Republican Mayoral Candidate Rick Grinnell (Image credit: Grinnell facebook page)

For a city with the highest rate of poverty in the Sunbelt, you’d think there would be a few candidates talking about poverty, homelessness, unemployment/underemployment, and related issues in their campaigns.

As I listened to the KXCI rebroadcast of the recent candidate forum, I was stunned by the issues that occupied most of the candidates– particularly the Republican candidates (Mayoral Candidate Rick Grinnell and City Council Candidates Jennifer Rawson and Tyler Vogt).

Apparently, the biggest issues facing our city are not poverty, home foreclosures or unemployment; they’re burdensome development fees, over-regulation of businesses (particularly developers), and an oppressive anti-business city government.

I guess it is understandable that the Republicans would be running pro-business camgaigns, but Grinnell goes beyond business-friendly. Grinnell is the mayoral candidate for the 1% class. Here are some facts to back up this statement.

• Grinnell is a lobbyist, and the largest client for Grinnell’s lobbying firm is Rosemont Copper– two facts that are not mentioned on his campaign website. The online description of Grinnell’s SUBS (Smart United Business Strategies) doesn’t even mention that it is a lobbying firm. SUBS is described as: “a for-profit venture that fosters political interaction between State and Local government and the entrepreneurial community.”
• Grinnell’s campaign manager is big-time developer John Wesley Miller. (No wonder Grinnell is lobbying…er… campaigning so hard against development fees and for streamlining development processes.)
• In a recent Arizona Daily Star article entitled Mayoral Candidates: Jobs are No. 1 but… , Reporter Rhonda Botfield writes, “Grinnell, a consultant for Rosemont Mine and for restaurant owner Bob McMahon, said his longtime work on business issues will give him an edge in helping support economic development by eliminating barriers to growth and providing the necessary infrastructure. ‘If we don’t get some wealth-generating opportunities, we will collapse,’ he said. He said not only does the city need an attitude adjustment – such as strengthening its customer service approach – but also needs a more coordinated effort in recruiting new businesses.” Again, business, business, business. [Emphasis added.]
• Grinnell’s campaign ads– along with those of  Rawson and Vogt– have been produced by the same agency that produced the now infamous Swift Boat ads against John Kerry.
• Grinnell is on the current Rio Nuevo Multipurpose Facilities District Board. (You know– the board that is suing the City of Tucson for $47 million.) He was appointed to the Rio Nuevo Board by Arizona Senate President Russell Pearce.
• Grinnell also served on the old Rio Nuevo Citizens’ Advisory Committee, beginning in 2007; he was appointed by then Councilman Rodney Glassman. (You’ll remember that those folks helped the City Council bungle taxpayer monies in failed land deals and plans that never were implemented.) His service on the first RN board has been conveniently omitted from his bio on his campaign website.
• In addition to Grinnell’s position on the Rio Nuevo Board, he has been a member of the Pima County Sports and Tourism Authority since 2008. This is another one of those local boondoggle boards that chases fickle national sports teams and spring training contracts. Check out this report from the Brookings Institute and the Brookings’ book Sports, Jobs, and Taxes, if you don’t believe me. National sports teams pit cities against each other by encouraging hapless local politicians to waste taxpayer money on stadiums. (Remember Tucson Electric Park?) In the candidate forum, Grinnell even had a frustrated outburst when he said, Rio Nuevo was supposed to be an arena district! (Personally, I’m glad that arena football idea died.) Building stadiums makes money for developers and sports teams but not necessarily for cities.
• There are alleged improprieties in Grinnell’s campaign finance reports. Looking at his reports dated Oct. 25 online, the largest donations are from business owners, particularly construction companies, developers, and donors with ties to Jim Click. (Checking past campaign finance reports on the Arizona Secretary of State reveals that Jim Click has been a long-term donor to various Grinnell campaigns. He has run for several offices– also not on his resume.)

Seriously, how can you trust someone who has left major facts off of his resume?

