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THEATRICS ON CONGRESS

The Rialto Theatre saga took another twist this week, with the City Council voting to move forward with a plan aimed at finding a compromise to resolve the differences between the Rialto Theatre Foundation and developers Don Martin and Scott Stiteler, of the Downtown Tucson Development Corporation.

The downtown theater, which is owned by the city and managed by the Rialto Theatre Foundation, is one of the few elements of Rio Nuevo that can be called a success.

But the foundation and its executive director, former Tucson Weekly editor and publisher Doug Biggers, have been fighting for the theater's future after Martin and Stiteler informed the Rialto Foundation that they planned to evict the nonprofit organization from the space surrounding the theater that the Rialto has been using as a green room for performers, as an administrative office and for storage space.

We've discussed the details of how this sorry state came to be in recent weeks, but here's a brief recap for those who came in late: Martin and Stiteler were furious with the Rialto Theatre Foundation, because attorneys for the foundation stood up and protested a deal that would have delivered $4 million in city property and control of much of the eastern end of downtown to Martin and Stiteler. At a June meeting, the council asked for another two weeks to examine the deal; the developers, in turn, walked away—and then turned their sights on hammering the Rialto.

In reaction to the eviction notice, Councilman Steve Leal asked the City Council to consider condemning the property, which Rialto management claims it needs to continue operating.

Why should the city step in? Because it owns the theater, and the council needs to protect its asset. The Rialto has proven itself to be an economic engine of the downtown arts and entertainment district over the last four years by bringing hundreds of thousands of people downtown, for hundreds of shows.

When it came time to discuss the theater at the Tuesday, July 7, City Council meeting, the council moved behind closed doors in executive session to discuss their legal options.

When they emerged, council members gave little details about their conclusions—but they voted to go forward with an appraisal on the property, which would be the first step toward condemnation.

More importantly, they called on the Rialto Theatre Foundation, the Downtown Tucson Development Corporation, the Rio Nuevo District Board and the city to enter into negotiations to resolve the fight between the developers and theater once and for all, with an update due at the council's August meeting.

Whether the council's vote is enough to forestall eviction remained to be seen as of press time.

"The city and the theater were backed into a corner by the developer," said Michael Crawford, president of the Rialto Theatre board. "The City Council tried to send a message without hitting them over the head with a hammer. They said, 'Come back to the negotiating table, or we'll go with condemnation.'"


ALL FIXED NOW?

You know that $3 billion budget crisis? Well, there's no more need to worry: The Arizona Legislature solved our problems earlier this week by taking out a big ol' payday loan.

Just kidding, just kidding—although that's not far from the truth. Rather than dealing with the roots of Arizona's financial crisis, lawmakers came together for a special session and unanimously agreed to keep the schools open, hang on to the health-care stimulus dollars and take care of a few other details.

And then they adjourned until further notice, without figuring out how to pay for it all.

Oddly, that doesn't mean the special session is over; it just means that it'll continue without any real lawmaking getting done. It's the legislative equivalent of the Korean War.

Still, the unanimous vote to resolve the immediate financial problems stands in stark contrast to the 170-day regular session that ended last week. The final result of that was a lousy budget that Gov. Jan Brewer promptly vetoed, creating a great deal of hostility in the process.

In a statement to the press, Senate President Bob Burns went so far as to say that Brewer's behavior was "incomprehensible," and added that "the governor is having problems managing the level of responsibility to which she has been elevated." Speaker of the House Kirk Adams issued a statement saying that Brewer's "decision to veto the education bill puts schoolchildren, hardworking teachers and employees in our public schools in jeopardy."

Republicans were so mad at Brewer, in fact, that they did the unthinkable: They made a deal with Democrats. Earlier this week, they spent exactly one day in special session, voting to pass the aforementioned bills that restored education funding (and added 2 percent for inflation) and ensured there would be enough health-care funding for the state to qualify for stimulus dollars. They also took care of a few other details.

Then lawmakers adjourned, probably until Labor Day.

The big problem: The current budget is out of balance by an estimated $2 billion. That means that the state will be spending money that it doesn't really have for the next two months.

Exactly how that will be resolved remains to be seen, but legislative leaders from both sides of the aisle say they'll be meeting this summer to try to hammer out a new deal.

It strikes us as fundamentally absurd that lawmakers couldn't work this out sometime within the first six months of the year, but maybe now there's a chance they'll find a way to bridge the funding gap without selling off the prisons and enacting tax cuts for the wealthy.


SPEAKING OF MONEY TROUBLES

The state's latest financial numbers show that the state remains in a world of hurt. In the month of May, the state collected $457 million, which was $238 million less than it collected in May 2008. Sales taxes dropped more than 21 percent compared to May '08, and income-tax withholding dropped nearly 20 percent.

That's the 16th straight month that sales-tax revenues have dropped. They've dropped by double-digits for the last seven months.

The big declines continue to come from taxes on car sales—down 32 percent compared to the prior year—and taxes on construction work, which dropped 42 percent compared to May 2008. General retail sales dropped about 7 percent.

In the first 11 months of the fiscal year, state revenues have dropped $1.184 billion compared to the previous year.

In short: Arizona hasn't hit the bottom yet.

But there's a bit of good news: More Arizonans are playing the lottery! Tickets sales were up $6.9 million over May 2008.


SCRAMBLEWATCH 2010: WILD AND CRAZY RUMORS

Is Grant Woods, moderate Republican and former state attorney general, really thinking about running for governor as an independent?

And is J.D. Hayworth, a former Republican congressman and current radio talk-show host, really getting set to challenge Sen. John McCain?

Find early and late-breaking Skinny at our new daily dispatch, The Range, at blog.tucsonweekly.com.

More by Jim Nintzel

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