Rio Nuevo audit highly critical of cityPosted: Updated:
An audit ordered by the State of Arizona into the first ten years of the Rio Nuevo District in Tucson is highly critical of how the city ran the project.
The audit was done by the firm Crowe Horwath of Texas and was released by the State Auditor's Office. Fox 11 News obtained a preliminary copy of the audit.
The audit goes into detail on the financial operations of the 1999 voter-approved "tax increment district" and says the City of Tucson took over the TIF and ran it "more like a redevelopment agency than a multipurpose facility district for much of its existence".
The audit says the Rio Nuevo Board which was in place until replaced by the State of Arizona earlier this year, exercised only "high level control and management over TIF funds" while virtually all the day-to-day management was done by the City of Tucson.
The audit is especially critical of how the city and the board spent funds generated by the TIF and says some were clearly outside the original intent of the voter-approved initiative. It says the city "spread the funding too thin and to public works-type projects that have not brought the District anticipated results".
The audit points out the original intent of Rio Nuevo was to support and improve the Tucson Convention Center. But it says very little has been done in that area and in fact says the city "has not developed the TCC as an adequate catalyst for increasing incremental sales taxes" in the district.
The auditing firm looked into the financial situation of the district and while it found it can meet its existing financial obligations, "its longer term decisions and challenges are significant".
The audit says one of the first things the new Rio Nuevo Board should do is send a bill to the City of Tucson for $450,000. The audit found the city has overcharged the TIF in interest rates for years.