On Grinnell’s website, he does list creating jobs and careers as a priority, but his 100 day plan is all about business.

I will host an economic strategy session with the business and social communities in order to identify who’s doing what, strengths and resources, and share a unified approach to regional economic stability.

Identify 100 local employers that want to expand and help them accomplish this. Identify and recruit another 100 new employers that are compatible and will complement existing local businesses. And we can do this keeping in mind the integrity of our neighborhoods and appreciation of our environment.

Help struggling businesses retain their employees, stay in business, with initiatives beginning with reducing utility tax to the pre-2010 budget.

Identify, reduce or remove the overburdening regulations that impede the process of expanding or starting new businesses. Remove duplication of services and shorten timeline involved in launching new enterprises.

Work with Rio Nuevo to restore the TCC to a first class Convention Center that will attract other large-scale events like the Gem Show. [NOTE: Grinnell is on the Rio Nuevo Board which is suing the city $47 million.]

Work with the tourism industry to expand our efforts in securing more group and personal tourism to our region. This could include the Southern Arizona Golf Trail.

Develop further communications with the State Legislature in Phoenix to strengthen positive relationship with our city. [Let's make nice with Republicans to the north.]

Identify local businesses that can utilize resources available to us through the Arizona Commerce Department’s that can help us provide additional support for employer and business expansions.

Strengthen relationships with our neighbors in Sonora, Mexico who bring in $1.3 Billion a year in revenue to Southern Arizona.

Maximize and leverage long-term resources in the region through annexation by first making the City of Tucson a successful and attractive model for neighboring communities. [Emphasis added.]

One last question for Grinnell: If you want to reduce or eliminate fees for developers and other businesses, how would you pay for that? Since the city is strapped for cash and since Republicans like to have “revenue neutral” policies, f you want to cut that revenue stream, you need to tell us how you would make up your proposed tax cut for the rich. Here’s a hint: If your answer is “raise bus fares”, you are truly the candidate for the 1%.

So, if you are lucky enough to be among America’s richest 1%, Grinnell’s your candidate for Tucson Mayor. If you’re among the 99%, I suggest you check out the websites of the other two candidates Democrat Jonathan Rothschild and Green Mary DeCamp. (Stay tuned for more on them.)

The tortured saga of Tucson’s new downtown hotel has been a long and twisted one.

Do we need a giant, glittering new hotel downtown?

How much will it cost?

Who should pay for it?

Who will own the debt?

Who will get the profits?

Tucson’s Mayor and Council have been waffling around these questions for years with no resolution. The downtown development drama got exponentially more complicated when the Republican-controlled Arizona Legislature created the Rio Nuevo Board to oversee how Rio Nuevo’s funds are to spent in the future. Over the summer there were public squabbles between the Mayor and Council and the Rio Nuevo Board. (One example: the RN Board didn’t approve of the M&C using downtown parking garage spaces to pay off a legal settlement with developer Scott Stiteler because of a contract dispute.

These stories led me– and I’m sure other Tucsonans– to wonder who’s really in charge? Did the Legislature clearly delineate the responsibilities of the RN Board and how they are to interact with the Mayor and Council? It appears not.

Tucson City Councilman Steve Kozachik has been pushing the City Council to drop the mega-hotel project– at least until the economy improves. He also believes that whether or not to finance and build the hotel is in the hands of the Rio Nuevo Board– or it was until they punted late last week and said the hotel fiasco belonged to the city.

According to the Arizona Daily Star, “…the project is in … well, “chaos” may be too strong a word, but “confusion” is not. Mix in confusion with political posturing by both the City Council and the Rio Nuevo board and the result is unacceptable. Especially on a project of this size and involving so much taxpayer money.”

Here is the text of Kozachik’s September 24, 2010 memo to the Mayor and Council, which he released after the RN Board ducked out of the hotel business (even though it is not clear that they lawfully can walk away from it– since they are supposed to be in charge of how the Rio Nuevo funds are spent.)

