Manteca is returning $2.8 million to Uncle Sam.

And it is because spending ‘free’ federal money for the sake of not losing it doesn’t appeal to Manteca Councilman Vince Hernandez.

Hernandez pulled the item off the consent calendar Tuesday regarding the McKinley Avenue-120 Bypass interchange project. He started a discussion that ended in a unanimous council vote to return $2.8 million to the federal government with a “thanks but no thanks” message attached.

The $2.8 million was secured in 2005 by then Congressman Richard Pombo to match $400,000 in local growth funds collected for transportation projects for design work for the proposed interchange. The council last month approved a $1.5 million contract with Rajappan & Meyer Consulting Engineers to proceed with the design in order to start spending the money prior to a deadline that is coming up before year’s end to either spend it or lose it.

The item on Tuesday’s agenda was a cooperative agreement with Caltrans regarding performing independent quality assurance over the design work at no charge to the city.

Hernandez said he had a problem with the”use it or lose it mentality.”

“It is almost like we are doing this for the wrong reason,” Hernandez said.

Councilman John Harris picked up on Hernandez’s opening and questioned the need for making the McKinley Avenue interchange a priority over the city’s four other interchange projects. Those include a new $100 million plus interchange on Highway 99 toward Ripon and upgrading the three existing 120 Bypass interchanges.

Harris noted that the concept of a major employment center known as Tara Business Park similar to Hacienda Business Park in Pleasanton south of the proposed interchange was a “hot item” 20 years ago but the market-driven development patterns have shifted.

Councilman Steve DeBrum said he understood the rationale for the interchange and the need to plan for growth but wondered where the city would be getting the money to complete the project.

In the end, Mayor Willie Weatherford made the motion to ditch the design work.

The decision Tuesday night did not pull the plug on the interchange in its entirety.

Just six months ago, the council adopted a citywide traffic plan that included the McKinley Avenue interchange as a key component.

What Tuesday’s vote did not answer was:

• whether the city would owe the consultant any money for breaking a contract the council has already authorized although it has not been executed.

• what impact it will have on the future planning for the McKinley Avenue Express that will be addressed in 2013 when the next state-mandated general plan update rolls around.

• how Lathrop would provide access to a major residential and business park project they are planning on the northwest quadrant of the proposed interchange.

McKinley has been on the city’s development radar for over 15 years.

Four residents south of the 120 Bypass impacted by either the interchange or the envisioned McKinley Expressway that would swing east to connect to a new interchange Highway 99, asked questions of the council in how the interchange would impact the expressway project.

Richard Hansen - a Manteca resident who doesn’t live south of the 120 Bypass - chided the council for even considering the project.

“All your free gifts (from the federal government) end up costing us taxpayers’ money,” Hansen said.

Had the city proceeded, there may have been enough money left in the $3.2 million - $2.8 million from Uncle Sam and $400,000 in growth fees - after the design work was done to acquire property for the interchange but after that, there is no identified funding to build the interchange that could cost more than $20 million.