Tucson's Rio Nuevo fact sheet given to state lawmakers says $17 million in Rio Nuevo funds has attracted $381 million in private investment Downtown. That's a return on investment of better than 22-to-1.
On closer inspection, however, the city has actually spent $32 million in Rio Nuevo funds when a $15 million city loan to Rio Nuevo is included — not to mention millions of dollars in non-Rio Nuevo funds spent on Downtown revitalization that drew private spending.
Additionally, much of that $381 million in "private" investment includes projects that aren't lead-pipe locks to be built, have tenuous ties to the district or aren't even private funds.
The $381 million in "private" investment includes $5.6 million the city lent the Fox Theatre, $33 million for the Armory Park del Sol housing complex that was in the works before Rio Nuevo was ever put on the ballot in 1999 and six housing projects valued at more than $10 million each that aren't located within the Rio Nuevo boundaries.
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It includes $16 million for a new University of Arizona Science Center that is still on the drawing board and $100 million for the Mercado District, a commercial and residential development at Menlo Park.
Rio Nuevo Director Greg Shelko said the Mercado District is breaking ground for a roughly $30 million first phase of retail development, but he considers the entire $100 million commitment "very real."
He said the developer is building model homes on the property to begin the process of taking deposits on future homes.
"We wouldn't put it on the list if wasn't moving forward," Shelko said of the $381 million. "This is not a wish list of what we think will happen."
City lobbyist Mary Okoye said the list isn't misleading because it identifies the private money as funds spent or committed, not money "funded, done or completed."
City Manager Mike Hein said the city's fact sheet didn't include the $15 million loan to Rio Nuevo because the special tax district is repaying the loan to the city.
As for the $381 million, he said no commitment is ironclad, but added, "I think they are good numbers."
Despite the controversy over the lack of progress since Rio Nuevo was approved in 1999, some said Hein's recent shakeup of the project, cutting two directors and stripping Rio Nuevo of its special status, has created new optimism about Downtown redevelopment.
Rep. Ted Downing, D-Tucson, who opposed a Rio Nuevo extension because it didn't include a public vote, said Hein "found out there were some problems and did what he had to do," adding that "the project should be in his hands."
Richard Oseran, owner of the Hotel Congress, said there is a new day for Rio Nuevo because of Hein and the new City Council, and said he is now optimistic that Rio Nuevo could actually be successful because the city is now working cooperatively with developers.
"We wouldn't put it on the list if wasn't moving forward. This is not a wish list of what we think will happen."
Greg Shelko
Rio Nuevo director, on the $381 million in private investment Downtown
