Several day laborers wait to be picked up for work across the street from Southside Presbyterian Church, 317 W. 23rd St.,on an early Monday morning in February.

Ruben Arturo, 21, left his native Honduras seven years ago looking for work in the U.S., slipping across the border illegally into Arizona. But in the past six months work has been so scarce he has packed his bags and is ready to make the trip back home.

Arturo and about 30 other day laborers stand in the parking lot of the Southside Presbyterian Church every morning hoping to be picked up for a day’s work, but recently there have been days when hope is all they get.

Josefina Ahumada, 63, a social worker running the Day Laborers Center at the church, said the men at the street corner, both legal and illegal, “are just like everyone else who is struggling to make it through these hard economic times.”

The number of day workers at that corner has dropped from 60 to less than 40 on any given morning, Ahumada said.

She said in the past year there has been a steady decline of employers coming to the church, which she attributes in part to the slumping economy.

It also can be attributed to the Arizona’s Employer Sanction Law, in effect since Jan. 1, 2008.

The law can punish with fines and possibly the suspension of their business licenses any firms that knowingly hire illegal immigrants.

“It wouldn’t be fair to say one had more impact than the other, because as the law took effect, the economy started falling,” Ahumada said.

Regardless of the reason, many illegal immigrants are leaving the country.

According to a report released two weeks ago by the U.S. Homeland Security Department, the number of illegal immigrants in the country fell for the first time in at least four years.

The decline still left the country with 11.6 million illegal residents in January 2008, down from a record 11.8 million a year earlier, according to a Homeland Security report. There were about 4 million illegal residents in 1990, according to federal agencies and researchers.

Despite the national decline, Arizona’s illegal population apparently grew.

The report said that about 9 percent of Arizona residents – about 560,000 people – are illegal immigrants. While the report did not say how many illegal immigrants lived in Arizona in January 2007, a September DHS report said there were an estimated 530,000 illegal immigrants in Arizona then.

But since fall 2007, Arizona’s economy has declined precipitously.

According to a December report by economist Marshall J. Vest of the University of Arizona, “Arizona’s economy has been contracting since the third quarter of 2007 – a few months before the nation’s economy topped out.”

The state’s latest jobs report bears that out. Phoenix lost 126,700 jobs in the 12 months ending in January – 37,500 in construction and another 25,600 in services.

In Tucson, nonfarm employment fell by 9,700 jobs, compared with numbers from January 2008. Manufacturing declined 3 percent, mining dropped 10 percent and construction jobs fell 25 percent.

Arizona overall has lost 155,400 jobs in the last year, a decline of 5.9 percent. Unemployment in the state rose to 7 percent – up from 4.9 percent a year earlier.

How many illegal immigrants have left the state since January 2008 is not known. The number of day laborers leaving the country can only be estimated because the U.S. Census Bureau tracks people who reside in the country without asking what their legal status is, said Pat Rodriguez, a U.S. Census Bureau partnership specialist.

But despite the dismal times, day laborers desperate for work continue to go to the parking area at Southside Presbyterian.

On a recent February day one of the laborers was waving an orange flag urging potential employers to pull in to the church’s parking lot at the corner of 23rd Street and 10th Avenue.

But trucks kept on driving by. In past years during the construction boom, most the men at the church would have been picked up for work by 8 a.m., a few laborers said.

Some of the day laborers are new to the street corner because they used to have steady jobs but have been laid off.

Others come and go but there are about two dozen men or more standing on the corner every day, Ahumada said.

The Day Laborer Center was started in 2006 by the church to help organize and educate the workers standing on the sidewalks near the area.

The center offers English lessons, a sign-up sheet for when employers need workers, and strict rules prohibiting drug or alcohol use and violence in the church’s parking lot, Ahumada said.

Lindy Sherman, a graduate student at Arizona State University, who is in the Tucson-based social work program, helps organize the day laborers.

“We not only help with the center, we are here to lend an ear to these men and try to keep their spirits up during a time of such desperation for work,” Sherman said.

She said one of the services for the men involves bringing a soccer ball to the parking lot to help keep the men busy and away from drugs and alcohol as they wait for hours, sometimes days, without work.

“During my time spent at the center, I’ve realized how many things we take for granted,” Sherman said. “Especially on days when not one guy gets picked up for a job. It’s really sad to see that.”

As laborers leave the country, Tucson business will be affected by their absence, said Price Fishback, a professor in the University of Arizona’s department of economics.

Their leaving “will definitely have an impact here on anyone selling products or services to immigrants,” he said.

Fishback, a specialist in the history of economics, said immigrant workers, are “pretty good” for the economy because they supply labor and increase a demand for goods.

“When the economy is bad here they leave, and when we need them they come back,” he said. “We’ve seen this happen in the past and it is happening again now.”

But a national immigration think tank believes the illegal immigrants leaving will ultimately be good for the economy and for out-of-work Americans.

Steven Camarota, director of research for the Washington, D.C.-based Center for Immigration Studies, an independent, nonpartisan, nonprofit research organization, said in a report this month that “illegals are primarily employed in construction, building cleaning and maintenance, food preparation, service and processing, transportation and moving occupations, and agriculture. With the exception of agriculture (which accounts for only a small share of illegal workers – less than one in five), the majority of workers in these occupational categories are still native-born Americans.”

“If the United States chose to more vigorously enforce immigration laws over the next year, and this resulted in 1 or 2 million illegal workers deciding to leave, it could significantly improve the employment prospects for less-educated natives. An economic downturn would seem to be the ideal time to step up enforcement because such efforts would be buttressed by the economic situation, and a recession is the time when Americans, especially the poorest and least educated, are most in need of jobs.”

Most of the Tucson day laborers work construction, hospitality and home repair jobs, but “right now it seems as though most of the possible jobs are gone,” Ahumada said.

Arturo, the illegal immigrant from Honduras, said he used to get jobs weekly, but in the past six months all of his jobs combined do not add up to three weeks worth of pay.

“And that’s truly not enough to live,” he said.

That is why, he said, he will soon go back to his hometown in Honduras.

“I don’t know if things will be better back home, but I just can’t be here if I’m not getting work,” he said.

Even though the jobs are becoming less available, not all the workers will follow Arturo’s steps.

Some men come from Central American countries and many regions in Mexico where they face extreme poverty, political prosecution and danger, and “that’s why staying here and waiting for a better tomorrow is sometimes their only choice,” Ahumada said.

For many day laborers, the U.S. is their country of origin as far as they know. She said some of these men have been living in the U.S. for decades and came here when they were young, “so there’s not the option of ‘going home’ for them.”

“I believe there’s a misconception out there that these people are just hanging out in the corner. The reality is that these are people (who) are working in our communities and are part of them.”

