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Citizens express outrage over Rio Nuevo mismanagement

by on Nov. 29, 2010, under Life, Politics

Most of the 18 citizens who testified tonight expressed outrage over the past Rio Nuevo mismanagement to the new Rio Nuevo Multipurpose Facilities District Board in a public hearing at the Tucson Convention Center’s Greenlee room. Many expressed anger that there has been no accountability for the $230 million spent of tax payer money over a 10 year period, and asked questions about whether a full fledged “forensic” audit could be performed. Several speakers asked for an “accounting” of the spending, to see who signed the “canceled checks” and that research be done on the major contracts which were not performed. Only 2 of the 15 Rio Nuevo projects were completed (the Fox Tucson Theatre and the Presidio wall).

Most of those who spoke tonight:
1. James Kelley (“The Cholla Jumps” blogger)
2. Mikki Niemi
3. Bud Foster, KOLD 13 reporter
4. Ally Miller, Pima County Tea Party Patriot organizer
5. Steve Kozachik (Ward 6 Councilmember)
6. Michael Tony
7. William Beard
8. Sherese Steffens, Pima County Tea Party Patriot organizer
9. Lillian Lopez Grant, neighborhood activist
10. Barney Brenner, candidate for District 3 Pima County Supervisor in 2008
11. Dick Bayse, Pima Assn. of Taxpayers
12. John Kromko, Pima Assn. of Taxpayers
13. Joe Sweeney, recent Republican candidate for CD 7 U. S. House
14. Ken Scoville, historian

Several speakers called for an investigation by the F.B.I. of any criminal behavior, and a state investigation by Attorney General-elect Tom Horne. The Pima County Tea Party has called for such a criminal investigation today (click here). Some speakers did emphasize the need to move forward in developing downtown, despite this negative report.

For Arizona Daily Star reporter Rob O’Dell’s original article on this audit (click here). In yesterday’s Star article O’Dell wrote:

The audit found that the city’s Rio Nuevo downtown redevelopment district was beset by mismanagement and a lack of financial oversight and internal controls that left a majority of its projects incomplete after more than $230 million was spent.

The audit, conducted by Crowe Horwath of Los Angeles for the state auditor general, said much of Rio Nuevo’s money was spent on planning or projects that stalled.

Unfortunately what was revealed tonight was that the recent audit released at the end of October was only a “financial analysis” and not a full audit (financial statement, performance, or forensic). And the Rio Nuevo Board heard tonight from Crowe Horwath representatives that a full forensic audit may cost in the neighborhood of $1 million, since it would span several years.

The Pima County Tea Party Patriots will be holding a protest rally about this “Rio Nuevo Waste” prior to the Tucson City Council meeting on Tuesday December 7, 4:30 p.m. at Mayor/Council chambers, 255 W. Alameda.

Pima Association of Taxpayers is holding a meeting on “Rio Deceivo” at the Woods Library on December 16, 3455 N. 1st Avenue, 6 to 8 p.m.

The Rio Nuevo board has to prepare a “response” in 10-12 days based on tonight’s public hearing for the legislature.

For more: read O’Dell’s article in the Star about this public hearing attended by about 80 people: http://azstarnet.com/news/local/govt-and-politics/article_3a598e2d-e572-5eae-93a6-39b4f3c6d969.html

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  • fraser007

    This is a topic that we can all agree upon. This was such a waste of money. There were so many groups, companies, special interest groups that lined up for a payout or to get funding for their “special” project. Tucson has always had this problem. I know.
    All of the bloggers here need to jump on this. All of them. We have been robbed. Not just the money but the cultural issues. Tucson’s birthplace espically.We lost that….. We didnt need a Rainbow Bridge for example. The U of A is particually responsible.

    • http://www.facebook.com/pages/Three-Sonorans/144198198931412 Three Sonorans

      I’m doing my research on Rio Nuevo… maybe in about a month or so when it starts to make sense I’ll start my investigative reporting on that…
       
      Didn’t know about tonight’s meeting… would have loved to videotape it :)

      • Carolyn Classen

        David, I wondered why you weren’t there and would have liked a videotape of the anger/outrage by the speakers.  But “criminal intent” or “intent to defraud” will be difficult to prove should there be any further investigations. (By the way my husband and I sat in front of Jim Kelley who used to write for Tucsoncitizencom, and he asked about you). Please do some investigative research on this “Rio Nada” as it is called by some taxpayers, and let us know what you discover.

