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9/25/2018 DMCC Board of Directors Meeting - Agenda and Meeting Packet
DESTIN ATION MEDICAL CENTER CORPOR ATION (DMCC) BOARD OF DIRECTORS MEETING 9:30 A.M. TUESDAY, SEPTEMBER 25, 2018 MAYO CIVIC CENTER - ROCHESTER 1 DESTINATION MEDICAL CENTER CORPORATION (DMCC) BOARD MEETING Tuesday, September 25, 2018 9:30 A.M. AGENDA Page I. Call to Order II. Roll Call III. Approval of Agenda………………………………………………………………………………………………………………………………….1 IV. Approval of Minutes: June 28, 2018……………………………………………………………………………………………………….3 V. Public Comment Period VI. Chair’s Report VII. DMC Metrics: Update……………………………………………………………………………………….7 VIII. 2019 DMCC Funding Request Approval A. 2019 EDA Work Plan and Budget……………………………………………………………….9 B. Capital Improvement Program…………………………………………………………………...23 C. Working Capital Loan……………………………………………………………………………..25 D. 2019 DMCC Budget……………………………………………………………………………….33 Resolution A: Approving the 2019 DMCC Funding Request and Authorizing Transmittal……..35 IX. DMCC Form 990; Annual Charitable Organization Report (Presenter: Craig Popenhagen, CliftonLarsonAllen)………………………………………………………………………………………….37 Resolution B: Approving the 2018 State of Minnesota Charitable Organization Annual Report and 2017 Form 990…………………………………………………………………………………………85 X. Project Updates (City of Rochester, EDA) A. Status of Private Development Projects Receiving Prior Approval…………………………87 B. Status of Capital Improvement Plan (CIP) Public Infrastructure…………………………….97 C. Discovery Square Subdistrict Update (Presenters: Chris Schad, EDA; Jeremy Jacobs, Mortenson)………………………………………………………………………………………..101 D. Public Realm 1. Chateau Theatre……………………………………………………………………………..107 2. Heart of the City………………………………………………………………………………109 3. Discovery Walk…….………………………………………………………………………....110 4. Saint Marys Place………………………………………………………………………….....111 E. Transportation Planning……………………………………………………………………...…..113 XI. EDA Update……………………………………………………………………………………………..……117 XII. Discovery Square Trademark……………………………………………………………………...……….141 Resolution C: Authorizing EDA as Agent for Discovery Square Trademark Licensing on behalf of DMCC………………………………………………………………………………………………143 Page 2 XIII. DMCC Insurance: League of Minnesota Cities Insurance Trust (LMCIT) Waiver……………………147 XIV. DMCC 2018 Budget Year to Date Update………………………………………………………………..149 XV. DMCC 2019 Regular Meeting Schedule Resolution D: Approval of 2019 Regular Meeting Schedule…………………………………...……….153 XVI. Meeting Schedule: A. Next Regular Meeting: November 13, 2018 at 9:30 A.M. B. Next Executive Committee Meeting: March 21, 2019 at 9:30 A.M. XVII. Adjournment DESTINATION MEDICAL CENTER CORPORATION (DMCC) BOARD MEETING Thursday, June 28, 2018 9:30 A.M. MINUTES I.Call to Order. Chair R.T. Rybak called the meeting to order at 9:30 a.m. at the Mayo Civic Center, Suite 101, located at 30 Civic Center Drive SE, Rochester, MN 55904. II.Roll Call. Chair R.T. Rybak, Vice Chair Ardell Brede, Commissioner Jim Bier, Council Member Mark Hickey, Paul Williams, and Dana Bailey were present. III.Approval of Agenda. Commissioner Bier moved approval of the Agenda. Mayor Brede seconded. Ayes (6), Nays (0). Motion approved. IV.Approval of Minutes. Mayor Brede moved approval of the Minutes of the March 22, 2018 meeting. Mr. Williams seconded. Ayes (6), Nays (0). Motion approved. V.Public Comment Period. No members of the public provided comment. VI.Chair’s Report. Chair Rybak reported on the significant efforts being made to add to Rochester’s affordable housing stock, noting that the DMCC is strategically involved in this collaborative initiative being sustained by the City of Rochester, Olmsted County, Mayo Clinic and the Rochester Area Foundation. A.2019 DMCC Funding Request: Process and Timeline. Lisa Clark, Executive Director of the EDA, reported on the 2019 DMCC Funding Request process. Chair Rybak asked for volunteers to informally review the funding request. B.Election of Treasurer. Chair Rybak announced that Mr. Campbell has resigned as Treasurer, and opened nominations for the office of Treasurer. Mayor Brede moved to nominate Commissioner Bier. Council Member Hickey seconded. Ayes (6), Nays (0). Motion approved. VII.DMC Metrics: Update. Chair Rybak stated that the DMC metrics dashboard is a useful tool to evaluate progress towards the achievement of the DMC development plan goals. Ms. Clarke stated that several of the metrics are updated annually, and showed how potential new projects would positively affect the metrics. Chair Rybak indicated that these data could be useful when making policy choices. Mr. Williams asked that household income and sales tax revenue data be presented to the Board; Chair Rybak agreed and asked that the wage rates for added jobs also be presented. VIII. Consent Agenda. A.2018 Meeting Schedule: Revised Dates. Resolution A: Revising the 2018 DMCC Board Regular Meeting Schedule B.Revised Certification of Expenditures to DEED Resolution B: Ratifying and Confirming the Revised April 1 Report to DEED Pursuant to Statute Mr. Williams moved approval of the Consent Agenda. Mayor Brede seconded. Ayes (6), Nays (0). Motions approved. 3 IX. DMCC Audit for Year Ending December 31, 2017 Craig Popenhagen of CliftonLarsonAllen presented the DMCC audit findings. Mr. Popenhagen stated that the reports are compiled in accordance with government accounting standards because the DMCC is a component unit of the City of Rochester for tax purposes. He stated that the audit opinion is “clean,” with no control issues and no Minnesota legal compliance findings. Council Member Hickey moved approval of the audit. Ms. Bailey seconded. Ayes (6), Nays (0). Motion approved. X. Project Updates. A.Status of Private Development Projects Receiving Prior Approval. Ms. Clarke provided several brief updates: the Titan Hilton is scheduled to open in April 2019, the Berkman is under construction and scheduled to open in May 2020, Urban on First broke ground in March of this year and is scheduled to open in 2019, and One Discovery Square is “topping off” today. B.Status of Capital Improvement Plan (CIP) Public Infrastructure. Brief updates on the progress of several CIP projects were presented. Mr. Williams asked how the capital improvement projects have been prioritized. Chair Rybak noted that in addition to capital improvement projects, DMC public funding must also consider public realm development and transportation investments. Patrick Seeb, Director of EDA Economic Development and Placemaking, stated that the DMC Development Plan includes a detailed list of potential public infrastructure projects. Because the identified needs exceed the value of all DMC public funding, the City and EDA staff recognize that additional financing sources will need to be relied upon. City Administrator Steve Rymer stated that prioritization of capital projects is key to ensuring that public infrastructure supports, and does not inhibit, private development opportunities. Chair Rybak noted that while all capital improvement projects are presented to the Board during its annual consideration of the DMCC funding request, it is important to understand how public realm and capital improvements can be complementary. He also described the unique financing tools provided to the DMC initiative by the DMC legislation. Commissioner Bier also highlighted the County’s tax authority, which is providing for transportation funding, as well. C.Project Approvals. Mr. Seeb described the effect that approval of all four proposed projects would have on various goal indicators. 