To avoid problems, Ahumada said, volunteers have implemented a zero-tolerance policy for violence and alcohol and drug use at the center.

“We want to make sure that people in the area, and police, know our guys and separate them from all those who are committing crimes around here,” she said.

Tucson Police spokesman Sgt. Fabian Pacheco said the center has not been a major source of crime in its neighborhood. He also said that if there are problems in the area, TPD’s policy is not to ask suspects, victims or witnesses their citizenship status.

“We investigate any problems with criminal activity in the area, not whether the people causing the problems are here legally or not.” Pacheco said. “That’s the job of Border Patrol and ICE.”

Vincent Picard, a spokesman for the federal Immigration and Customs Enforcement, said ICE is after employers who are hiring illegal workers, not after those workers standing on the streets. Neither is the Border Patrol,which is mostly concerned with the border and the transportation of illegal immigrants, he said. “ICE conducts targeted enforcement operations. Our agents don’t drive around looking for people who are here illegally,” he said.

When employers knowingly hire illegal day laborers, then ICE would be involved, Picard said, because the employer is the one violating the law.

For some of the day laborers, such as 48-year-old Antonio Garcia, going to the church is a matter of survival.

“We have to survive; I have to provide for my family, and it’s getting tougher by the day,” he said. “All we can do is have faith that there will be more jobs again.”

Garcia has been standing outside the church from 6 a.m. to noon every day since last summer, waiting for more employers to come, he said.

“My wife can’t work, so it’s all up to me to bring food to the table,” he said. “That’s why I’m here every day.”

Almost 400 applicants for clerical jobs in Tucson city government took a skills test Friday despite a dearth of open positions due to a budget crisis.

The test, leading to a list of civil service candidates, is “normal processing,” Human Resources Manager Tameron Collins said.

The city was testing for a variety of entry-level positions that are normally tested for separately, by category, so Friday’s exam represents savings, Collins said.

The list will prepare the city for hiring when positions are available, he said.

“If we wait until we have authorization to fill the position, there will be two or three months where a department is sitting on a vacancy they need to fill,” he said, adding that these jobs see a high turnover.

The test was within the department’s budget, Collins said, but no estimate of the test’s cost was available.

Tucson employment took a 2.5 percent hit in January, according to a report released Thursday by the Department of Economic Security.

That decline, while painful, is much smaller than in Phoenix or the state as a whole.

Nonfarm employment here fell by 9,700 jobs, compared with numbers from January 2008.

Goods-producing companies took the largest hit compared with year-earlier employment numbers. Manufacturing was down 3 percent, mining off 10 percent and construction employment fell a whopping 25 percent.

The sector that showed the greatest increase in employment was government, up 5,900 jobs from January 2008.

Other findings in the report, comparing January 2009 with the same month a year earlier:

• Jobs in trade, which includes retail and transportation, were down 5,200 jobs, or 8.2 percent. Local stores, excluding food and beverage stores, have cut 4,300 jobs in the past year.

•Professional and business services, were down 3,000 jobs, or 5.8 percent, with employment services plunging 27 percent.

• Healthcare created 2,100 jobs, up 5 percent.

• Restaurants and bars lost 1,400 jobs – a 4.9 percent drop.

• Phoenix lost 126,700 jobs in the 12 months ending in January – 37,500 in construction and another 25,600 in employment services. Metro Phoenix employment is down 6.7 percent.

• Arizona overall has lost 155,400 jobs in the last year, a decline of 5.9 percent. Unemployment in the state rose to 7 percent – up from 4.9 percent a year earlier. That still is lower than the national unemployment rate, which stood at 7.6 percent last month.

Unemployment figures for Arizona’s cities were not available.

Bid deadline passes

Husband-and-wife team Anna Marie McGrath and Howard McGrath sell the Citizen on Thursday at South Palo Verde Boulevard and East Ajo Way.

The deadline for bids on the Tucson Citizen has passed – apparently with no offers – which means the paper likely will cease publication March 21 after 138 years in business.

A spokeswoman for the paper’s corporate owner described the Feb. 19 bid deadline as “flexible,” leaving the door open for an 11th-hour purchase.

But national media experts say it is doubtful a buyer will come forward because Gannett Company Inc. is not selling its 50 percent interest in the joint operating agreement it has with the Arizona Daily Star.

The Citizen and the Star, owned by Lee Enterprises Inc., have had a JOA since 1940. Under the agreement, each paper produces independent editorial and news content, while production, distribution, advertising and other non-news operations are handled by a third corporation, Tucson Newspapers. The papers share equally in the profits from Tucson Newspapers operations.

Gannett, which announced Jan. 16 it was putting the Citizen up for sale, appears to be preparing to close the paper.

The company filed an amendment to the JOA with the U.S. Department of Justice on Feb. 13. The department oversees newspaper joint operating agreements created under the Newspaper Preservation Act, which created an exemption to federal antitrust laws for jointly-operated newspapers.

The amendment, signed by representatives of Gannett and Lee, allows the corporations to get out of a requirement in the original JOA that calls for publishing two papers through 2015.

The amendment also strikes all references to the Tucson Citizen from the original documents and contains a provision that anyone who might buy the Citizen before March 21 cannot negotiate to get into the JOA.

However, it allows for Gannett to continue its interest in the JOA, meaning it will continue to receive half the profits from the enterprise, and pay half the costs.

The Justice Department does not have to approve the amendment – which is required to prevent breach of contract. It can decide to investigate or halt the closure, although media experts say that rarely happens.

Mark Fitzgerald, editor-at-large of the newspaper trade publication Editor & Publisher, said the Justice Department has been “fairly laissez faire” about investigating the disengagement of newspaper JOAs.

He said that while some question the legality of selling a JOA-yoked paper without offering the paper’s stake in the agreement, the practice is “very common, especially if you don’t want to find a buyer.”

Gannett’s announcement Jan. 16 said it was selling only “certain assets” of the Citizen, including the paper’s name, Web site, Web address, subscriber list and wire service contracts.

“A (failing) paper is only valuable as it is in the partnership, but as a struggling paper on its own – no one’s going to buy that,” Fitzgerald said.

When the federal governments approved the JOA in 1970, each paper had a daily circulation of 60,000.

But the morning Star now has a daily circulation of about 94,055 and the afternoon Citizen’s has fallen to 17,000.

Robert J. Dickey, president of Gannett’s Community Publishing division, said Jan. 16 that the reason for selling the Citizen was because it was no longer profitable. He did not go into details when delivering the news to Citizen staffers.

Tucson Newspapers CEO Mike Jameson described the Citizen as “upside down” in regard to revenues and expenses.

“It costs (Tucson Newspapers) more to operate the afternoon newspaper than the newspaper contributes in revenue to the organization,” he said. “If you remove it, you have less revenue, but you also have less expense and in this case the expense is more than the revenue.”

