Rio Nuevo says it's ready to spend some significant funds on the TCC (though on what they're not exactly sure yet), and is also hopeful of resolving the outstanding lawsuits with the city before year-end:
2008 artist's rendering of proposed $54M remodel of TCC
(courtesy: Tucson Citizen)
TCC likely to get funds from Rio Nuevo
Some of $4.5M in leftover bond funds will be used
by Darren DaRonco
Arizona Daily Star
December 13, 2012
The Tucson Convention Center could receive Rio Nuevo money after all. For years, Rio Nuevo and the city have fought over who should pay for much-needed repairs to the dilapidated TCC. On Wednesday, Rio Nuevo attorney Mark Collins informed the board the Rio Nuevo District was cleared by its bond counsel to spend the remaining approximately $4.5 million from the $80 million 2008 bond sale. While the board could allocate the money to any of the approved bond projects or debt service, Chairman Fletcher McCusker said it's most likely it will be spent on the TCC. "Because of the notice to proceed issue, the only thing we can spend money on is the TCC," McCusker said. McCusker said it's probably better to spend the money sooner rather than later. "It's money. The TCC needs it. Our sense is let's put it to work," he said.
Collins said not all of the $4.5 million would be available to the district. He said some would be obligated to the city and other sources. Since he received the bond counsel's opinion just a few days ago, Collins said he would have to dig a little deeper before he could make any concrete recommendations to the board on how to proceed.
Flood Control
The district board also approved 5-1 a $43,250 drainage study on two properties behind the TCC. Stantec Consulting Services will perform the study. One of the lots is the city-owned parcel where an arena was planned and the other is owned by land investor Allan Norville. "There's some serious drainage issues on both those lots. There's an arroyo that runs through the middle of it that makes it hard to develop," McCusker said. "So what this study will do is tell us how we can route the rainwater runoff around those two lots and make both of them developable."
Tucson City Councilman Steve Kozachik questioned the move, saying unless Rio Nuevo files a notice to proceed on a hotel and convention center, state law only allows Rio Nuevo to spend money on debt service or outstanding obligations. "Spending any money violates the statute until those two things have happened," Kozachik said. "It also seems like they are just provoking the Legislature by doing this and I don't think that's helpful." He also noted that the city has to sign off on Rio Nuevo expenditures, so the board should not act as if a deal is in place until they have it in writing.
McCusker said the district can spend up to $50,000 without city approval and this money doesn't commit the district to any future obligations. By commissioning the study now, it will make it easier to develop that land once an agreement with the city is reached, McCusker said. "The bigger picture is the ability to develop that land. And that can't happen without (the city)," he said. "We'll go ahead and get the engineering work done. But I don't think we would have done that if we weren't optimistic that we would get a settlement here pretty quickly." Rio Nuevo board member Mark Irvin was the sole objector to the deal on the grounds the study should have been competitively bid. "Stantec is a really good firm," Irvin said. But "as a normal course of business, I just like to see at least three bids." Collins said a competitive bid is not mandatory when the award is only a study.
Rio Nuevo and City Negotiations
While the board met in executive session for over an hour Wednesday to discuss a settlement with the city over disputed property ownership and funding issues, it did not vote on its talks. Instead, the board is considering a special meeting Monday to finalize a settlement and discuss publicly what it entails. McCusker said the lack of a vote is an indication of how close the two sides are to resolving their differences. "Because we've converted this to a full settlement agreement, there's much more legal work that needs to be done than if we just signed a term sheet," McCusker said. "A term sheet is just kind of an indication of intent. It's not really binding. "What we have now will be binding agreement on both jurisdictions that we have to approve and the City Council will have to approve." Wednesday was also the deadline for the Rio Nuevo board to decide what to do about its $25 million claim against the city, but that topic wasn't broached because the city pushed that deadline back to the end of the year.