1.Bloom Waterfront (Bloom International Realty LLC). Terry Spaeth, City of Rochester Development Director, noted the significant private investment and tax revenue increase that would result from the construction of the project. The project will provide 275 permanent and 400 construction jobs. Resolution C: Approving the Bloom Waterfront Project, with Conditions. Commissioner Bier moved approval of the resolution. Mr. Williams seconded. Ayes (6), Nays (0). Motion approved. 2.21 1st Street SW (Ryan Companies US, Inc.). Mr. Seeb described the proposed project. Mr. Spaeth stated that private investment totals more than $26 million and the completed redevelopment will generate an additional $200,000 in annual tax revenue while creating space for 115 more employees and 30 construction jobs. 4 Resolution D: Approving the 21 1st Street SW Project, with Conditions. Vice Chair Brede moved approval of the resolution. Council Member Hickey seconded. Ayes (6), Nays (0). Motion approved. 3.Holiday Inn Downtown (Hotel Indigo) Rochester (RHI Hotel JV, LLC). Mr. Seeb described the current structure and the proposed rebranding as a Hotel Indigo. Resolution E: Approving the Holiday Inn Downtown (Hotel Indigo) Rochester Project, with Conditions. Mr. Williams moved approval of the resolution. Ms. Bailey seconded. Ayes (6), Nays (0). Motion approved. 4.Hyatt House Civic + First Rochester (First Civic Center, LLC). Mr. Seeb described the project. Mr. Spaeth noted the private investment of $44 million will result in 38 permanent jobs and 257 construction jobs. Resolution F: Approving the Hyatt House Civic + First Rochester Project, with Conditions. Commissioner Bier moved approval of the resolution. Mr. Williams seconded. Ayes (6), Nays (0). Motion approved. D.Public Realm 1.Chateau Theatre. Aaron Parrish, Assistant City Administrator, described the status of the Chateau Theatre project, including approval of the interim use plan by the City’s Heritage Preservation Commission. 2.Heart of the City. Mr. Seeb reported that design development is progressing for First Avenue, Theatre Square, and the adjacent alleys. 3.Discovery Walk. Mr. Seeb stated that schematic design is complete, the development is being integrated with other infrastructure improvements, and staff are examining activation strategies and development opportunities. 4.Saint Marys Place. Mr. Seeb reported that schematic design is complete and community discussions continue. E.Transportation Planning. Chair Rybak thanked retiring City Engineer Richard Freese for his many years of service upon his retirement. Ms. Clarke then described recent progress and the actions being requested, including acceptance of the integrated transit studies and offering support for the City of Rochester’s grant applications. Mr. Freese noted that concept design and environmental review will be included in the next phase of work. Mr. Freese also stated that while the Board is being asked to accept the studies, further study is required, including the location of mobility hubs, the feasibility of decking over U.S. Highway 52, refinement of the bus rapid transit routes, and other issues. Mr. Freese will bring a more detailed implementation plan to the next Board meeting. Ms. Bailey asked if community outreach continues. Mr. Freese noted that staff have organized four open houses, multiple community presentations, and will offer a mobility hub design exercise at the June 28 “Thursday’s on First and Third” event. 5 1.Integrated Transit Studies Resolution G: Accepting Integrated Transit Studies Final Report, and Providing Direction for Additional Study and Recommendations. Mayor Brede moved approval. Ms. Bailey seconded. Ayes (6), Nays (0). Motion approved. 2.Support for City ‘s Application for Federal Funding Resolution H: Supporting the City of Rochester, Minnesota in its Application to the U.S. DOT of BUILD Transportation Grants. Commissioner Bier moved approval. Mr. Williams seconded. Ayes (6), Nays (0). Motion approved. XI. EDA Update A.Sustainability. Kevin Bright, EDA Energy and Sustainability Director, gave a sustainability update. Mr. Bright described efforts made to clarify energy and sustainability goals, expectations, and tools, including additions to the DMC Joint Application for Funding. Council Member Hickey noted that the McKnight Foundation suggested that energy efficiency investments ought to offer a full return on investment within eight years. Mr. Bright also noted that the energy and sustainability review being codified in the funding application is already in practice during the development review process. Mr. Seeb offered to supply a summary of energy and sustainability principles and practices that are incorporated into the project review process and individual development projects. B.Marketing Plan. Bill Von Bank, EDA Marketing and Communications Director, and Rob Rankin of Clarity Coverdale Fury provided a marketing plan update. Mr. Rankin noted that 2017 was the first full year of marketing the DMC initiative. Mr. Von Bank noted that DMC marketing efforts are now shifting from general awareness to lead generation and targeting of specific markets and audiences. DMC digital marketing efforts continue to be strong and outperform industry benchmarks. XII. DMCC 2018 Budget Year to Date Update. Commissioner Bier presented the year to date budget. XIII. Meeting Schedule: A.Next Regular Meeting: September 25, 2018 at 9:30 A.M. XIV. Adjournment. Mayor Brede moved to adjourn the meeting. Ms. Bailey seconded. Ayes (6), Nays (0). Motion approved. 6 DMC Dashboard DMC Growth vs. Projections DMC Investment By Year City & County Tax Revenues City of Rochester Job Growth 7 8 DESTINATION MEDICAL CENTER ECONOMIC DEVELOPMENT AGENCY DMC EDA 2019 Work Plan and Budget Summary 2019 DMC EDA Work Plan In 2019, the Destination Medical Center (“DMC”) initiative will focus on continuing robust economic development, further developing the DMC District and the continued implementation of programs and initiatives to transform America’s City for Health. The workplan reflects the roles and responsibilities described Minnesota state law, including development planning and promotion, development services, and marketing, outreach, and communications. Anchored by the DMC Development Plan and influenced by the engagement and participation of our stakeholders, the Destination Medical Center Economic Development Agency (“DMC EDA”) will pursue annual strategic objectives in order to achieve the goals of the DMC initiative. 