Tucson stands to lose up to $4.5 million in federal money for now-defunct Rio Nuevo projects if it doesn't find a new use for the cash pronto.
Tucson has until the end of the week to offer an acceptable alternative plan to use the money, which has been sitting untouched for years, and until the end of the year to contractually obligate the expenditure.
City officials want to put most of the money into building the streetcar line downtown, which would let them take an equal amount of local money out of the construction and shift it to future train operating costs.
The rush to find a new use for the money comes in response to a "use it or lose it" mandate announced by the Obama administration for unspent highway earmarks from fiscal years 2003-06.
The Federal Highway Administration freed up $473 million nationwide and gave it to state transportation departments to use "on any eligible highway, transit, passenger rail or port project" as part of a plan to help create jobs.
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When the new mandate came, Arizona Department of Transportation officials decided the money originally meant for Tucson projects should still be spent on Tucson projects. But the city only has until Dec. 31 to contractually obligate the money.
If the money isn't committed by then, it will get sent to another state that met the deadline.
So state officials told the Pima Association of Governments to come up with a plan by Friday to "use it or lose it."
Because of the tight timeline, the money has to be used for a project that's in progress or ready to go, said John Liosatos, transportation planning director at the Pima Association of Governments.
"We're doing everything we can to utilize every penny that's available to us," he said.
Most of the $4.5 million was earmarked for a science center and "rainbow bridge" project in downtown Tucson related to the Rio Nuevo revitalization effort. But that project never happened.
So instead, the city wants to put it toward the $196.5 million project to build a four-mile streetcar system linking downtown and the University of Arizona.
The city has said the streetcar project is creating 500 construction jobs.
It is being funded mostly by federal transportation grants and Regional Transportation Authority sales tax money.
If the unspent earmark money could be used to offset the city's or the RTA's portion of the construction costs, that would leave more money available to pay for the operation of the finished streetcar line, Liosatos said.
The city also plans to finish an earmarked project on Campbell Avenue. The project had been held up in red tape at ADOT, and ADOT has agreed to move more quickly so the project can meet the strict end-of-the-year deadline, said city traffic engineering administrator Andy McGovern.
Details of the money at stake
Projects for which the city stands to lose federal funding if it doesn't find an alternative use for the money quickly.
Project Allocated Obligated Balance
University of Arizona Science Center Bridge $3,465,000 None $3,465,000
Transportation project at the UA Science Center at Rio Nuevo $491,964 None $491,964
Campbell Avenue Gateway Corridor $491,964 $235,488 $256,476
Tucson Wash Crossings Improvements $99,000 None $99,000
Source: Federal Highway Administration
Contact reporter Becky Pallack at bpallack@azstarnet.com or 573-4346. On Twitter @BeckyPallack.
