Fox Theatre's financial tangle revealed to Rio Nuevo board membersPosted: Updated:
TUCSON, Ariz. -- Debt, debt and more debt, and there's no money to pay it. The Rio Nuevo board met Thursday to untangle a complicated agreement with the Fox Tucson Theatre.
Taxpayers demanded to see the theater's finances and Thursday they were made public.
"This theater was dead in the water the day that this deal closed," said Fox Theatre Chairman Fletcher McCusker while addressing the Rio Nuevo board.
Rio Nuevo board members appeared baffled by a 2005 deal, that forced the district to lend the Fox Theatre foundation $4.5 million.
Now it's time to pay up and the district and the Fox Theatre have nothing to do but wait.
"There's really nothing any party can do until the tax credit recapture period runs out," said McCusker.
Their hands are tied until the summer of 2014, and the Fox owes $1.5 million by September 1, but the money's just not there.
"We have $57,000 in the cash. A far cry from the 1.5 million that's due to you," said McCusker.
Theater officials handed district members binders full of financial documents. Special Counsel Mark Collins sifted through it all and painted a grim picture for the board.
If the Fox can't pay up, the board still can't terminate the lease. The reasons are complex and make little financial sense. The district could sue the foundation, but they'd file for bankruptcy and nobody wins.
"We do not see a path to resolve this through litigation. We believe it has to be a business solution," said McCusker.
Fletcher McCusker says he'd like the two bodies to meet and refinance the debt.
"I do not believe, therefore, that you can just write-off this debt. It could be the kiss of death for the district at the legislature," said McCusker.
Thursday night, Tea Partiers pushing for the release of these financial details still want answers.
"It's high time that it has come out. What's the business plan? What's going to come of this theater," said Ally Miller from the Pima County Tea Party Patriots.
But those answers won't come until the board decides what to do next.
Both the board and the Fox Foundation believe the theater is still a valuable asset.
And plans are in place to raise money through things like a new restaurant and a gala in November.