2019 Strategic Objectives include: • Advance Heart of the City public and private developments • Activate Chateau Theatre, following renovations and repairs • Ensure successful launch of One Discovery Square and initiate Two Discovery Square planning and development • Discovery Walk interim prototyping deployed • Grow the business and entrepreneurial eco-system in Discovery Square • Set priorities for transportation plan and begin implementation of Phase I projects • Strengthen real estate developer and finance/equity partner relationships • Identify, refine, and diversify public and private financial investment tools • Engage the community in the implementation of the DMC development plan • Implement the DMC patient, visitor and community experience strategy • Execute local, regional, national, and international marketing and communications strategy • Provide leadership to advance environment and sustainability outcomes, including Americas City for Health 2019 DMC EDA Budget Request The enclosed budget, developed to achieve the strategic objectives identified in the 2019 DMC EDA work plan, has been prepared by DMC EDA staff with the advice and consultation of the DMC Corporation budget work group and City of Rochester elected leaders and staff. • The 2019 DMC EDA funding request to the City of Rochester of $2,571,406 represents a year- over-year increase in funding of $75,000, or approximately 3%. • The 2019 Mayo Clinic contribution towards the strategic operational expenses of the DMC EDA totals $1,276,632, which represents a year-over-year increase in funding of $4,412, or approximately 0.35%. The DMC EDA Board of Directors approved the proposed budget and work plan on September 14, 2018. 9 10 Destination Medical Center Economic Development Agency 2019 Workplan Updated: August 24, 2018 11 Executive Summary In 2019, the Destination Medical Center (“DMC”) initiative will focus on continuing robust economic development, further developing the DMC District and the continued implementation of programs and initiatives to transform America’s City for Health. Anchored by the DMC Development Plan and influenced by the engagement and participation of our stakeholders, the Destination Medical Center Economic Development Agency (“DMC EDA”) will co ntinue to pursue the Phase 1 and 20-year goals of the DMC initiative. Twenty year goals include: o Create a comprehensive strategic plan o Leverage the public investment of $585 million o Create approximately 35,000 new jobs o Generate approximately $7.5 - $8.0 billion in new net tax revenue o Achieve the highest quality patient, companion, visitor, employee, and resident experience To date, the DMC Corporation board of directors has made strategic investments in public realm planning and design, including Heart of the City and Chateau Theatre, Saint Marys Place, and Discovery Walk; the development of Discovery Square; transportation; energy and sustainability; targeted marketing; meaningful public engagement; and significant private development projects. These investments are direct examples of the successful implementation of the DMC Development Plan. This work plan outlines the objectives and allocates the resources necessary to capitalize on these public investments; continue to pursue private investment and development opportunities; implement business and workforce recruitment and retention activities; and exceed patient, visitor and resident experience expectations in order to achieve DMC’s twenty-year goals. To this end, several significant one-time activities and targeted new investments have been incorporated into the work plan, including: o Advancing Heart of the City public space for construction o Programming Discovery Square in support of new business development o Activating Chateau Theatre reuse 12 DMC EDA Statutory Role and Responsibilities The DMC EDA assists the Destination Medical Center Corporation (“DMCC”) and the City of Rochester (“City”) in implementing the development planning and promotion, development services, and marketing, outreach and communication activities required to achieve the goals of the DMC development plan. The DMC legislation identified several key responsibilities of the DMC EDA in addition to its role as an advisory agency to the DMCC and City. The 2019 DMC EDA work plan serves these responsibilities, which have been organized as follows: (A) development planning and promotion, (B) development services, and (C) marketing, outreach and communications. The specific statutory responsibilities are listed below: A.Development Planning and Promotion, including: o Drafting and implementing the development plan, including soliciting and evaluating proposals for development and evaluating and making recommendations to the DMCC and the City regarding those proposals o Seeking financial support for the DMCC, the City, and projects o Partnering with other development agencies and organizations, the city, and the county in joint efforts to promote economic development and establish a destination medical center o Supporting and administering the planning and development activities required to implement the development plan B.Development Services, including: o Developing and updating the criteria for evaluating and underwriting development proposals o Providing transactional services in connection with approved projects o Working with the corporation to acquire and facilitate the sale, lease, or other transactions involving land and real property o Assisting the DMCC or City and others in applications for federal grants, tax credits, and other sources of funding to aid both private and public development C.Marketing, Outreach, and Communications, including: o Facilitating private investment through development of a comprehensive marketing program to global interests o Developing patient, visitor, and community outreach programs o Preparing and supporting the marketing and promotion of DMC o Preparing and implementing a program for community and public relatio ns All objectives contained within this work plan address one or more of these statutory responsibilities, demonstrating the commitment of the DMC Corporation, City of Rochester, and DMC EDA to the DMC Development Plan and to the intent of the State Legislature and Governor indicated by the support and enactment of the DMC legislation. 13 Create a comprehensive Strategic plan with a compelling vision that harnesses the energy and creativity of the entire community Leverage the public investment to attract more than $5 Billion in private investment to Rochester and the region Create approximately 35,000 new jobs with workforce development strategies that support growth Generate approximately $7.5-8 Billion in new tax revenue over the next 35 years Achieve the highest quality of patient, companion, visitor, employee, and resident experience, now and in the future DMC Goals Economic Development Community Engagement Experience Marketing & Communications Energy & Sustainability DMC Priorities Discovery Square Heart of the CityTransportation With Mayo Clinic at its heart, the Destination Medical Center (DMC) initiative is the catalyst to position Rochester, Minnesota as the world’s premier destination for health and wellness; attracting people, investment opportunities, and jobs to America’s City for Health and supporting the economic growth of Minnesota, its bioscience sector, and beyond. DMC Mission 14 DMC Economic Development Agency 2019 Work Plan Updated: August 24, 2018 