DMC's $39.6 million spending plan for 2024 includes $10 million to attract private investors
Sep. 28—ROCHESTER — Nearly a third of state Destination Medical Center funds spent in 2024 are expected to help attract new private investment.
"It's an ability to invest in the future," Rochester Deputy City Administrator Cindy Steinhauser said of the funding outlined in the planned 2024 DMC budget.
The proposed $39.6 million capital improvement plan calls for the use of $31.5 million in state DMC infrastructure and transit funds, with $10 million set aside for strategic redevelopment.
Catherine Malmberg, the DMC Economic Development Agency's director of public infrastructure and development strategy, said the funds will be added to $10.8 million already in reserve to respond to requests for financial support as they emerge.
"There are several projects that are currently in the pre-development process in the downtown neighborhood," she said of projects that could be supported by the funds. "Some of those are workforce housing projects; some of them are biomed tech."
The strategic redevelopment fund offers the city and DMC EDA a chance to help private investors fill financial gaps when projects address DMC goals. Any project receiving funding would require approval from the state DMC Corp. board, as well as the Rochester City Council.
Patrick Seeb, DMC EDA executive director, said one example of such support is funding provided to
Bryk on Broadway Apartments
to help ensure the developer could create housing that is affordable for residents earning 50% to 80% of the area median income.
He said the funds set aside for next year are also likely to help build laboratory space that will be needed to attract biomedical and tech companies to the area.
The DMCC board unanimously approved the 2024 budget and spending plan on Thursday, which will be reviewed by the Rochester City Council during its meeting at 7 p.m. Monday in council chambers of the city-county Government Center.
The second-largest use of state DMC funds next year is the
planned rapid-transit project
slated to provide dedicated bus service along Second Street Southwest, with frequent, dedicated stops along a 2.6-mile route.
The 2024 spending plan provides $9.3 million in DMC infrastructure and transit funds to reconstruct parts of Second Street as part of an anticipated $56.1 million state match to federal funds for the $143.4 million project.
Limited local funds are being used for the project, and an agreement with Mayo Clinic has the health care provider funding operations once service starts, which could be as early as 2026.
Other project funding outlined in the 2024 DMC capital improvement plan includes:
* $1 million for the
Chateau Theatre's
heating and air-conditioning upgrades.
* $1 million for advanced design efforts for
redevelopment of city-owned property along the Zumbro River,
if the city is able to secure state funding for the estimated $52.9 million project.
* $500,000 for design of public spaces near St. Marys Hospital to enhance transit-related work already being planned.
* $4 million for design and construction of a
Sixth Street bridge
over the Zumbro River, which is also being supported by a $19.9 million federal grant.
* $7.2 million to expand a
downtown district energy system
that would allow private buildings to connect and help support a geothermal system being installed for city-owned buildings.
* $1.5 million for planned downtown sewer upgrades.
"These projects reach throughout the DMC district," Seeb said of the area that stretches from the Mayo Clinic west parking lot on Second Street Southwest to just beyond the Zumbro River.
In addition to project funding, the 2024 spending plan includes $5 million for DMC operations, which includes $2.8 million for the DMC EDA and nearly $1.1 million for city employees responsible for DMC project management.
The bulk of the operation funds come from the city's contribution to the $585 million in public funds that are part of the $6.1 billion DMC initiative.
In addition to the city funding, Mayo Clinic is slated to contribute $1.5 million to DMC EDA operations next year.
"It's a very strong capital proposal," DMCC Chairwoman Pamela Wheelock said.
The budget must also be approved by the Rochester City Council.
If the council doesn't approve the budget, the spending plan is sent back to the DMC EDA for potential tweaks. The council is not able to make its own changes to the DMC budget.
If budget revisions are suggested, they will be reviewed at the next DMCC board meeting, which is slated for Nov. 17.
