter Rob O'Dell at rodell@azstarnet.com or 573-4346.