SUBJECT: Responsibility for Decision-Making on the Proposed Convention Hotel

There seems to exist a condition of leadership paralysis with respect to making a decision about proceeding with the Convention Center Project. The Rio Nuevo Board has suggested shifting the decision-making responsibility back to the City, where that authority resided prior to the Board having been seated by the State Legislature. With over $230 million in taxpayers’ dollars in the balance, the City must make sure that all relevant questions are answered openly and publicly.

1. Who is legally responsible to make the decision to proceed with the Hotel?
State Legislation placed the legal obligation to adopt a Guaranteed Maximum Price (GMP) and finance plan on the Rio Nuevo Board. And, the Master Development Agreement for the project is between Rio Nuevo and the developer Garfield Traub. What is the role of the Legislature in the decision by the Board to shift that burden to the City? Legally, how does the change in relationship affect the Master Development Agreement? Does a new agreement need to be negotiated?

2. If the District shifts responsibility to the City for the hotel decision, what role does the District now play in approving any contracts related to the project?
The Legislature stated that no TIF money could be spent on any projects other than the Hotel and related project elements until a Notice To Proceed had been issued by the District. If no such NTP is issued, what are the City’s options with respect to funding any other projects with TIF revenue? What role does the District then have in those decisions if they have shifted the duty/right to negotiate a hotel package to the City?

3. What other areas are affected by a change in the relationship?
What is the cost for putting together a finance program, that is, a bond package? Does the District have any financial obligation to assist in funding those costs with TIF dollars, or is it a General Fund obligation? Who negotiates the bond package? Who is involved in approving the terms of the package?

Subcontractor bids have expired. There will be a cost involved with re-submitting and re-evaluating a new set of bid documents. Do TIF dollars pay for those new costs, or is that a Developer cost to be borne by Garfield Traub? With the “owner” now out of the decision-making picture, who is to review and approve the bids with Garfield Traub?

There is no GMP. Previously, the District and the City have both been evaluating the proposed GMP submitted by Turner/Sundt. Is the City now in the position of making a unilateral decision with respect to the acceptability of the GMP and negotiating a new one in the event it concludes the existing price is too high? What role does the District now play in that process?

If the City puts together a funding package, does the District have any remaining role in its approval? If not, does this, in effect, constitute tacit agreement by the District that the City now controls the use of the TIF for this, and other projects the City deems appropriate use of those funds?

What we know is this:
a) There remain serious questions to be answered with respect to the financial viability of the Hotel.
b) In the present Convention Center Hotel market, there are numerous real-life examples that demonstrate the financial down-sides possible in operating a facility such as this.
c) There is no private sector money included in the financing of this project and the developer has openly indicated that he is unwilling to absorb any of the risk.
d) The “Team,” as described in the Master Development Agreement, with whom the District is to negotiate a Guaranteed Maximum Price and a finance plan, is comprised of commission-based firms who therefore have no incentive to produce for the City the lowest possible price for a high-quality product.
e) The taxpayers’ voice has been left out of the conversation. If the Rio Nuevo Board passes to the City the responsibility for making this decision, it is the Mayor and Council who are responsible to the taxpayers for whichever choice is elected, not the Rio Nuevo Board.
f) The voters are being asked to approve a sales tax increase along with a package that includes a significant salary increase for Mayor and Council. When the voters see those propositions on the ballot, their vote will reflect the level of trust they have for the governing body.

There appears to be a strong sense of urgency on the part of those who stand to benefit financially from this project that the District step aside and the City simply approve a funding plan that ultimately places the taxpayers at risk for what may well become an under-performing property. The decision to make this level of commitment comes while we are in midst of negotiating a GMP, in the midst of our trying to balance the FY2011 and FY2012 budgets, and in the midst of an effort by some in the City bureaucracy to convince the taxpayers of our need to adopt a sales tax increase. To take on a debt of this size while so many critical fiscal issues are unresolved is irresponsible.