Timeline Status Lead or Participate 1 Build a strong business relationship between the Wells Fargo project and public realm Q1-Q4 Lead 2 New private development growth underway (execute development recruitment strategy using updated market research) Q1-Q4 Lead 3 Building renovation complete for Chateau with operator identified Q1-Q2 Participate Timeline Status Lead or Participate 1 Community embraced Heart of the City design (manage stakeholder group, manage design team, execute community engagement strategy) Q1-Q4 Lead Timeline Status Lead or Participate 1 Community embraced Chateau Theatre vision (grand opening and activate the Chateau and Theatre Square)Q1-Q4 Lead 2 Evaluate ideas and concepts that support HoC public space (2 prototypes to test and evaluate ideas)Q1-Q4 Lead 3 New retail strategies tested (introduce pop up retail opportunities)Q1-Q4 Lead Outcome DMC Priority: Heart of the City Objective A: Project Development- Includes design, development and/or operational activities that result in new buildings or infrastructure within the DMC District. Outcome Objective B: Public Realm- Includes design, development and/or operational activities that result in active use of public spaces within the DMC District. Outcome Objective C: Experience/Programming- Includes design and operational activities that result in increased use of public amenities and private development opportunities. 15 DMC Economic Development Agency 2019 Work Plan Updated: August 24, 2018 Timeline Status Lead or Participate 1 One Discovery Square: plan developed to have market rate shared office space, maker space, wet lab space available plus below‐market startup space available Q1‐Q3 Lead 2 Two Discovery Square: design completed and construction underway Q1‐Q4 Participate Timeline Status Lead or Participate 1Discovery Walk: interim prototyping deployed Q1‐Q4 Lead Timeline Status Lead or Participate 1 Community development: enable success of new businesses through intentional assimilation into the business and scientific community and introductions to key resources Q1‐Q4 Lead 2 Programming: implement social, scientific and business programming that ensures success in building community, encouraging startups, and equipping business leaders Q1‐Q4 Lead and Participate 3 Tenants: 1) One Discovery Square highly occupied; and 2) Business recruitment under way for all available spaces in the sub‐district. Q1‐Q4 Lead 4 Workforce: undergrad and grad school students are placed into internships with DS businesses via DMC workforce development strategy Q2‐Q4 Lead 5 Further develop the identity and ensure the consistent and appropriate use of ‘Discovery Square’ by licensing and managing the trademark on behalf of the DMC Corporation Q1‐Q4 Lead Outcome Outcome Outcome DMC Priority: Discovery Square Objective A: Project Development‐ Includes design, development and/or operational activities that result in new buildings or infrastructure within the DMC District. Objective B: Public Realm‐ Includes design, development and/or operational activities that result in active use of public spaces within the DMC District. Objective C: Business Development‐ Includes activities related to formation, recruitment, growth and/or retention of businesses and the ecosystem needed to support those businesses. 16 DMC Economic Development Agency 2019 Work Plan Updated: August 24, 2018 Timeline Status Lead or Participate 1 Complete Phase 1 design and planning exercises for transit and infrastructure projects Q1-Q4 Participate 2 Complete Phase 1 design and planning exercises for pedestrian and bicycle system Q1-Q4 Participate 3 Evaluate a lid concept for the northwest mobility hub identified in the Transit Studies Q1-Q4 Participate Timeline Status Lead or Participate 1 Integrate public realm and transportation design on 2nd Street Q1-Q4 Participate Timeline Status Lead or Participate 1 Develop a measurement and monitoring system for transportation plan Q1-Q4 Participate 2 Communicate changes effectively and celebrate successes and share with the community Q1-Q4 Lead 3 Identify the next bike share system for Rochester Q1-Q4 Lead 4 Continue to introduce new ways of thinking and technology through participation in state-wide autonomous vehicle research Q1-Q4 Lead 5 Engage the developer community in transit-oriented development policy Q1-Q4 Lead 6 Identify strategies to encourage alternative commuting habits through participation in the Transportation Management Association (TMA) Q1-Q4 Participate Outcome DMC Priority: Transportation Objective A: Project Development- Includes design, development and/or operational activities that result in new buildings or infrastructure within the DMC District. Outcome Objective B: Public Realm- Includes design, development and/or operational activities that result in active use of public spaces within the DMC District. Outcome Objective C: Experience/Programming- Includes design and operational activities that result in increased use of public amenities and private development opportunities. 17 DMC Economic Development Agency 2019 Work Plan Updated: August 24, 2018 Timeline Status Lead or Participate 1 Complete review of development projects as proposed Q1-Q4 Lead Timeline Status Lead or Participate 1 Strong developer relationships built (support and attend: Rochester Real Estate Summit; ULI; ICLV; RECON; ICSC; APA; TIAACREF) Q1-Q4 Lead 2 Opportunities identified to create new revenue streams for public infrastructure and operations Q1-Q4 Lead 3 New retail strategy developed for DMC District Q1-Q4 Lead Timeline Status Lead or Participate 1 Educate stakeholders and gain advocacy support (best practice research and site visit re.. Heart of the City and Discovery Walk design elements, transportation and retail) Q1-Q4 Lead Timeline Status Lead or Participate 1 Continue to identify and support community and regional partnerships that help to realize the vision of the DMC initiative (Chamber, RAEDI, SMIF, DEED, Greater MSP ect.) Q1-Q4 Lead 2 Continue to monitor and acknowledge new business activity and positive change in the DMC district though direct business and community engagement activities Q1-Q4 Lead 3 Build community awareness and ownership by hosting events that create opportunities for communicating progress, partnerships and future planning (4 Peace Plaza events, 1 annual meeting, DMC lobby talks) Q1-Q4 Lead 4 Develop visual acknowledgment of DMC private projects and the DMC presence in the public realm space Q1-Q4 Lead DMC Priority: Economic Development Objective A: Project Development- Includes design, development and/or operational activities that result in new buildings or infrastructure within the DMC District. Outcome Objective B: Business Development- Includes activities related to formation, recruitment, growth and/or retention of businesses and the ecosystem needed to support those businesses. Outcome Outcome DMC Priority: Economic Development: Community Engagement Objective A: Community Engagement- Includes establishment of a community engagement strategy that builds a community of stakeholders that trust the DMC vision. Outcome Objective C: Experience/Programming- Includes design and operational activities that result in increased use of public amenities and private development opportunities. 