Thanks for all the replies. I ended up having 2 - 1/2" diameter rods made up at work with threads on both sides and I also ground some of the aluminum away where it was hitting on the water pump.
Aluminum ground where the bolt was hitting (sorry, it's the shiny spot):
Paint touched up and new 1/2" rods installed to replace the original 3/4" diameter sleeve
Finished product, the one side still flares out a little bit from the 1/2" rod rubbing:
Thanks again for all the replies and if some one thinks something is assembled wrong please let me know!! I purchased the boat with the motor out and unassembled so I'm not quite sure how it goes.