A bill making sure Destination Medical Center's administrative costs don't end up on Rochester property taxpayers' bills in the future sailed through a House committee today.
Rep. Kim Norton, DFL-Rochester, is sponsoring a bill that would require any money spent on administrative costs related to DMC count towards the city's required $128 million match. That's significant because administrative costs related to the Destination Medical Center Corp. and the DMC's Economic Development Agency are projected to be $21 million over the next five years.
Norton told members of the House panel that the city of Rochester is already committed to spending $128 million on the $6 billion economic development initiative — more than city leaders had originally envisioned when the bill was proposed in 2013.
"It just is not fair to the citizens of Rochester, who already got a surprise of $128 million in additional taxation, to just keep adding to that," she said.
In 2013, the Minnesota Legislature approved a $585 million public subsidy package to pay for infrastructure upgrades associated with Mayo Clinic's planned $3.5 billion expansion known as Destination Medical Center.
Besides making sure Rochester gets credit towards its required local match for spending on administrative costs, the bill also gives the city additional options for paying those fees. It would enable city leaders to use funding options authorized under the DMC law to pay for those costs, including extending the city's half-cent sales tax or raising the sales tax by a quarter of a cent.
No one spoke out against the bill during the hearing. Rep. Peggy Scott, R-Andover, did question why this issue wasn't taken care of in the original legislation. Norton said initially the thought was that the privately-run EDA's budget would be funded primarily with private money, but it appears the city of Rochester will actually be funding a large portion of the EDA's budget.
Members of the House Job Growth and Energy Affordability Policy and Finance Committee approved Norton's bill on a voice vote. It now heads to the House Taxes Committee for a hearing. Sen. Dave Senjem, R-Rochester, is sponsoring a similar bill in the Senate.