18 DMC Economic Development Agency 2019 Work Plan Updated: August 24, 2018 Timeline Status Lead or Participate 1 Implement DMC experience strategy that includes experience framework, score card and monitoring metrics collaboratively with experience partners Q1‐Q4 Lead 2 Determine and implement best practices in experience methodology Q3 Lead 3 Continue to implement new experience improvement projects in partnership with Mayo Clinic, Experience Rochester and Rochester Downtown Alliance Q1‐Q4 Lead Timeline Status Lead or Participate 1 Increase brand awareness and targeted lead generation via multi‐channel marketing campaign: local, regional and national international audiences Q1‐Q4 Lead 2 Implement subdistrict brand integration program starting with Heart of the City & Discovery Square (Ensure the consistent and appropriate use of the Discovery Square brand by licensing and managing the trademark on behalf of the DMC Corporation) Q1‐Q4 Lead 3 Provide leadership to Market Rochester Collaborative (community marketing collaborative group)Q1‐Q4 Lead 4 Content development, social media, website analytics, podcasts, event activation Q1‐Q4 Lead 5 Regional and national media placement and media tracking Q1‐Q4 Lead 6 Maintain regional and statewide communication, engagement and advocacy Q1‐Q4 Lead 7 Develop marketing asset inventory and media photo library development Q1‐Q4 Lead 8 Upgrade website Q1‐Q4 Lead Outcome DMC Priority: Economic Development: Experience Objective A: Experience‐ Includes implementing DMC patient, visitor, and community experience strategy that identifies the needs of the community while becoming the catalyst for change and fueling private sector and growth Outcome DMC Priority: Economic Development: Marketing & Communications Objective A: Marketing & Communications‐ Includes executing the state, national and international marketing and communications strategy to attract identified target audiences (investors, developers, bioscience companies and entrepreneurs) to Rochester, MN and elevate the DMC brand. 19 DMC Economic Development Agency 2019 Work Plan Updated: August 24, 2018 Timeline Status Lead or Participate 1 Assist with the development of housing inventory and promotion of affordable housing projects Q1-Q4 Participate 2 Accelerate environmental program progress Q1-Q4 Lead 3 Ensure development meets DMC environmental goals Q1-Q4 Lead 4 Meet DMC MBE/WBE participation targets Q1-Q4 Participate Timeline Status Lead or Participate 1 Finalize strategy and process to realize DMC vision of "creating America's City for Health"Q1-Q4 Participate 2 Grow voluntary energy benchmarking program Q1-Q4 Lead 3 Develop GHG reduction action plan to meet DMC and City GHG Goals Q1-Q4 Lead 4 Continue to introduce new ways of thinking and technology Q1-Q4 Lead 5 Identify a rating system to measure and benchmark sustainability success Q1-Q4 Lead DMC Priority: Economic Development: Sustainability Objective A: Project Development- Includes design, development and/or operational Outcome Objective B: Experience/Programming- Includes design and operational activities that Outcome 20 2019 OPERATING BUDGET DESTINATION MEDICAL CENTER ECONOMIC DEVELOPMENT AGENCY Total 2018 DMC Sales Tax and Mayo Clinic Contribution 2019 DMC Sales Tax Contribution 2019 Mayo Clinic Contribution Total 2019 DMC Sales Tax and Mayo Clinic Contribution YOY Total Budget Change (%) ABCD E 1 Payroll $1,531,218 $766,566 2 Benefits $113,145 $136,047 3Payroll Expenses $5,000 $6,600 $0 $6,600 32% 4 Transportation/Transit Subsidy $7,200 $8,160 $0 $8,160 13% 5 Reimbursements $0 $14,000 $0 $14,000 0% Subtotal $1,656,563 $931,373 $965,000 $1,896,373 14% 6Rent and Utilities $151,352 $1,320 $118,087 $119,407 ‐21% 7 Equipment Rentals/Furniture $0 $0 $0 $0 0% 8 Office Supplies/Consumables $18,000 $15,000 $0 $15,000 ‐17% 9 Room Rental $0 $0 $0 $0 0% 10 Postage, Shipping, Messenger, etc.$5,000 $1,500 $0 $1,500 ‐70% 11 Website, Drafting, Hosting $13,800 $0 $0 $0 ‐100% 12 IT Hardware and Support $30,080 $26,300 $0 $26,300 ‐13% 13 Miscellaneous Costs $2,720 $2,460 $0 $2,460 ‐10% Subtotal $220,952 $46,580 $118,087 $164,667 ‐25% 14 Print & Collateral $25,000 $46,000 $0 $46,000 84% 15 Outreach and Local Events $173,500 $150,300 $0 $150,300 ‐13% 16 Subscriptions and Memberships $3,572 $2,750 $0 $2,750 ‐23% 17 Conferences, Meetings, Travel & Participation $198,270 $72,500 $0 $72,500 ‐63% 18 Econ Dev Costs $553,875 $589,239 $193,545 $782,784 41% Subtotal $954,217 $860,789 $193,545 $1,054,334 10% 19 Legal Services $42,000 $40,232 $0 $40,232 ‐4% 20 Website Management and CRM $60,114 $29,500 $0 $29,500 ‐51% 21 Marketing Communications & Advertising $475,000 $400,000 $0 $400,000 ‐16% 22 Public Relations/Community Relations $75,000 $70,000 $0 $70,000 ‐7% 23 Contracted Support Staff $194,000 $115,000 $0 $115,000 ‐41% 24 Financial Reporting Services $25,780 $25,432 $0 $25,432 ‐1% Subtotal $871,894 $680,164 $0 $680,164 ‐22% 25 Insurance & Taxes $65,000 $52,500 $0 $52,500 ‐19% 26 Miscellaneous Costs / Contingency $0 $0 $0 $0 0% Subtotal $65,000 $52,500 $0 $52,500 ‐19% TOTAL BUDGET CHANGE BY SOURCE $3,768,626 $2,571,406 $1,276,632 $3,848,038 2% September 17, 2018 DMC EDA Staff Costs $965,000 $1,867,613 14% DMC EDA Operational Costs Economic Development Outreach & Support Professional Services Miscellaneous Costs 21 22 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 A B C D E F G H I J K L M N O P Q R S T U V Destination Medical Center 2019-2024 Capital Improvements Program Special Assessment Bonds = a Abatement District = ad DMC State Transit Aid c Electric Utility eu Federal Funds = f Flood Control Reserves = fr Food & Beverage Tax = fb Local Gov't Aid = ga General Obligation Bonds =go Lodging Tax lt MN State Aid - Streets = ms Operating Trfs - fr Storm Water = os Operating Trfs-fr General Fund = ot Operating Trfs-fr Sewer Utility = ow Private Funds =p Project Reserves r GO Revenue Bonds = rb Retained Earnings =re State Funds = s Sn/Sewer Availability Chg = sa Sales Tax DMC =sd State DMC Funds sm Sales Tax 2013 = st Storm Water Mgmt Chg = sw Tax Levy = t Traffic Improvement Dist Chg = td Tax Increments =ti Operating Trfs- fr Other Funds to Water Availability Chg = wa Water Utility = wu Sort Map #Project Description Proj #2019 2020 2021 2022 2023 2024 Administrative Sales Tax DMC - repayment of loan from Flood Control Reserves; 7 year repayment starting in 2018. 8605 1,200,000 sd 1,200,000 sd 1,200,000 sd 1,200,000 sd 1,200,000 sd 1,200,000 sd ITS Study Repayment 1,600,000 sd 1,600,000 sd 1,600,000 sd 1,600,000 sd 1,600,000 sd Contributions to DMC Corporation for DMCC expenses.8602 360,000 sd 365,000 sd 370,000 sd 375,000 sd 380,000 sd 385,000 sd Contributions to DMC Corporation for EDA expenses. 