Update, April 25, 2012: The City of Austin announced April 25 the signing of a contract with the RunTex Foundation to put on the 2012 Trail of Lights Festival.

The city canceled the holiday celebration–an Austin tradition since 1965–in 2010 and 2011 due to a lack of funding.

The Run Tex Foundation has planned a fundraising campaign to raise the estimated $700,000 to cover the festival's costs.

Original article, February 27, 2012:

An announcement was made Feb. 25 about a proposed deal between the city and RunTex Foundation. The foundation would lead a fundraising campaign to cover all aspects of the event, which it estimates will cost at least $700,000.

Mayor Lee Leffingwell said Paul Carrozza of the RunTex Foundation approached him with the idea.

"He—like a lot of people—was saddened by the loss of the Trail of Lights due to budget cuts," Leffingwell said. "It was a million-dollar item out of the Parks [and Recreation Department] budget and with the recession, we didn't have much choice."

Funding for the event was cut from the City of Austin's 2010–11 budget. Efforts to raise funds by outside organizations fell short, resulting in the cancelation of the festival in 2010 and 2011. BrightBlue Marketing had been appointed by city staff to handle the 2011 event.

Leffingwell said fundraising efforts will begin no later than mid-March to ensure there is enough time to raise the money needed.

"We are confident that the Austin community will come together to raise the resources necessary to make this happen," Carrozza stated in a news release.

The proposal with the RunTex Foundation calls for the reinstatement of all the original aspects of the festival as well as some additions, such as a 5K run. The event would last eight nights at no cost to the public.

Leffingwell said Carrozza came to him with a plan he had worked on with city staff and retirees who had been in involved with the festival in past years. Leffingwell said he felt confident in the ability of Carrozza, who has run many successful community events.

"I know Paul pretty well, and if anyone can make it work, it's him," Leffingwell stated.

The foundation also proposed to cover all of the city's direct costs, including staff and department time and event construction. The foundation would handle recruitment and management of temporary staff and volunteers, parking, litter control and security, and in turn, the city would waive all event-related permits, park-use and street-closure fees and provide the use of available event equipment and displays.

The Austin City Council is scheduled to discuss the proposal at its March 1 meeting.