It is time we protect the taxpayers’ interests and make a firm decision that, at this time, we cannot take on the burden of a risky capital project such as this. It is unfortunate that the District is now trying to absolve itself from fulfilling the leadership role in this matter that it was formed to exercise.

Nonetheless, the Board’s decision to stand down on the decision and place it back in the hands of the City does not obligate us as leaders in this community to approve a debt burden that is clearly inconsistent with the other fiscal realities with which we are faced. The timing is wrong, the finances are uncertain, and therefore the project must stop now until the market has improved to the point where some level of private sector investment can be included in the plan. (Emphasis added.)

Since he took office, City Councilman Steve Kozachik has been trying to hold the Mayor’s and other council members’ feet to the fire on the new downtown hotel deal.

The issue of whether or not to build a mega-hotel downtown has been complicated by Tucson’s ongoing budget problems– thanks to a downturn in the US economy, high unemployment and poverty in Arizona, cuts in funds from the state government and an over-reliance on tourism, sales tax, and the housing boon statewide.

All of this has been coming to a head since the City Council voted to send Prop 400, a 1/2 cent sales tax increase, to the voters this November. Labeled the “core tax”, it theoretically will be spent on core services– police, fire, and parks– but, as I understand it, that is not an iron clad promise.

City Manager Mike Letcher proposed 2 plans to balance Tucson’s budget– Plan A being pass the sales tax and Plan B being across the board 15% cuts in all city departments (including police and fire). (Plan B, I think, is a particularly stupid idea because it plays into the hands of the people who tried to pass Prop 200 last fall. They contended that the City Council didn’t value police and fire and would cut those services unless they were protected by the charter changed proposed in Prop 200, and here you go– not even 1 year later, Letcher’s Plan B proposes just that!)

As his answer songs, Kozachik has proposed Plan C and the hybrid, updated Plan D. I am not endorsing Kosachik’s Plan D whole hog, but I do agree with him when he says that there are steps that the City Council can and should take now–regardless of whether or not the sales tax passes. For example, included in Plan D are items like eliminating cars and car allowances for city employees (check this link and scroll down to see who gets this now); a 2% decrease in pay for city employees making above $96,000; increased “cost recovery” related to Parks and Recreation programs (ie, increased fees); a sliding scale Sun Tran fare increase; and much more. The kicker at the end of Plan D is killing– at least for now– the hotel project:

“Because of the uncertain impact on the General Fund, advise Rio Nuevo Multipurpose Facilities District Board that the City will not entertain any further consideration of funding proposals associated with the Downtown Convention Hotel until the sales tax has sunsetted (see below.)

“In the event sales tax fails at the ballot box, City will not entertain funding proposals for the Hotel until State-shared sales tax receipts to the City exceed those identified in “sunset” provision cited below.”

According to Kozachik (the sole Republican on the City Council), he presented Plans C and D as points of discussion and wants to discuss/debate the ideas with other members of the City Council. The problem is that the Democrats on the City Council didn’t want to discuss the plans.

At the September 21, 2010 City Council meeting, Kozachik also made this motion to tell the Rio Nuevo Board that the city was washing its hands of the hotel project proposed by Garfield Traub.

Convention Center Hotel and the City of Tucson

What is the City of Tucson’s legal obligation to the design, development and building of the Convention Center Hotel? The Master Development Agreement identifies the Agreement is between the Rio Nuevo Multipurpose Facilities District (The Owner) and Garfield Traub (The Developer).

The signature page of the Master Development Agreement states that the Mayor signs “Solely in connection with the City’s obligation and agreements pursuant to Sections 2.2.2, 4.1.14 and 4.2 of this agreement”

Section 2.2.2 relates to the construction of the East entrance and states that the agreement “obligates the City to expeditiously pursue mutually agreeable methods for funding the CC East Entrance Construction Fund” The City complied with this obligation by issuing additional Certificates of Participation.

Section 4.1.14 relates to the City issuing permits during the design phase and states “City agrees to expedite to the fullest extent possible plan review and approvals as well as the issuance of all permits and consents required for the project.” The City has complied with this obligation.