8602 2,500,000 sd 2,600,000 sd 2,700,000 sd 2,800,000 sd 2,900,000 sd 3,000,000 sd Transit/Transportation/Infrastructure study and project management. Management of all transit/transportation projects.8614 500,000 sd 100,000 sd c 25,000 ow 100,000 to 25,000 os 100,000 ow 25,000 wu 100,000 os 25,000 to wu City of Rochester Administrative costs for DMC project.8601 150,000 sd 150,000 sd 150,000 sd 150,000 sd 150,000 sd 150,000 sd Evaluation of Long Term CBD Maintenance, Operations, and Governance 100,000 sd 6,710,000 6,115,000 6,020,000 6,125,000 6,230,000 4,735,000 Public Realm Heart of the City: Theatre Square and 1st Avenue + Alley 8625 1,700,000 sm 6,000,000 sm 9,000,000 sm Discovery Walk Design and Implementation 800,000 2,000,000 sm 7,000,000 sm 7,000,000 sm Chateau Theatre Improvements 8613 1,400,000 sm 100,000 sm 100,000 sm 100,000 sm 100,000 sm 100,000 sm 3rd St SW reconstruction and design.8615 50,000 ti 300,000 ti St Marys Place Public Realm Implementation 3,000,000 sm 3,150,000 7,200,000 11,100,000 10,100,000 7,100,000 100,000 Infrastructure 4th Street Reconstruction 2,600,000 sm 904,270 a 2,192,853 ms 1,000,000 ow 668,138 wu Replace / upsize sanitary sewer along west side of 3rd Ave SE and along 1st Ave; from 4th St S to 1st St N. Includes new siphon under Zumbro River. (Use project #J7825 to track costs, and #J8626 as the funding source).8626 1,250,000 ow 500,000 ow 1,250,000 sm 3,000,000 sm 1st St NW Sanitary Sewer Diversion from 1st Avenue NW to Broadway 375,000 ow 375,000 sm Reconstruct 6th/7th Ave NW/SW from 2nd Street SW to Cascade Creek; includes replacement of undersized sanitary sewer and storm sewer to create downtown capacity. 2,400,000 sm 2,400,000 sm 250,000 sw 1,500,000 ow 700,000 a 1,500,000 os Reconstruct North Broadway Ave from Civic Center Drive to Zumbro River Bridge. Funds to be transferred from J2202 (TH63 turnback). 400,000 r 4,000,000 r 4,800,000 r 400,000 sm 4,000,000 sm 850,000 ow 1,250,000 wu 1,400,000 a SS1 13th Ave Sanitary and Storm Sewer Capacity Improvements from 2nd St SW to 2nd St NW. (Project is without subway tunnel option).8611 3,825,000 sm 1,675,000 ow Construct Sanitary Sewer Capacity Bypass on 2nd Street SE from Broadway to 1st Ave SE. 650,000 ow 650,000 sm 23 1 2 3 4 5 6 7 A B C D E F G H I J K L M N O P Q R S T U V Destination Medical Center 2019-2024 Capital Improvements Program Special Assessment Bonds = a Abatement District = ad DMC State Transit Aid c Electric Utility eu Federal Funds = f Flood Control Reserves = fr Food & Beverage Tax = fb Local Gov't Aid = ga General Obligation Bonds =go Lodging Tax lt MN State Aid - Streets = ms Operating Trfs - fr Storm Water = os Operating Trfs-fr General Fund = ot Operating Trfs-fr Sewer Utility = ow Private Funds =p Project Reserves r GO Revenue Bonds = rb Retained Earnings =re State Funds = s Sn/Sewer Availability Chg = sa Sales Tax DMC =sd State DMC Funds sm Sales Tax 2013 = st Storm Water Mgmt Chg = sw Tax Levy = t Traffic Improvement Dist Chg = td Tax Increments =ti Operating Trfs- fr Other Funds to Water Availability Chg = wa Water Utility = wu 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 103 104 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 128 129 130 131 132 133 134 135 136 137 138 139 140 141 142 143 144 145 146 147 Reconstruct 2nd Street SW from 11th Ave to 16th Ave. FHWA Federal funds secured (2019). Project includes subway crossing of 2nd St SW. 7802 - 1,650,000 f - 800,000 sm 1,500,000 a 275,000 to 150,000 wu 225,000 ow 1,500,000 ms 950,000 c 14,015,261 27,950,000 11,850,000 - - - Transit St. Mary's transit station- 2019: Continued design and planning; 2020 -2021: Improvements coordinated with DMC and 2nd Street rebuild; 2020: Phase 4-3B Pedestrian tunnel; 2021: Phase 4-3B Transit Center.2106 50,000 c 700,000 c 1,620,000 sm 200,000 f 2,800,000 f 6,480,000 f Phase I DMC Transit plan implementation 2019: 5 BRT-60' articulated electric buses at $1.3 million per unit plus charging infrastructure estimated at $1 million. Phase II - Purchase of 4 BRT -60' articulated electric buses. Local share- County sales tax 40% , State DMC funding 60%. Added solar panels on PWTOC for energy recovery in 2021. Competitive grant applications are being submitted in 2018 as approved by Council. 2091 1,500,000 c 1,040,000 c 200,000 c 6,000,000 f 4,160,000 f 800,000 f Arrive Rochester Implementation 250,000 sd 260,000 sd 270,000 sd 280,000 sd 290,000 sd 300,000 sd ITS Implementation 4,450,000 c 6,500,000 c 8,000,000 c 9,000,000 c 9,000,000 c 9,000,000 c Dedicated Bike Lanes on 3rd/4th Avenues and Center Street 1,100,000 sm 13,300,000 12,210,000 12,770,000 17,380,000 9,290,000 9,300,000 Total Cost 37,175,261 53,475,000 41,740,000 33,605,000 22,620,000 14,135,000 Sources of Funds Target Target Target Target Target Special Assessment Bonds a 1,604,270 a 1,400,000 a 1,500,000 a - a - a - Tax Abatements ad - ad - ad - ad - ad - ad - DMC Transit Aid (State Funding and County Match)c 5,950,000 c 6,000,000$ 7,590,000 c 8,000,000$ 9,850,000 c 9,000,000$ 9,000,000 c 9,000,000$ 9,000,000 c 9,000,000$ 9,000,000 c 9,000,000$ Electric Utility eu - eu - eu - eu - eu - eu - eu Federal f 6,000,000 f 4,360,000 f 5,250,000 f 6,480,000 f - f - f Flood Control Reserves fr - fr - fr - fr - fr - fr - fr General Obligation Bonds go - go - go - go - go - go - go Local Government Aid ga - ga - ga - ga - ga - ga - ga Municipal State Aid for Streets ms 2,192,853 ms - ms 1,500,000 ms - ms - ms - ms Operating Transfer - fr Storm Water Utility os 100,000 os 1,525,000 os - os - os - os - os Operating Transfer - fr General Fund ot - ot - ot - ot - ot - ot - ot Operating Transfer - fr Sewer Utility ow 2,350,000 ow 5,575,000 ow 225,000 ow - ow - ow - ow Private Funds p - p - p - p - p - p - p Passenger Facility Charges pc - pc - pc - pc - pc - pc - pc Project reserves r 400,000 r 4,000,000 r 4,800,000 r - r - r - r General Obligation Revenue Bonds rb - rb - rb - rb - rb - rb - rb Retained Earnings re - re - re - re - re - re - re State s - s - s - s - s - s - s Sewer Availability Charges sa - sa - sa - sa - sa - sa - sa State Loan Fund sl - sl - sl - sl - sl - sl - sl Sales Tax 2013 st - st - st - st - st - st - st Sales Tax DMC sd 6,660,000 sd 6,000,000$ 6,275,000 sd 6,000,000$ 6,290,000 sd 6,000,000$ 6,405,000 sd 6,000,000$ 6,520,000 sd 6,000,000$ 5,035,000 sd 6,000,000$ State DMC Funds sm 10,850,000 sm 9,863,227$ 20,350,000 sm 13,438,227$ 11,900,000 sm $17,013,227 11,720,000 sm $20,588,227 7,100,000 sm $24,163,227 100,000 sm $27,738,227 Plant Investment Fee pi - su - su - su - su - su - su Storm Water Area Mgmt Charge sw 250,000 sw - sw - sw - sw - sw - sw Tax Levy t - t - t - t - t - t - t Traffic Improvement District Fees td - td - td - td - td - td - td Tax Increment ti 50,000 ti 300,000 ti - ti - ti - ti - ti Operating Transfer - Other Funds to 100,000 to 25,000 to 275,000 to - to - to - to Water Availability Charges wa - wa - wa - wa - wa - wa - wa Water Utility wu 668,138 wu 1,275,000 wu 150,000 wu - wu - wu - wu - - - f - - - - - - - - - - - - - Total Sources of Funds 37,175,261 52,675,000 41,740,000 33,605,000 22,620,000 14,135,000 24 DMCC REQUEST FOR EXTENSION OF WORKING CAPITAL LOAN FOR 2019 To: City of Rochester, Minnesota (the “City”) 1. The undersigned authorized representative (the “Representative”) of the Destination Medical Center Corporation (“DMCC”) hereby authorizes and requests an extension of the Term of the Working Capital Loan Agreement (DMCC-City), dated April 30, 2015, by and between the City and the DMCC (the “Agreement”) and renewals of the DMCC Note and the EDA Note, in the amount and on the date specified below, in order to pay certain DMCC Eligible Expenses and to provide the EDA Tranche to pay certain EDA Eligible Expenses, pursuant to the terms and conditions of the Agreement. Capitalized terms not otherwise defined herein shall have the meanings given them in the Agreement. 