Profits from Tucson Newspapers operations plunged from 2007 to 2008, according to annual reports from Lee Enterprises for those years.

In 2007, total profit for the JOA was $36.5 million, resulting in a profit split for the Citizen and the Star of $18.2 million each.

Total profit for the joint venture in 2008 was about $21 million, so each parent company got only $10.5 million.

“This is an unprecedented economic downturn,” Jameson said, explaining the profit slide. “Our top categories of advertising revenue, from department stores to auto to real estate – all of those have been hit particularly hard. It’s a very serious situation, so I’m fairly confident (selling the Citizen) wasn’t a decision that was made lightly because, you know, the Citizen’s been around a long time.”

Antitrust lawyers at the Department of Justice did not return repeated calls for comment on the Citizen-Star agreement, but James R. Wade, the former chief of the Litigation III section of the Department of Justice Antitrust Division, reviewed the Citizen-Star JOA for this article.

Wade said there is “a big question” surrounding selling newspapers currently in JOAs without including their vested interest in those agreements.

“It leads some people to say that by selling it that way, they are essentially guaranteeing that no viable buyer will emerge,” said Wade, now a partner in the Washington D.C. office of Haynes and Boone LLP.

Representatives from Gannett and Tucson Newspapers would not confirm whether the Justice Department has contacted them, but a spokesman from Lee Enterprises said representatives from the department began making inquiries as soon as Gannett announced its intention to sell the Citizen.

“I know the Justice Department has been involved in the fact-finding of the case,” said Dan Hayes, Lee’s vice president for corporate communications. “We’ve had our legal staff answering questions from the Justice Department as (the sale) proceeds.”

Wade said if the Justice Department was investigating the sale, it would do so in part to make sure Gannett and Lee had not colluded to close the Citizen just to make more money or “eliminate competition that will allow them to charge higher than competitive rates in the relevant market.”

Representatives of Lee and Gannett would not comment about discussions held among the two companies prior to Gannett announcing the sale of the Citizen.

Larry Aldrich, president and CEO of University Physicians Healthcare and former president of Tucson Newspapers, said he would be “quite surprised” if there had not been conversations between the companies.

“Typically most of these things are done in consultation and awareness and some cases in agreement with the other JOA partner,” Aldrich said. “They’d be talking about the willingness to restructure the contract subject to Justice Department approval.”

Should the Justice Department raise objections, Aldrich said “a good enough lawyer” could argue against breach of contract caused by the failure of Gannett to produce a newspaper.

“The problem is the contract has to be looked at in context,” said Aldrich, who has 25 years of litigation experience. “I’m a good enough lawyer I think I could argue that the contract certainly contemplates two newspapers being published but doesn’t compel two newspapers to be published.”

Aldrich said Gannett might have an interest in buying the Star from Lee Enterprises.

“It’s my opinion that it’s not Gannett’s MO to just own a profits-interest in an agency when they don’t own the newspaper,” Aldrich said. “It would be a little goofy for Gannett to retain that, so they would either sell their interest to Lee or they would purchase the (Star). And that’s the uncertainty – in this kind of market, Lee might be looking and saying the value of newspapers is really low and we’re not going to get fair value for our property, so we’re not selling right now.”

John Humenik, editor and publisher of the Star, would not comment for this article, but Hayes said Lee wasn’t selling the paper.

“We have no immediate plans to make any changes,” Hayes said. “Right after Gannett made the announcement, our CEO sent a note to our publishers all across the company to pass on the news release from Gannett and she said we do not anticipate any staffing changes at the Star as a result of this.”

Tara Connell, a Gannett spokeswoman, said the only thing on the table is selling the Citizen and would not comment on the possibility of Gannett buying the Star.

Robert Broadwater, managing director of the New York-based Broadwater and Associates, is handling the sale of the Citizen for Gannett. He would not say if any bids were received by Feb. 19.

Broadwater is also handling the sale of Denver’s Rocky Mountain News and the Seattle Post-Intelligencer, both in JOAs with larger papers in their cities.

In a phone interview, Broadwater said, “I do not recall” when asked how many JOA sales he had brokered.

He gave the same answer when asked how many of the sales he handled resulted in newspaper closures.

According to the company’s Web site, Broadwater provided “financial advisory services” to the E. W. Scripps Co. “in connection with the termination” of joint operating agreements in Birmingham, Ala., and Albuquerque, N.M.

The Albuquerque Tribune, an afternoon newspaper, was on the auction block for seven months prior to closing last February.

The Birmingham Post-Herald, a five-day afternoon newspaper, was closed by Scripps in September 2005. Broadwater said there was a private attempt to sell.

Gannett’s Connell said Feb. 10 that Feb. 19 was the “target date” for completed bids for the sale of the Citizen, “but if a bid comes in within a realistic amount of time to close, we’ll take it.”

She did not define what that time frame would be.

Citizen played key role in JOA law

The Tucson Citizen played a pivotal role in the passage of a law allowing newspapers to set up joint operating agreements that postponed the demise of two-newspaper towns.

The Arizona Citizen, which was born in 1870 as a weekly and went to daily publication in 1879, began experiencing financial strain in the 1930s. To stave off failure, the Citizen’s owners in 1940 entered into a joint operating agreement with the owners of the Arizona Daily Star where the two papers would share business and publishing costs, set advertising rates together and share in profits.

This arrangement went unchallenged until 1965 when the Citizen’s owners purchased the Star. In 1966, the U.S. Department of Justice sued Citizen Publishing Co. for violating antitrust laws barring monopolies.

The case was litigated for four years, finally winding up in the U.S. Supreme Court in 1969. Sitting on the sidelines were about 42 other joint-agency newspapers in 21 cities, according to a history of the Tucson Citizen written by former Citizen staffer Don Schellie. The fates of those papers would be determined by the suit against the Tucson Citizen.

“The Supreme Court affirmed that this was indeed a violation of the antitrust laws,” said James R. Wade, the former chief of the Litigation III section of the Justice Department’s Antitrust Division. “But then Congress took up the cause because they thought it was important to maintain editorial diversity in these cities.”

The congressional defense of the Citizen-Star JOA resulted in the Newspaper Preservation Act, passed in 1970, which created a limited immunity from antitrust laws barring a monopoly for newspapers and allowing two newspapers to set advertising and circulation rates in the same market.

“The general view was that newspapers were in trouble even back then and the NPA was needed and that it was OK to sacrifice economic competition to keep the editorial competition and diversity,” Wade said.

The Citizen and Star were able to extend their JOA after the Newspaper Preservation Act was passed. The last time it was renewed was in December 1988, with a small revision in 1990 extending the renewal to 2015.

