The Tucson City Council decided to delay a vote on an agreement for a proposed $10 million downtown arts and entertainment development plan at Tuesday night’s city council meeting.

Council members hoped that the Rialto Theatre Foundation and Downtown Tucson Development Company will achieve a wording they can agree on by the July 7 meeting.

The Rio Nuevo Multipurpose Facilities District owns The Rialto Theatre, but not the areas that flank it nor the green room in the building behind it. The development company owns these spaces, not the Rialto Theatre Foundation. But the foundation manages the theatre, giving them big stakes in the agreement.

The foundation didn’t accept the agreement as it was worded, a point Rialto Theatre Foundation Board President Michael Crawford made clear at the meeting.

“”Under this current agreement, they (the development company) don’t have to do the Rialto Theatre part. They don’t,”” he said.

The foundation wanted Rio Nuevo to own the spaces that are so crucial to the Rialto’s operation, including the bathrooms – but the development company wanted to continue to own these spaces. Negotiations broke down at this point.

“”We thought we were close to a deal, but last Wednesday they simply walked away from the table,”” Crawford said.

The current agreement proposed that the development company leases the green room to Rio Nuevo for five years rent-free, then works out a market-value option after that. However, the developers could back out of the deal by taking a penalty – a loss of land credits that would have been given to them by the city.

Addressing the council members, developer Scott Stiteler from Downtown Tucson Development Company said, “”If you vote for us, we’re ready to go. … If you vote against us, that’s okay but it does send a message. … Boards on the buildings stay put.””

Council Member Steve Leal motioned to put the vote on hold due to what he called the “”subtext of tension that has developed between the theater and the developers.””

“”We need to understand that we’re setting up a forced marriage between people who aren’t compatible,”” Leal said. “”I’m optimistic that we can get a better balance in this.””

Council Member Nina Trasoff reminded the council members about the possible fallout of putting off the vote with the development company walking away from the table for good.

After the meeting, Council Member Karin Uhlich remained optimistic about the agreement.

“”I think that there’s a clear framework of intention in this document that can be brought to fruition,”” Uhlich said. “”I think that the Rialto will benefit and the investors will see the kind of partnership that they’re looking for, and I think we’ll get there in a few weeks.””

Despite the delay in the vote, Council Member Regina Romero noted the progress made in the agreement.

“”I think we can get there and I hope that we all stay at the table,”” Romero said. “”The pre-development agreement was so much more convoluted. … We’ve come to a place where it’s so much more simple.””

Not everyone feels so optimistically about the delay on the vote.

“”I think it was a perfect example of why nothing gets done in this city. It’s just a travesty to me that they could walk away from opportunity to develop downtown,”” said Tucson architect Sonya Sotinsky when asked about Tuesday’s decision.

“”It’s so disturbing to me that they won’t take the plunge and they want everyone to be happy,”” she said. “”Everyone in the world can’t be happy all the time.””