2. The Representative certifies that (i) attached as Exhibit A is a true and correct annual reconciliation of the DMCC Tranche Advances made through August 31, 2018 and the DMCC Eligible Expenses paid from such Advances, as required by Section 2.6 of the Agreement; (ii) each item for which the DMCC sought payment in Exhibit A was a DMCC Eligible Expense; and (iii) the Advances received by the DMCC have not exceeded the limitations set out in Section 2.4(a) of the Agreement. 3. The Representative further certifies that attached as Exhibit B is a true and correct copy of the EDA Request for Extension of the Working Capital Loan for 2019. 4. The DMCC hereby requests an extension of the Agreement Term and renewals of the DMCC Note and the EDA Note, in the amount of $1,000.00 as the DMCC Tranche Advance and in the amount of $50,000.00 as the EDA Tranche Advance, as such amounts may be adjusted by the City pursuant to Section 2.8(c) of the Agreement, for payment of DMCC Eligible Expenses and, as to the EDA Tranche, for payment of EDA Eligible Expenses. 5. The Representative further certifies that no portion of the amount requested in paragraph 4 above constitutes a DMCC Excess Request under Section 2.3 of the Agreement. 6. The Representative further certifies that this statement and all exhibits and attachments hereto, and documents furnished in connection herewith, shall be conclusive evidence of the facts and statements set forth herein and shall constitute full warrant, protection, and authority to the City for its actions taken pursuant hereto. Dated: ________________, 2019 Authorized DMCC Representative 1097333.DOCX 25 EXHIBIT A: RECONCILIATION OF DMCC TRANCHE ADVANCES Through August 31, 2018 26 DMCC Bank Account Beginning Bank Balance 1,025.18 1,000.00 1,000.00 1,000.00 1,000.49 1,000.35 1,000.40 1,000.42 1,000.59 1,000.00 1,000.00 1,000.24 DMCC Bank Charges 98.16 101.63 104.75 102.05 106.31 104.16 102.72 103.41 104.64 103.06 106.27 105.84 Adjustments -bank fees returned 103.71 Adjustments -change in amount Interest Earnings 0.30 0.88 0.12 1.09 0.79 0.39 0.58 0.61 0.44 1.26 0.70 1.41 EDA Funding Requested 114,704.02 298,304.90 210,721.47 257,495.15 329,186.49 114,215.96 190,121.53 197,402.07 181,761.03 227,876.00 138,906.30 236,582.10 Actual Funded 114,776.99 298,405.65 210,826.10 257,596.60 329,291.87 114,319.78 190,223.69 197,505.04 181,760.93 227,977.80 139,012.11 236,686.37 Difference 72.97 100.75 104.63 101.45 105.38 103.82 102.16 102.97 (0.10) 101.80 105.81 104.27 Ending Bank Balance 1,000.29 1,000.00 1,000.00 1,000.49 1,000.35 1,000.40 1,000.42 1,000.59 1,000.00 1,000.00 1,000.24 1,000.08 Reconciling Items Interest {0.29) (0.49) (0.35) (0.40) (0.42) (0.59) (0.24) {0.08) Bank Fees Adjustments Net 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 EXHIBIT A DMCC Request for Extension of Working Capital Loan for 2019 27 DESTINATION MEDICAL CENTER ECONOMIC DEVELOPMENT AGENCY Approving the 2019 DMC EDA Funding Request and the Extension of Working Capital Loan BACKGROUND RECITALS WHEREAS, the Destination Medical Center Corporation ("DMCC") must adopt an annual Funding Request and Five Year Capital Plan. The DMCC Funding Request includes the DMCC annual budget, the Destination Medical Center Economic Development Agency ("EDA") annual budget, and support costs incurred by the City of Rochester; and WHEREAS, the EDA has submitted an EDA Request for Extension of the Working Capital Loan, that the Loan Documents be extended for 2019 in the amount of $50,000, as such amount may be adjusted by the City pursuant to Section 2.8(c) of the Agreement, and has provided the required annual reconciliation of advances and eligible expenses paid from such advances. RESOLUTION NOW, THEREFORE, BE IT RESOLVED, by the Destination Medical Center Economic Development Agency Board of Directors that the 2019 EDA Funding Request, the Five Year Capital Plan, and the EDARequest for Extension of the Working Capital Loan for 2019, are approved. Zio President EXHIBIT B DMCC Request for Extension of Working Capital Loan for 2019 28 EDA REQUEST FOR EXTENSION OF WORKING CAPITAL LOAN FOR2019 To: Destination Medical Center Corporation City of Rochester, Minnesota 1.The undersigned authorized representative (the "Representative") of the DestinationMedical Center Economic Development Agency ("EDA") hereby authorizes and requests an extension of the Term of the Working Capital Loan Agreement (DMCC-EDA), dated April 30, 2015, by and between the Destination Medical Center Corporation ("DMCC") and the EDA (the "Agreement"), and a renewal of the EDA Note, in the amount and on the date specified below, in order to pay certain EDA Eligible Expenses pursuant to the terms and conditions of the Agreement. Capitalized terms not otherwise defined herein shall have the meanings given them in the Agreement. 2.The Representative certifies that (i) attached as Exhibit A is a true and correct annual reconciliation of the Advances made through July 31, 2018 and EDA Eligible Expenses paid from such Advances, as required by Section 2.6 of the Agreement; (ii) each item for which the EDA sought payment in Exhibit A was an EDA Eligible Expense; and (iii) the Advances received by the EDA have not exceeded the limitations set out inSection 2.4(b) of the Agreement. 3.The Representative hereby requests an extension of the Agreement Term and a renewal of the EDA Note through the period December 31, 2019, in the Maximum Aggregate EDA Advances amount of $50,000, as such amount may be adjusted by the City asprovided in Section 2.8(c) of the Agreement, for payment of EDA Eligible Expenses pursuant to the terms and conditions of the Agreement. 4.The Representative further certifies that no portion of the amount requested in paragraph 3 above constitutes an EDA Excess Request under Section 2.3 of the Agreement. 5.The Representative further certifies that this statement and all exhibits and attachmentshereto, and documents furnished in connection herewith, shall be conclusive evidence of the facts and statements set forth herein and shall constitute full warrant, protection, andauthority to the DMCC for its actions taken pursuant hereto. Dated: J;/ /'Yyt,.. · , 2018 A.