The Citizen-Star JOA was one of 27 that have been created over time, according to Mark Fitzgerald, editor-at-large of the newspaper trade publication Editor & Publisher.

Since 1970, 16 of those 27 JOAs have ended, usually with the closure of one of the papers, which is frequently an afternoon paper.

Although JOAs might have looked like salvation to struggling papers in two-newspaper towns, Fitzgerald said the agreements were never meant as a panacea for the ills that plagued the industry.

“It doesn’t preserve newspapers, absolutely not,” he said. “It creates a monopoly inside a city. Back in the good old days when you had a city supporting two papers and one went under, maybe another one would emerge. But with JOAs, you split up the market, monopolize the advertising and what happens is cities like Tucson and Denver, when they can’t support two papers, the lagging paper becomes a drag on the whole system.”

E.W. Scripps put the Rocky Mountain News in Denver up for sale on Dec. 4.

Fitzgerald said the more newspapers a town has, the better informed the public will be overall, and that two newspaper towns are always better than one newspaper towns, “but JOAs don’t save them.”

“They are marriages of convenience,” he said. “They last until they don’t last anymore.”

Citizen science reporter Alan Fischer (center) speaks with fellow city desk reporters Thursday in the Citizen's newsroom.

The old Star-Citizen building in 1949, at its North Stone Avenue site.

The scene in the Tucson Citizen newsroom in the early 1970s, before the paper moved to its South Park Avenue address in 1973.

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Citizen/Star JOA documents

Read the Joint Operating Agreement documents between the Citizen, Star, and Tucson Newspapers:

1940 partnership agreement

1988 partnership agreement

1990 update to agreement

2009 amendment

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A BAD YEAR FOR NEWSPAPERS

Daily newspapers have been in steady declines of circulation revenues and advertising revenue for the past few years. The losses have escalated as advertisers move their business to the Internet (particularly classified advertising migrating to free sites such as craigslist.com) as well as the general economic malaise that began in 2008. Here’s a breakdown of the most recent bad news in the newspaper industry:

December 2008 was a poor month:

• The Detroit News and the Detroit Free Press announce they will reduce home delivery of the papers

• The Tribune Co., publisher of the Chicago Tribune and the Los Angeles Times, files for bankruptcy

• E.W. Scripps puts the Rocky Mountain News up for sale.

January wasn’t much better:

• The Hearst Corporation puts the Seattle Post-Intelligence up for sale

• The Minneapolis Star-Tribune files for bankruptcy

• The Los Angeles Times announces plans to lay off 300 people – 70 from the newsroom – and fold its stand-alone California section into the main news pages, beginning March 2.

• Gannett Co. Inc. puts the Tucson Citizen up for sale.

And the downturn continued in February:

• The Tucson area’s Vail Sun closes Feb. 3 after only two years of publication

• Employees of the Sacramento Bee are told by corporate owner McClatchy Newspapers that they should expect layoffs, wage cuts and mandatory furloughs in early March.

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TWO-PAPER REQUIREMENT

The original joint operating agreement between the corporate parents of the Tucson Citizen and the Arizona Daily Star requires publication of two papers through 2015, even if one of the papers is sold.

Section 5.3(f) of the JOA reads that, following the sale of either paper, “and for the remaining term of this Agreement . . . the Buying Party shall print, produce, distribute and market (both circulation and advertising) the newspapers in the same manner that this agreement contemplates shall be done by (Tucson Newspapers), subject in all cases to the editorial independence of the newspapers as contemplated herein. Each of Star and Citizen shall continue to be obligated to provide news and editorial product . . .”

The amendment filed Feb. 13 negates that section, reading, “From and after the Closing Date, Star and Citizen shall each continue to have a 50 percent interest in the assets, liabilities, profits and losses of TNI Partners (the Partnership) and the Partnership Agreement shall continue in full force and effect except that, (a) the purpose of the partnership shall be to operate a single newspaper, the Arizona Daily Star, and (b) all direct and indirect references to the Tucson Citizen shall be deleted.”

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Timeline

1870: The Arizona Citizen, a weekly newspaper, is founded by John Wasson.

1877: Wasson sells the paper to John Clum.

1879: Clum takes the paper daily and changes the name to the Tucson Daily Citizen.

1879: The Arizona Daily Star begins publication after several years of fits and starts as a weekly.

1880: Clum sells the paper and moves to Tombstone. The Citizen then changes hands numerous times until 1936.

1936: William A. Small Sr. buys the Citizen.

1940: The Citizen enters into a joint operating agreement with the Arizona Daily Star.

1965: Citizen purchases the Star for $10 million to prevent it from falling into the hands of a national newspaper chain. The stated intent is to find a local buyer and sell it as soon as possible.

1966: The U.S. Justice Department sues Citizen Publishing, saying its ownership of the Star violates federal antitrust laws. The Citizen loses and appeals all the way to U.S. Supreme Court.

1969: Supreme Court rules newspaper JOAs are a violation of antitrust laws. The Citizen leads an effort to create an exemption to antitrust laws for newspapers.

1970: Congress passes the Newspaper Preservation Act and President Nixon signs it.

1970: Citizen Publishing sells the Star to St. Louis-based Pulitzer Co. for $10 million.

1976: The Small family sells the Citizen to New York-based Gannett Co. for $30 million in stock.

1977: Gannett changes the paper’s name to the Tucson Citizen.

1988: Gannett and Pulitzer renew the JOA for 25 years.

1990: A small revision to the JOA extends its life to 2015.

2005: Lee Enterprises buys Pulitzer Co., takes over ownership of the Star.

2009: Gannett announces it will sell or close the Tucson Citizen, effective March 21.

Pulling together seen as step to solve problems

Fox Theatre

Operators of the city-owned Fox, Rialto, Temple of Music and Art and Tucson Convention Center theater complexes are looking for ways to collaborate so that the downtown theater district can function more effectively.

The Fox Theatre’s financial turmoil in recent months raised the alarm for other art entities to revive the collaborative efforts from 20 years ago that saved the Temple of Music and Art, the home of Arizona Theatre Company.

“So many times people are reactive,” said Andy Holtz, general manager of the Arizona Theatre Company. “It’s good to be proactive.”

Financial troubles at the Fox last summer got the attention of Councilwoman Regina Romero and Jim Cook, a former general manager at ATC and the now-shuttered Tucson Center for Performing Arts, 40 E. 14th St.

“Casual conversations lead to formal conversations,” Cook said. “Can’t we do better as a community to think strategically on how to coordinate the performing arts venues with downtown redevelopment?”

Cook was the convener for Romero to launch a downtown performing arts facilities management working group, which had its first brainstorming session at 8 a.m. Friday.

