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6th November
written by JHiggins

Three events surrounding Rio Nuevo downtown redevelopment have occurred in the last month: the Tucson City Council rightly ended plans to build a convention center hotel, the state Auditor General released an audit of Rio Nuevo’s funds, and we did our first Rio Nuevo “Reality Tour.” As each event unfolded, there was an outcry from a portion of the downtown community. The common line in each was: “Let’s turn the page and concentrate on the future.”

In some cases, letting go of yesterday is a healthy step in the healing process. In this case, $230 million is missing with little to show for it. There needs to be an explanation to the individual and business taxpayers of the city and the State of Arizona.

Here are some things that need explanations: Print this story
• Are people who were complicit in the massive failure of Rio Nuevo still in positions of authority?

• How could the city make wholesale transfers of millions of dollars of assets with little more than a footnote in a financial statement?

• When will taxpayers get an explanation about every single dime that was spent?

There are “ghosts” of Rio Nuevo past. Most have departed the city bureaucracy. The cast of characters who deserve  most of the responsibility for the fiasco that is Rio Nuevo include:

City bureaucrats

Former City Manager Mike Hein is back at Pima County working at the pleasure of County Administrator Chuck Huckelberry. There was Hein’s right-hand man and in charge

of the early hotel projects, Jaret Barr. There was the early quarterback Assistant City Manager Karen Thoreson and project manager John Updike. Sprinkle in Greg Shelko — at $100 per hour — and former city managers Luis Gutierrez and Jim Keene, and you have the makings of too many government officials with too little private sector experience controlling a huge checkbook.

Oversight board

The financial audit spelled out the inability of the original four-member city-appointed Rio Nuevo board to manage and control the purse strings. The district was supposed to be autonomous and the board was to act as the gatekeeper of the tax revenues. The original board included former county Supervisor Dan Eckstom, bed-and-breakfast owner Jeff DiGregorio, Anne Marie Russell, director of the Museum of Contemporary Art, and former state Sen. Victor Soltero.

The chosen few

These are the myriad of consultants, engineers and planners who reaped huge fees for designs that were never used on projects that were never built, like commissioning an out-of-state company to make an $820,000 movie to be played in a museum that never got built. There were countless insider developers and campaign donors who were beneficiaries of $1 rents, free land and prime redevelopment tracks because they hired the right consultants or attorneys with the relationships. At least this is changing and the light is being shown on these backroom deals thanks to Councilman Steve Kozachik, investigative reporting and talk radio.

Elected officals

Three of Rio Nuevo’s “superstars” are gone from the City Council: Jose Ibarra, Steve Leal and Nina Trasoff. Councilwoman Shirley Scott and Mayor Bob Walkup still bear responsibility because they’ve been there from the beginning. Walkup, the chief cheerleader for the hotel and light rail, has burned all his political capital and now needs to begin planning his second retirement.

Councilwoman Karin Uhlich added to the fiasco when she pushed for low-income housing projects that have taken an inordinate amount of attention at Rio Nuevo. Scott, Uhlich, Walkup and Councilwoman Regina Romero all were responsible for green lighting an $80 million bond sale at the worst possible time to sell bonds, and for spending it on museum designs, orange griffen statutes, and an over-priced parking garage. They can also take credit for $18 million to plan a hotel that never made sense.

After researching and leading a tour for 40 people a few weeks ago, we came to a realization that the taxpayer was not only robbed by this Rio Nuevo debacle, but punched in the mouth by the city.

The lines between what were Rio Nuevo assets and City of Tucson assets have been so blurred they’ll be hard to untangle. We’ve identified over $44 million that have shifted balance sheets and will probably involve lawsuits to sort out. There is a $14 million parking garage and $30 million spent on the west side.

And just before the state installed a new Rio Nuevo oversight board, the city removed $30 million of assets from Rio Nuevo. Coincidence? 

People who were compliant in the fiasco now must face the consequences.  These are the first steps the city must take to regain the trust of taxpayers and the Legislature.

We’ll be willing to turn the page on Rio Nuevo when the city is open and transparent — two concepts that have been lacking in the project so far.

Contact Joe Higgins and Chris DeSimone at They host “Wake Up Tucson,” 6-8 a.m. weekdays on The Voice KVOI 1030-AM. Their blog is at

Copyright © 2010 Inside Tucson Business


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