        • Pamela Powers

          I think they just bungled it, and they were in over their heads.  I was asked by Blog for Arizona (years ago) to cover the Rio Nuevo Meetings for them. The meetings were at odd times when no one with a fulltime job could attend, the agendas weren’t published online (or at all), and eventually they stopped having open meetings (or maybe any meetings). The lack of transparency charges are fully justified.
           
          Three things that are never mentioned about the multiple unfinished or on-hold RN projects are: 1) the economy and commercial real estate market tanked in 2008; 2) bankers got stingy with their money; 3) the city appears to be WOEFULLY ignorant about contract law. The city is not responsible for #1 and #2– but #3 they have to own. I have asked multiple people– including Councilman Kozachik– why the city always gets a raw deal on development contracts, and no one has an answer. Who negotiates these contracts? Abie– go for it– I have not found answers to these questions.

    • Carolyn Classen

      True fraser007, and the biggest fiascoes were probably the Rainbow Bridge/science museum spanning the I-10 proposal, and the Aquarium, both of which must have cost millions in design & consulting fees.   Too bad some of the money couldn’t just have been spent on smaller projects like “cleaning up” Congress St. and Broadway Blvd., the major streets through downtown.

      • Pamela Powers

        The Rainbow Bridge is a perfect example of a bad contract. Didn’t they give the UA a maximum price for their project? Usually, when UA researchers write proposals they know the price range they are shooting for. The UA offered a proposal that cost more than the total amount the city had to pay!

        • fraser007

          Bad contract?? Bad idea! There is much to dig into with the former U of A President who pushed for this. Pamela there has to be lots of U of A employees who knew of all of the problems. Ask them.

      • fraser007

        A million % agreed with you.

  • fraser007

    Everybody lined up for the ‘Gravy Train”. Special interests groups, contractors, University of Arizona. Nobody told some of the weird idea people to shut and and sit down. …Rainbow Bridge for example. The museum complex on the west side of the Santa Cruz is another. Those museums have spent millions on plans (from out of state design firms) with nothing to show for it. ASnd then there is the trolley!
    Changing designs and priorities killed this project as well as local contractors who lined up for the hand outs.
    The history realted projects were worthy. The City and locals are still working on the Tucson Birthplace site. At least the Presidio got done. And thats about the only successful project.
    We almost deserve what we got. We are so dumb we need to be shot.

    • fraser007

      I would hope that the blogsters here would attack the Rio Nuevo and all that it caused of wasted money. But I see a problem. Most of the bloggers here are liberals and the democratic City Council will get hit hard on this as they were the ones who oversaw the project. So the next election will be interesting. Lets see just how much guts the bloggers have for this outrage or will they cover for their democratic friends on the Council. Time will tell.

  • http://TheWorkingCircle.com Dr. Diane Katz

    When I moved here in 1995, I heard that Rio Nuevo would cure the blight of downtown. I am still waiting. I hope there is nothing illegal, but at the very least, there is mismanagement, inadequate oversight, and lack of intelligence.
    I sat at a talk by a builder, architect, and a representative from the U of A who spoke of the development that would be housing and shopping for academics. What shocked me was there was NO talk of making the development in any way sustainable. Tucson is bleeding, in part due to inadequate planning and oversight.

  • Carolyn Classen

    You may be right Diane, that this may have been all mismanagement and lack of adequate oversight and common sense.  I remember the Rio Nuevo committee always proposing some grandiose plan (s), spending lots of $ on it, then having it shot down & fail — over & over.  Yes, the City of Tucson and this Rio Nuevo entity need a lot of help, as evidenced by that recent “audit.”

  • Harvey

    What does the City have against hiring professionals to work for them?  I understand the first “Treasurers” for Rio Nuevo were the City Finance Directors Kay Gray and her successor Scott Douthitt.  That’s trouble from the start – two uncertified brown nosers – no wonder Rio Nuevo’s books were screwed up from the get-go.
     