The meeting brought together leaders for all the above theaters and representatives from Councilmembers Romero, Nina Trasoff and Steve Leal’s staffs, the city manager’s office and the Parks and Recreation Department.

“How can we pool resources or management strategies that might work?” Romero aide Diana Rhoades asked.

One thing that became clear to Jaret Barr, assistant to City Manager Mike Hein, was that the city has widely differing operating agreements with the private-sector organizations that occupy the city-owned theaters. Maybe the agreements should be standardized, Barr said.

Longtime downtown architect Corky Poster won unanimous support for each theater operator to write up a one-page sheet of capital needs and a one-page sheet for operational needs. And Holtz asked the city to compile a list for everybody on how much the city is investing in each of its theater facilities.

Participants agreed the working group should expand to include other theater groups and the Tucson Pima Arts Council. Arts entities who want to take part can contact Rhoades at Ward1@tucsonaz.gov.

Holtz said theaters could consider a combined ticketing system, which could be accomplished as ATC plans to upgrade its own ticketing system. He said he thinks a solution for the Fox could be a resident company such as the Grand Ole Opry in Nashville, Tenn., or Prairie Home Companion in St. Paul, Minn.

Debts will be fully repaid and work could resume in three to four months to complete infrastructure at Saguaro Ranch after the high-end development filed for Chapter 11 bankruptcy protection Friday, an attorney said.

“Everyone is going to be paid. Everyone is going to get 100 cents on the dollar,” said Eric Slocum Sparks, a Tucson bankruptcy attorney representing Saguaro Ranch.

The 1,100-acre project in the Tortolita Mountains, appraised last June at $135 million, has liabilities of about $26 million, Sparks said.

“A number of things were not completed. Expenses got so high the last few years, costs accelerated at three times what they should be and they did not have the money to finish the infrastructure,” Sparks said.

The project will take advantage of reduced construction costs brought on by the housing industry crash, he said.

Plans call for the project to borrow $7 million to $10 million in debtor-in-possession financing within the next 90 days to fund completion of 130 home lots, casitas, a spa and 25 miles of hiking, biking and equestrian trails, he said.

Debtor-in-possession bankruptcy status allows Saguaro Ranch to continue to run operations, while offering new lenders priority over existing mortgage holders for repayment, he said.

Day-to-day operations at Saguaro Ranch, including McClintock’s restaurant, will continue with no employment cuts, Sparks said.

The project will eventually feature 180 home sites, about 50 of which have been sold, he said. The most recent lot sale was for $1.3 million, and homes in the project range up to $7 million, he said.

Key Arizona legislators identified possible budget cut options Thursday that could approach approximately $390 million for the statewide university system.

A figure of that magnitude would be double the $191.5 million in cuts recently instituted for Arizona State University, the University of Arizona and Northern Arizona by the Legislature for the current fiscal year.

Those reductions, from a total of $1.13 billion appropriated for the universities, helped eliminate the state’s $1.6 billion budget shortfall brought on by the crumbling economy.

The universities also get money from tuition and federal grants. State Board of Regents President Fred Boice told legislators at a hearing in Phoenix that possible new cuts would “cause severe damage.”

Boice told legislators that regents and the universities’ administrators recognize that there are more cuts coming “that are severe and will have to be severe.”

But he said that 85 percent of the universities’ budgets go toward employee costs, so while any cuts implemented will hurt employees, “of course our students will suffer” too, because layoffs will translate to fewer and larger classes and mean lengthening the time it takes many students to graduate.

“What we have to be very careful of at the University of Arizona is that we do not in a very short period of time destroy … a great research university,” President Robert Shelton said.

Research programs at the university drew $530 million in federal and other grants during the current year, but Shelton said that figure probably will be reduced some next year.

“If the U of A doesn’t succeed in competing for federal research dollars with Cal Tech, Johns Hopkins and MIT, I can assure you that those funds will go elsewhere,” he said.

Shelton also said the university remains committed to a biomedical campus in Phoenix. But he cautioned, “If we make any further cuts, we might as well start closing up that shop or drop back to a maintenance level.”

ASU President Michael Crow said his university’s mission as a comprehensive metropolitan research university is to make it institution accessible to the general population.

“We will remain committed to this mission come-what-may, no matter what,” Crow said. “It is our mission” — regardless of the level of investment that the Legislature makes.

But Crow added that the cuts ASU instituted for the current fiscal year reduced the level of state-invested dollars-per-student back to what the school received in 1998.

With more substantive cuts next year, he said, “We will begin to move to a point where we can’t just reorganize and focus our talent. We will have to repurpose the institution.”

Crow also said that the ASU West campus is being refashioned as a new, medium-sized undergraduate-only four-year college, designed to operate at lower cost and possibly as a future model.

As a state, Crow said Arizona is underproducing college graduates by half to reach what is the national average.

Rep. Rich Crandall, R-Mesa, said cuts of the size mentioned in the chairmen’s options would be, according to Crow, devastating and catastrophic to the system.

But Crandall also said the options listed aren’t all the ones that will be available to the Legislature. The situation could be changed significantly depending upon the federal stimulus package that Congress ultimately approves, he said.

“We don’t know what’s going to happen,” said Rep. John Kavanagh, R-Fountain Hills. “I hope we don’t dwell too long on this math. If the cuts are deep it will be devastating. If the cuts aren’t too deep, it won’t be devastating. I don’t think we’re in Doomsday based on what has happened so far in ’09.”

NAU President John Haeger said his university’s core mission, and continued goal, is to remain focused on undergraduate education. But he said that continued severe cuts — potentially of more than $20 million in the next fiscal year — would jeopardize that mission.

Effect will last to 2011, local expert says

Tucson homebuilders now are in competition with foreclosure sales, not each other, a local expert says.

And foreclosures are winning.

Foreclosures drove down housing starts and median home prices last year and will remain a force in the housing market until at least 2011, said John Strobeck, author of the Southern Arizona Housing Market Letter.

Foreclosure sales accounted for 18.5 percent of all home resales in 2008 and peaked at 30 percent in December, Strobeck said Friday.

The median new home price in metro Tucson was $217,393 at the end of 2008, and Strobeck believes it will fall to $175,000 this year.

The median resale home price plummeted from $200,000 in March 2008 to $165,000 in December, he said.

In 2008, 12.4 percent of new homes sold for less than $150,000, while in 2006 a sub-$150,000 new home “didn’t exist,” said Strobeck, also the owner of Bright Future Business Consultants.

“Here is the reason we’re seeing all this,” Strobeck said to more than 200 people attending his 12th annual new construction review, analysis and forecast lunch at The Westin La Paloma Resort & Spa.

“There’s a thing called foreclosure. That is becoming a huge part of our market. That is the most significant part of our problem.”