Section 4.2 relates to the City issuing permits after completion of the Design Development Period and states “City agrees to expedite to the fullest extent possible plan review and approvals as well as the issuance of all permits and consents required for the project” The project has not been approved and therefore the permits will not yet be issued.

Clearly, The City of Tucson has no contractual obligation to fund the project. In light of the dire financial condition in which the City finds itself, the City should not risk one more dollar of the taxpayer’s money on this project.

I move that the City of Tucson advise Rio Nuevo Multipurpose Facilities District Board that 1) at this time we do not intend to backstop or issue any bonds to secure the completion of the Tucson Convention Center Hotel, Parking Garage and Convention Center Expansion and 2) The City will not approve any additional expenditures for the Convention Center Projects until RN has negotiated an acceptable GMP and funding plan for the project.

This declaration of intent will allow the RNMF Board to decide if the project is financially viable in its current form and to decide if alternative funding methods are available. That obligation is clearly delineated in the MDA under Sections 4.1.13 and 6.6.

Section 4.1.13 assigns to Garfield Traub the responsibility of securing a Design Build Contract with Turner/Sundt and to negotiate a GMP, advising Rio Nuevo as that is developed.

Section 6.6 assigns to Rio Nuevo the responsibility of obtaining funding for the Project. The City of Tucson is explicitly not mentioned in the development of a financing plan.

We, as the City of Tucson, cannot simultaneously tell our citizens that we need for them to pass a ½ cent sales tax because we are in dire financial straits and also tell them that we are obligating their money to a $225 million project that has significant risks and assumptions associated with it. The turn in the economy has dictated that this type of risky project should not be placed on the shoulders of the citizens of Tucson. (Emphasis added.)

The motion didn’t go anywhere because no one seconded it. For Kozachik’s Ward 6 update on the meeting, check this link. To watch the City Council meeting online, check out Channel 12.

I do believe that Tucson needs larger, updated hotel accommodations downtown, but I don’t agree that the city should go hundreds of millions of dollars into hock for decades to build it. (Here’s a hint: there is a reason why the bankers aren’t financing this.)

>
For several weeks, the issue of SunTran control has been bouncing around the City Council Chambers and the media.

Today as the Tucson City Council considered whether or not to relinquish control of the SunTran bus service to the Regional Transportation Authority (RTA), pro- and anti-RTA demonstrators gathered outside (1, 2). The Teamsters Union (below) supports the move to RTA because they believe the RTA will provide a more stable funding source for the bus service and, therefore, the union members. Bus riders and representatives from Casa Maria Soup Kitchen (above) protested against the move to RTA because they fear steep fare increases and cuts to services if the regional authority takes over the buses.

Yes, the city is strapped for cash, but I disagree with the proposal to transfer SunTran to the RTA.

First of all, the vast majority of SunTran riders (in the neighborhood of 80-90%) are residents of the City of Tucson; this alone should be reason enough for the city to retain control. SunTran riders are people who don’t have other transportation, can’t afford to park or can’t find parking where they work (ie, the University of Arizona), or can’t drive, ride a bike, or walk to their destinations. Often– but not always– these people just can’t afford cars.

If SunTran were controlled by a regional authority, Tucson would have one equal vote along with several smaller suburban cities– such as Oro Valley or Marana. Obviously, potential suburban bus riders have different needs than the poor people and students who ride the city buses. Although Tucson is the biggest city in this group and has the most riders, it would be one voice among many at the RTA table.

RTA claims that it has solid funding, and this is why the Teamsters are supporting the RTA take-over. According to a radio interview between former City Councilman Steve Leal and activist Brian Flagg of Casa Maria, RTA would increase fares– perhaps even doubling them– if they take over SunTran.

The tragedy of all of this is that it pits workers who are fighting for their jobs and a living wage, against riders, who are fighting for affordable transportation and a means to get to their jobs or school. These groups should stick together, rather than battling against each other. At the end of the day, drivers and riders have more in common than they may believe today.