     

    • Carolyn Classen

      No idea Harvey, but that’s part of the likely mismanagement of this Rio Nuevo mess, not to hire competent individuals.  I don’t remember either of those names you mentioned, but I heard them mentioned by Joe Sweeney last night, you did “name names” of those he thought were responsible/culpable.  One of the board members asked if a CPA was required for that job and the response (I believe) was 50/50 part of the time.

    • mapwife

      I thought Greg Shelko was supposed to be a professional.  They even rehired him for his knowlege and expertise.  

      Even the professionals can run things into the ground.  Maybe he should be the one a criminal probe should focus on and the people who hired him and re-hired him. 

  • Carolyn Classen
  • Carolyn Classen

    Ally Miller, Teapartier just sent me list of who is their General Counsel and on the Rio Nuevo Board:CONTACT:Keri Silvyn, Esq. ,General Counsel to the Rio Nuevo DistrictLewis and Roca LLP One South Church Avenue, Suite 700Tucson, Arizona 85701Phone: (520) 622-2090/ MemberRoleAppointor–Ms. Jodi BainChairpersonPresident of the Senate/Mr. Dan CavanaghMemberGovernor/Mr. Jeff DiGregorioMemberMayor and Council/Mr. Scott EganMemberSpeaker of the House (Egan has resigned)/Ms. Carlotta FloresMemberGovernor/Mr. Rick GrinnellMemberPresident of the Senate/Mr. Mark IrvinVice ChairpersonSpeaker of the House/Mr. David JonesMemberGovernor/Mr. Alberto MooreSecretaryGovernor/Ms. Anne RussellMemberMayor and Council/Mr. Victor (Roman) SolteroMemberCity of South Tucson 

  • myperspective

    I was with the Westside Coalition back in the late 90s when we authored the vision papers for Rio Nuevo. It was about historic preservation, human scale development in keeping with the vernacular, local employment, no national chains and more in the same vein. It was finally presented to the voters in 1995 for the TIF (tax incremental funding) which was overwhelmingly approved.
    One of the first steps was the city selling the historic Putsch Bldg and the old Thrifty store on Congress St. for $100 to Don Bourne. He was given $750,000  for demolition. There have been conflicting figures but I was at the commission meeting and saw the actual figure on the agenda. Karen Thoreson was asst. city manager at the time. It was clearly a back room deal and it became clear out efforts to save the former was doomed from the beginning. It was razed within days to avoid a possible injunction and we all know what we now have to show for it. All this in the name of historic preservation. In fact we would never have known about it were it not for an alert Az Star reporter who brought it into light.
    When a much later article appeared saying there was no vision I wrote a letter to the editor countering that notion. It was never published.
    Once the consultants became involved the vision somehow got lost in the shuffle and it turned into a feeding frenzy. We were offered all sorts of ambition projects short of the Hanging Gardens of Babylon.
    One fine project we do have, however, is the Mercado Market and homes west of I-10. In a conversation with Justin Nixon who developed it, he told me he saw the original papers and used it as a guide. He received nothing from the city but the infrastructure to access the homes. It actually has become a interactive community. The Mercado which in completion stages has been used for a number of occasions including weddings.

  • myperspective

    All this and Josh Brodesky’s recent article on downtown accountability to me is like having salt poured on open wounds.
    If I may indulge, in 1995 during a local drain project contracted by the city, the foundation of my 1920 brick house was severaly damaged by heavy equipment going back and forth for over a year. It actually felt like and earthquake when I was inside. I lived in LA and know what one feels like. After roughly a four year struggle I was only left with the short end of the stick.
    The city seems to be very free when it comes to throwing around millions to wealthy developers helping them become more wealthy with little or nothing in return.
    However, when it comes to liability for ordinary tax paying homeowners it’s almost impossible to get a dime from of The City of Tucson. Even now new cracks continue to appear.

    • Carolyn Classen

      Sorry to hear about your house “myperspective”.  I guess these articles do sound like “salt on open wounds”, but that is life in the City of Tucson unfortunately.

  • Carolyn Classen

    About 20 Tea Party patiots & friends were protesting outside of City Hall tonight, with signs that read” Where is the $?”, “We want accountability for Rio Nuevo debacle”, “We want a refund”.  Former legislator John Kromko and former Pima County Supervisor candidate Barney Brenner were in the crowd, and will likely testify at the City Council meeting hereafter.

  • Carolyn Classen
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