Strobeck said there were 9,000 foreclosure filings in the Tucson area in 2008, and he expects the Tucson housing market will have to absorb 13,000 foreclosed homes through 2011 – the equivalent of a one year’s worth of all new and resale home sales.

New construction permits dropped 41 percent in 2008, from 5,098 in 2007 to 3,018. And they are down 74 percent from the 11,762 permits issued in the greater Tucson area in 2005.

Strobeck expects construction permits for single family homes to fall to 2,000 this year, then creep back to 2,500 in 2010 and 3,000 in 2011 – all lower than any year since 1992.

Strobeck has an idea for how homebuilders can get work for themselves and their subcontractors.

“I’d like to see builders buy foreclosed homes, remodel them and resell them,” Strobeck said.

Strobeck is adding foreclosure prices to his monthly report of median and average prices for new and resale homes.

“There’s no reasonable fix that I know of (for the foreclosure epidemic),” he said. “The nice thing is it’s a temporary problem. We’ll get through it. It must run its cycle.”

Residential land sales in the Tucson region had similar dynamics in 2008. In the past four years, combined land sales tumbled from $750 million to $109 million, said Jim Marian, a partner at Chapman Lindsey Commercial real estate services.

“There was not a single land transaction for $10 million in 2008,” said Marian, adding that recent years have seen five to 15 $10 million-plus land sales each year.

Salary freezes, fewer summer classes on tap

Tucson Unified School District Superintendent Elizabeth Celania-Fagen's insistence on having several million dollars in carry forward funds for this fiscal year may be saving the district from drastic budget cuts this year.

Tucson Unified School District’s decision last summer not to give pay raises to employees may have been unpopular then but it’s looking pretty smart now in light of budget cuts imposed by the Legislature last week.

The resulting carry forward, or rainy day fund, of $6.2 million for 2008-09, will help the district absorb a funding cut of more than $8 million for the rest of the school year. But other Pima County school districts are talking about hiring freezes and reducing summer school.

Amphitheater Public Schools, which must cut almost $1.6 million from its maintenance and operations budget this school year, has no carry forward, Associate Superintendent Todd Jaeger said. The district isn’t sure what it will do, but knows it will have to do something soon, probably next week, he said.

“The average employee makes about $46,000 to $47,000,” he said, but most employees are under contract. “So the cut is about the equivalent of 32 employees; or it’s a 2 percent salary decrease across the board – although we haven’t talked specifically about that. We’re looking at different scenarios. And we are going to try to avoid doing anything that would take someone’s job this year.”

He said he is hoping much of the money can be saved by not filling vacant jobs.

“We do know we are going to try to keep the cuts as far away from schools as possible,” Jaeger said. “But that’s hard to do when we already are doing that as much as possible. We’re having almost daily meetings on the budget issue.”

Jaeger said Amphi tries to have “half a million to a million dollars in carry forward, but budget circumstances being what they were, we didn’t have that. We had about $1,000 at the beginning of the year and that’s gone.”

Across the state for the rest of this fiscal year, public schools districts had $98 million in reductions in base level funding, a 2.343 percent average cut, and $21 million in cuts for soft capital (computers and textbooks), a 10.5 percent cut.

Charter schools had a $4 million reduction, a 2.55 percent cut in additional assistance, said Department of Education spokeswoman Amy Rezzonico.

Stephanie Grisham, communications director for the Arizona Charter Schools Association, said, “school districts have roughly 900,000 students while charters serve 100,000 . . . so the cuts done by the Legislature are quite equitable.”

Most local districts report they are trying to avoid layoffs for this first of two cuts by the Legislature. The second cut is expected to come in the budget for next fiscal year, which begins July 1. Public school funding could be reduced more than 20 percent from the current year’s funding, including the cuts just imposed, some state education officials predict.

Since salaries and benefits usually account for almost 90 percent of district budgets, layoffs seem almost a certainty next fiscal year, they said.

This year, however, Marana and Flowing Wells unified school districts, which historically try to set aside close to the maximum allowed for carry forward, should have enough money to weather this storm better than other districts. Districts can carry forward up to 4 percent of their operating budgets each year.

Still, Marana spokeswoman Tamara Crawley said the governing board met Thursday night to address the issue for next year. The district plans to have a couple of forums in March to hear from the public. In the meantime, Marana and Flowing Wells are looking to cut corners.

Marana is accepting applications for substitutes only for health aides and special education aides. It is “closely reviewing any request for capital expenditure, supplies, travel and training,” Crawley said. “And we have eliminated any out-of-state recruiting efforts.”

Flowing Wells has moved from a soft hiring freeze to a hard freeze, meaning only essential positions will be filled. And supplies will be bought only for health and safety issues, said Superintendent Nic Clement.

“I don’t think we anticipated in July of 2008 that we would get a 2 percent hit now, so we didn’t do the budget that way, but being at the limit for a carry forward gives us some flexibility,” he said.

TUSD has a $6.2 million carry-forward for 2008-09 in its $362 million maintenance and operations budget; a $2.7 million carry forward in its $12.6 million soft capital budget; and a $700,000 carry forward in its $6.8 million unrestricted capital budget.

“We don’t have to cut anything for this year – programs, teachers, classrooms, nothing,” said Communications & Media Relations Director Chyrl Hill Lander. She said the TUSD hit from the state is about $6.8 million in maintenance and operations and nearly $1.8 million in soft capital for items such as textbooks and computers.

TUSD’s $6.2 million maintenance and operations carry forward compares to $193,000 available the previous year, a figure that worried new Superintendent Elizabeth Celania-Fagen. On July 1, she took over a district that was battling a public image that it was not transparent or fiscally responsible.

It was at the 34-year-old Fagen’s insistence – and the insistence of new financial leaders in TUSD last year – that the millions would go untouched for raises, which were estimated, along with benefits, to cost TUSD $2.8 million for each 1 percentage point increase in salaries.

As for this year, Lander said TUSD still “will implement measures to maximize our ability to stretch our existing resources and provide carry-forward dollars for the next fiscal year. We will be carefully reviewing all position openings and travel requests and Human Resources is considering freezes on non-essential positions.”

The TUSD Budget Advisory Committee also is working to establish priorities to help guide the district in developing next year’s budget, she said.

Next year, TUSD expects to be required to cut $20 million to $80 million from its budget.

In an e-mail to employees Wednesday Fagen said that the more than 1 percent carry forward meant “we will not need to impact any employees’ contracts this year.” But “2010 is another matter. We have no idea where the Legislature is going to land with regard to education cuts in 2010. We do know that they have a $3 billion-plus deficit for 2010, that education is 40 percent of their discretionary (not voter protected) budget, and the state leadership has said they will not agree to any new taxes (including the suspended county equalization tax).

