The audit of the Rio Nuevo downtown redevelopment district released last week provides Tucson and the board that oversees the projects a study in lost opportunity while offering strong common-sense recommendations to make our urban core stronger.
Auditors determined that the financial outlook for the Rio Nuevo Multipurpose Facilities District is good, but that the biggest part of the district’s responsibility — the Tucson Convention Center — has languished for years.
This isn’t a surprise, nor is the conclusion that the district doesn’t have the money necessary to transform the TCC’s meeting halls, arena and performance spaces into a facility that would attract business from out of town.
The Rio Nuevo district is spending $8 million to spiff up the TCC, but the auditors predict it will take $40 million to $100 million for the overhaul needed to attract enough business that would make the effort financially worthwhile.
Fletcher McCusker, who chairs the Rio Nuevo board, said in an interview on Arizona Public Media’s “AZ Illustrated — Metro” Wednesday that members recognize the need — and that money can’t come from the taxing district alone.
“It’s going to take a consortium,” he said. Tucson, Pima County and private developers will have to pool resources and plans if the TCC revamp is to happen. And that, according to the audit, is the linchpin in making downtown Tucson competitive with similar cities like Albuquerque and Spokane, Wash.
Auditors outlined a significant difference between the success of convention centers and arenas in those places and Tucson — hotel rooms.
Because Tucson doesn’t have viable hotel space close to the TCC, most who rent it for conventions, trade shows or community events are local or regional, which means that they come downtown, have their event and then go home. They may eat dinner out before a performance, but not necessarily downtown.
While the Hotel Arizona did operate adjacent to the TCC, it was in decline for years before it finally closed in April 2012. Proposals for new hotels are in the works, and that’s encouraging.
The audit, which is done every three years, is largely complimentary to the current Rio Nuevo board. The district and Tucson have settled their issues over land ownership, and operational and financial responsibility. This is huge. The contentious relationship between the two had long devolved into personal animosity and distrust, to the detriment of the Rio Nuevo projects and the larger community.
Some leftover niggling issues, however, continue to cause problems.
For example, the Rio Nuevo board doesn’t know how many of the roughly 1,100 businesses in the taxing district are filling out their state tax forms correctly. A three-digit code must be included on these businesses’ returns so the state Department of Revenue knows that that tax revenue should be funneled into the coffers for Rio Nuevo. This is how the projects and improvements are funded, but the district, under the current reading of state statute, can’t get that specific information.
Auditors state in the report that, under another guideline, there may be a way to navigate around that speed bump. The district and city should do what is necessary to make certain that the businesses in the district are filling out the paperwork correctly.
McCusker said that doing so “doesn’t change the tax rate, it doesn’t penalize the merchants but will make sure Rio Nuevo gets 100 percent of its allocation.”
The audit emphasizes the need for competent management at TCC and encourages the addition of a private management company — a move that’s already been approved.
Rio Nuevo appears to be on the upswing, at long last. The recommendations in the report, including those outlined above, are worthwhile and should be followed.