“We must hope and work for the best and plan for the worst. We have no other choice,” Fagen added. “There is no question that central services will be reduced next year as a result of this pending budget reduction.

“We are starting with central office in creating $30 million, $40 million and $60 million (reduction) scenarios to present to the TUSD (School-Community) Partnership . . . and we are preparing to propose to the Partnership that we provide schools with full-time equivalent (FTE) allocations that the district can afford (based on enrollment) under the $30 million, $40 million and $60 million reduction scenarios,” she said.

School site councils then will be given a “menu” to accompany their FTE allocations “whereby they can choose to ‘spend’ their FTE any way they feel is best for their school,” Fagen wrote, “as long as it is legal, etc.”

Sunnyside Unified School District Superintendent Manuel Isquierdo met in a special meeting with the governing board early Thursday morning to talk about the budget and prepare members for questions from the public and staff. He met with principals after that.

He has assured employees no one will be laid off this school year but said site improvements and repairs, as well as technology and other capital purchases, would be minimized.

“Only crucial safety repairs will be done,” a district information sheet stated. And school communications will be sent home with students to reduce postage costs.

Teachers are being asked to take fewer days off to save about $250,000 in costs for substitutes. Monique Soria, Sunnyside’s public relations director, said last year the district spent $1.3 million on substitutes, and so far this year has spent $600,000.

Summer school will change from a five-day a week program to four days a week and from 17 sites to seven or fewer. “We will not turn students away, but this will enable us to save money on utilities and staffing and to be more efficient,” Soria said.

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PUBLIC SCHOOL FUNDING CUTS FOR 2008-09

District Cuts to M&O Cuts to soft capital* Carry forward for this year

TUSD $6.8 million $1.8 million $8.9 million

Marana $1.344 million $281,000 $2 million

Flowing Wells $800,000 $125,000 $1.1 million**

Sunnyside $900,000 $500,000 $800,00

Amphi $1.6 million $353,000 none

* computers, textbooks, durable equipment such as copiers

**$600,000 in soft capital of $1.1 million carry forward already used to purchase science books and kits

M&O is the maintenance and operations budget through which most school functions are paid.

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RALLY FOR PUBLIC EDUCATION

Public school supporters are organizing a rally at the state Capitol from 10 a.m. to 1 p.m. Feb. 26 at the State Capitol.

The Sunnyside Education Association and an anonymous donor will pay the cost of 10 buses, which will leave from Sunnyside and Desert View high schools, starting at 7:30 a.m. The buses should hold about 500 people and rally organizers are hoping that parents, students, educators and the public will go.

For more information, e-mail rally organizers at Rally4PublicEd@email.com

After partner pulls out, ‘What we want to show is activity’

Even with Williams & Dame Development no longer part of the Downtown Tucson Development Co., the 20-year vision to redevelop much of the east half of downtown remains in place.

The Portland, Ore., developer recently parted ways with partners Scott Stiteler and Jim Campbell after financier Stiteler and Williams & Dame “were not able to come to agreement on our role in the company moving forward,” Williams & Dame said in a statement.

“It purely had to do with the economics of the situation,” company manager Campbell said. “Is it smart to spend spend $2 million on planning (in this economic climate)?”

Campbell said the company is pressing forward to show results on the Rialto Block, owned by Stiteler and Don Martin; the neighboring city-owned Rialto Theatre; and getting the Skrappy’s youth entitlement center into a new home as soon as next week.

“The big difference as of yesterday (Wednesday) is the discussion of planning,” Campbell said. “The focus is on sticks and bricks instead of paper. What we want to show is activity and progress.”

Williams & Dame served as the team’s planner and had completed about 90 percent of the conceptual plan due to the city by late April. This will include plans, sketches, photographs and text that describes an overall vision for the 75-acre area that includes the Warehouse Arts District up to Sixth Street and the Congress Street Entertainment District.

Stiteler, who quietly negotiated a pre-development agreement with the city, is the company’s financial arm. He also is half-owner of the Rialto Block and majority owner of the One North Fifth Apartments and three storefronts on Congress Street across from One North Fifth. Williams and Dame and Tucson-based Peach Properties remain minority owners of One North Fifth, but otherwise the Portland developer no longer has active projects in Tucson.

Williams & Dame had taken the lead in discussions with the Warehouse Arts Management Organization, which the company wanted to help renovate warehouses along Toole Avenue. Stiteler has assumed direct relations with WAMO and met with the warehouse group Thursday, Campbell said.

The company in the pre-development agreement committed to giving WAMO $2.5 million to assess and rehabilitate the two dozen state-owned warehouses that are occupied by artists. But a stall in negotiations between the state transportation department and the city to transfer ownership to the city has put WAMO on the company’s back burner.

“It makes no sense to assess the warehouses now,” Campbell said. “When ADOT got pushed off, the whole warehouse thing was put on hold.”

Campbell said WAMO has to plan for three contingencies: the city acquiring all the warehouse, some of them, or none of them.

City Councilwoman Regina Romero said the council on Tuesday will consider releasing $65,000 to WAMO to start a business management plan. The money will come from the city trust fund funded by rents warehouse tenants pay.

Romero met on Wednesday with Stiteler; Campbell; WAMO President Marvin Shaver; Jaret Barr, an assistant to the city manager; and C.T. Revere, chief of staff to Councilwoman Nina Trasoff.

“I feel much more comfortable,” Romero said. “They are still very committed to WAMO, still very committed to Skrappy’s and still very committed to the Rialto Block. They still want the arts district to flourish.”

Williams & Dame was a signatory to the pre-development agreement. Barr was not sure how that would affect the document, adding that it was a precursor to a formal development agreement that will likely be done in summer.

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Williams & Dame Statement

“It has been a privilege for Williams & Dame Development to support the City of Tucson’s vision for the revitalization of Downtown. We are particularly proud of our work on the first successful mixed use development in downtown Tucson, One North Fifth, for which Williams & Dame Development secured a $6.1 million note representing 75 percent of the project’s financing. At this time, however, we have decided to discontinue further participation in the Downtown Tucson Development (Company). While we had an agreement with our partners about compensation, we were not able to come to agreement on our role in the company moving forward. We remain optimistic about the future of Tucson and are grateful for the chance we’ve had to make a positive difference in the community. ”

Tucson and Pima County will together receive about $10.37 million in federal money to buy foreclosed or blighted properties.

The grants – $3,086,867 to Pima County and $7,286,911 to Tucson – come as part of a $4 billion initiative intended to lessen the effects of accelerating foreclosures.

The money cannot be used to help those facing the loss of their home. Rather, it is slated to rehabilitate and resell abandoned or foreclosed homes and “stem the decline of house values of neighboring homes.”

The U.S. Department of Housing and Urban Development announced the allocations Monday.

With its share, the county plans to:

• Buy and repair 20 foreclosed homes that will be sold or rented under a land trust system that makes homes more affordable by subtracting the cost of the land from the purchase price.

• Buy between five and seven rental units to lease to households with incomes less than 50 percent of the area median income.

• Buy and redevelop or “land bank” seven South Tucson lots to be managed by the Primavera Foundation.

• Buy and redevelop or land bank seven Ajo lots, to be managed by the International Sonoran Desert Alliance.

About $300,000 of the total is slated for administrative costs.

Tucson plans to:

• Buy and rehabilitate 10 foreclosed rental properties to rent to households making less than 50 percent of the area median income.

• Buy and rehab at least 26 foreclosed homes to resell as part of the community land trust. These homes would be sold to those making less than 65 percent of the area median income.

About $700,000 is slated for administrative costs.

Local officials said there are still kinks in the program.

Under federal rules, governments must pay no more than 85 percent of market value for the bank-owned properties.

Officials worry that, in combination with the lower prices of homes inside a land trust system, the price stipulation could push home prices down further in areas that were chosen.

“We really don’t want to have a negative effect,” said Marcos Ysmael, a housing program coordinator with Pima County’s Community Development and Neighborhood Conservation Department.

Details of how to take advantage of the program are being worked out.

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AREA MEDIAN HOUSEHOLD INCOME

One person $38,500

Two $44,000

Three $49,500

Four $55,000

Five $59,400

Six $63,800

The Arizona Builders’ Alliance, a trade association of commercial builders, is seeking applications from local nonprofits for free renovation services.

One nonprofit will be chosen.

In 2008, the association provided $200,000 in materials and labor to Vida Nueva, a residential treatment center for women operated by Compass Behavioral Heath Care.

Vida Nueva residents got new flooring, a playhouse, kitchen cabinets and new bathroom sinks and vanities, along with an electronic security gate, among other improvements. All materials and labor were donated by association members.

To apply to be the 2009 recipient of the alliance’s charity renovation, nonprofits should send a letter describing their need to alliance director David Pittman at 1661 N. Swan Road, Suite 144, Tucson, AZ 85712.

The deadline is Feb. 20. For more details, call 881-7930.

EL PASO, Texas — An Arizona-based copper company says it will not reopen its El Paso smelter and plans to demolish the century-old plant.

Asarco LLC, a bankrupt Tucson, Ariz. copper company, said in a statement Tuesday that a “dramatic downturn of the world economy” prompted the decision to keep the plant closed for good.

The smelter, part of the El Paso skyline since the 1880s, was shuttered in 1999 amid a global drop in copper prices. For the past few years company officials have insisted that the plant would reopen, despite the objections of El Paso officials and numerous community groups.

In announcing plans to raze the smelter, Asarco said the company would work with Texas officials to fund a trust for the demolition and remediation of the land below and around the plant.

Bankruptcies in Pima County rose 77 percent in January compared with year-ago filings.

That’s about even with the statewide rise in filings, prompted by the weakened economy causing layoffs and business closures.

The Tucson sector of U.S. Bankruptcy Court – which includes Cochise, Graham, Greenlee, Pima, Pinal and Santa Cruz counties – showed an 88 percent gain in filings in January. Pima and Pinal counties make up 90 percent of the filings in the Tucson sector.

Most of the filings were Chapter 7 individual liquidation, which more than doubled from 126 in January ’08 to 267 last month.

The number of Chapter 13 filings, business liquidation, rose 32 percent, from 63 to 83.

The nationwide recession is hitting Pima County hard. Since December 2007, the Tucson metro area has lost 15,700 jobs. Unemployment soared from 5.8 percent in November to 6.5 percent in December.

One vendor says sales are off 80 percent

Bruce Catlin, 54, shops for quartz with his daughter Erica, 19. He owns a store in northern California called Soul Connections.

The Tucson Gem, Mineral & Fossil Showcase is off to a slow start.

Sellers are leery of the economy but remain hopeful things will pick up as buyers hunt for just the right stone.

“So far we’re still waiting for it to get started,” said Shay Clayton, 58, a seller from Phoenix who’s on his eighth year at the gem shows.

“Even if we didn’t make money, it’s just so much fun to come here and and see everybody from all over the world,” he said.

Deepak Maloo, 43, of Jaipur, India, said this year is his eighth and worst year, with an 80 percent drop in sales so far when compared with previous years.

He expected lower sales but didn’t think they would be as bad as they are, he said.

But even with lower sales, there are buyers.

Bruce Catlin, 54, owns a metaphysics store in northern California called Soul Connections. This year is his ninth coming with his daughter, Erica Catlin, 19.

“It’s been a father/daughter thing every year,” Erica Catlin said. Her mom stays home every year to run the store.

Bruce Catlin said he is spending just as much money as he did in previous years, but is more selective because of the economy. He arrived a few days early to buy at events for wholesalers.

After scrutinizing each rock with a loupe (magnification device), enthusiast Fred Friel, 54, of Boise, Idaho bought a bag each of amethyst and citrine from Rebecca Kabosha, 48, a Zambian seller.

This is Kabosha’s third year at the gem shows. Like many other sellers, she is reporting a drop in sales but is hopeful she will make a profit after paying $3,096 for her booth.

Despite the anticipation of a slow economy, there are sellers here for the first time.

Daniel Webster, 34, drove with his wife, Brianne, 29, and son, Isaac, 8, from their home in Utica, N.Y.

He rents his booth for $50 a day and can pack up and move if he feels he is losing money.

Isaac, who is home-schooled, was enjoying the weather as he played with his best friend Harrisen Fusco,7, whose family is visiting the Tucson area from Deerfield, N.Y.

“This is definitely a nice time for me to be here,” Isaac said. “Because in New York, I would be an icicle.”

Also in the sun, but under a red parasol, was Violeta Yarosh, 73, of Tucson. This is her second year at the gem shows and she plans to bring her friends.

“They all want to come,” she said.

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Gem shows

The Tucson Gem, Mineral & Fossil Showcase – an international marketplace of buyers and sellers – runs through Feb. 15.

It consists of 45 shows at 42 sites, including the 55th annual Tucson Gem and Mineral Show at the Tucson Convention Center.

Dozens of shows will take place at the same time downtown and at other locations – in giant white tents, at hotels, resorts and exhibit halls.

There’s something for everyone at the many public shows, from gold and diamonds to granite bookends and glass beads to fine specimens of dinosaur fossils to opals dug from the Australian outback.

Some shows are open to wholesale buyers only and require credentials to enter. Most of the gem and mineral shows operate from 10 a.m. to 6 p.m. daily.

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For a complete schedule

www.xpopress.com/Tucson-show-schedule.html