� 29 DMCEDA Operating Account Reconciliation of Bank Balance to Advance Total Bank Balance Date: 8/31/2018 Balance per Bank Add: Less: Advance in transit for expense cleared bank or expenses not yet requested- Receivable Receivable BlueCross BlueShield Advance for expenses not cleared: Outstanding check Outstanding check Outstanding check Outstanding check Outstanding check Outstanding check Misc CCC Advance Total reconciled $42,946.23 $ 1,032.15 City -Payroll 8/10 $ 1,010.62 City-Payroll 8/24 $ 6,591.76 $ (360.59) $ (424.67) $ (106.78) $ (242.20) #5271 $ (99.19) $ (191.51) KB ER128 $ (155.82) remaining credit card credit $50,000.00 EXHIBIT A EDA Request for Extension of Working Capital Loan for 2019 30 DMC EDA Operations Account Rollforward Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Beginning balance 18,862.53$ 33,341.02$ 4,471.09$ 20,594.63$ 15,773.21$ 16,706.67$ 49,151.79$ 40,841.96$ 24,586.27$ 20,202.88$ 16,824.01$ Transfer from MAP account Transfer from Events account 4,115.63 3,975.63 4,102.41 4,242.41 4,815.88 263.89 4,235.88 4,128.59 3,889.50 3,889.50 4,016.14 4,015.95 487.26 4,009.76 4,009.76 5,000.00 6,500.00 4,454.83 4,009.76 3,553.50 4,042.46 3,975.63 4,095.89 889.44 2,000.00 9,593.48 City Bright Payroll credits 6,924.77 1,966.29 1,830.68 3,060.12 2,029.63 4,092.59 3,953.76 993.91 1,022.44 1,002.44 Misc. Credit 647.34 75,000.00 Advances from City per bank statements-24,262.36 34,192.22 52,079.20 32,262.41 32,591.43 32,836.50 29,506.64 29,671.91 29,097.95 25,967.61 29,459.16 23,538.18 35,137.57 31,380.55 32,848.06 31,308.90 22,094.59 28,705.04 5,844.06 34,016.94 31,298.60 24,867.39 28,418.30 23,162.12 23,550.93 Total month's advances 87,173.06 70,889.41 89,830.40 65,473.64 68,499.61 177,711.88 59,859.59 76,900.77 65,931.28 68,230.19 102,435.94 Total Bank Charges/misc credits per bank statement-72,694.57 99,759.34 73,706.86 70,295.06 67,566.15 145,266.76 68,169.42 93,156.46 70,314.67 71,609.06 76,313.72 Ending account balance 33,341.02 4,471.09 20,594.63 15,773.21 16,706.67 49,151.79 40,841.96 24,586.27 20,202.88 16,824.01 42,946.23 Net amount of reconciling items-16,658.98 45,528.91 29,405.37 34,226.79 33,293.33 848.21 9,158.04 25,413.73 29,797.12 33,175.99 7,053.77 (excludes advances in transit) City advances in transit 16,658.98 45,528.91 29,405.37 34,226.79 33,293.33 848.21 9,158.04 25,413.73 29,797.12 33,175.99 7,053.77 Reconciled advance total 50,000.00$ 50,000.00$ 50,000.00$ 50,000.00$ 50,000.00$ 50,000.00$ 50,000.00$ 50,000.00$ 50,000.00$ 50,000.00$ 50,000.00$ Reconciling items: 31 32 33 34 A. DESTINATION MEDICAL CENTER CORPORATION RESOLUTION NO. ___-2018 Approving the 2019 DMCC Funding Request and the Extension of Working Capital Loan and Authorizing Transmittal to the City of Rochester BACKGROUND RECITALS WHEREAS, the Destination Medical Center Corporation (“DMCC”) must adopt an annual Funding Request and Five Year Capital Plan. The DMCC Funding Request includes the DMCC annual budget, the Destination Medical Center Economic Development Agency (“EDA”) annual budget and work plan, and support costs incurred by the City of Rochester; and WHEREAS, on February 26, 2015, the DMCC adopted Resolution No. 26-2015, approving the form of and authorizing the Chair and Treasurer to execute, amend, and take other actions to implement the working capital loan documents to provide for advance funding of EDA operations (collectively, the “Loan Documents”); and WHEREAS, the EDA has submitted an EDA Request for Extension of the Working Capital Loan for 2019, requesting that the Loan Documents be extended for 2019 in the amount of $50,000, as such amount may be adjusted by the City pursuant to Section 2.8(c) of the Working Capital Loan Agreement (DMCC-EDA), effective April 1, 2014, and has provided the required annual reconciliation of advances and eligible expenses paid from such advances; and WHEREAS, the DMCC has completed the required annual reconciliation of the advances to the DMCC and the DMCC eligible expenses and has prepared a DMCC Request for Extension of the Working Capital Loan for 2019 in the amount of $1000, as such amount may be adjusted by the City pursuant to Section 2.8(c) of the Working Capital Loan Agreement (DMCC-City) effective April 1, 2014. RESOLUTION NOW, THEREFORE, BE IT RESOLVED, by the Destination Medical Center Board of Directors that the 2019 DMCC Funding Request, and the Five Year Capital Plan, each on file with the DMCC, are approved. Further, the DMCC hereby approves the projects set forth in the first year of the Five Year Capital Plan as public infrastructure projects within the meaning of Minnesota Statutes Section 469.40, Subdivision 11, and consistent with the Development Plan, adopted on April 23, 2015, as amended; provided that final approval of each of the capital projects will be subject to a later specific approval by the DMCC upon final determination of scope, costs and availability of funds. BE IT FURTHER RESOLVED, the EDA Request for Extension of the Working Capital Loan for 2019, and the DMCC Request for Extension of the Working Capital Loan for 2019, each on file with the DMCC, are approved. BE IT FURTHER RESOLVED, that the Chair and Treasurer are hereby authorized and directed to transmit this resolution to the City of Rochester and to take such actions as are necessary or convenient to effectuate the 2019 DMCC Funding Request, the Five Year Capital Plan, and the 35 extension of the Loan Documents, including, but not limited to, the authority to execute, deliver, and perform, in the name of and on behalf of the DMCC, the DMCC Request for Extension of the Working Capital Loan for 2019 and the Loan Documents to which the DMCC is a party, with such modifications, additions, deletions, or other changes as the Chair and Treasurer may deem necessary or appropriate to accomplish the requested extension, all which may be performed without further action of this Board. 1097332-3.DOCX 36 WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING Investment advisory services are offered through CliftonLarsonAllen Wealth Advisors, LLC, an SEC-registered investment advisor. | ©2017 CliftonLarsonAllen LLP Destination Medical Center Corporation September 25, 2018 37 ©2 0 1 7 C l i f t o n L a r s o n A l l e n L L P WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING IRS Form 990 •Financial information reconciles to DMCC’s audited financial statements •Part III (page 2) –statement of DMCC’s organizational purpose •Part VI (page 6) –governance •Part VII (page 7) –board members 238 ©2 0 1 7 C l i f t o n L a r s o n A l l e n L L P WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING IRS Form 990 •Schedule B (page 21) –contributors •Schedule R (page 31) –related organizations •No unrelated business income for 2017 •Filing deadline is November 15, 2018 339 ©2 0 1 7 C l i f t o n L a r s o n A l l e n L L P WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING Charitable Organization Annual Report •Filed with Minnesota Attorney General’s Office Charities Division •No changes in tax-exempt status (page 2) •No changes in organizational purpose or programs (page 2) •No changes in ability to solicit contributions (page 3) •No compensation paid in excess of $100,000 (page 3) •Filing deadline November 15, 2018 440 ©2 0 1 7 C l i f t o n L a r s o n A l l e n L L P WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING Minnesota Non-profit Corporation Annual Registration •Filed online with Minnesota Secretary of State •In good standing through December 31, 2018 •Annual renewal to be filed (online) for 2019 541 ©2 0 1 7 C l i f t o n L a r s o n A l l e n L L P WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING Thank you for allowing us to serve you! Contact Information: Craig Popenhagen, Principal Marty Lienau, Director 507-280-2327 507-280-2308 Craig.popenhagen@claconnect.com marty.Lienau@claconnect.com 642 DRA F T 785471 04-01-17 C2 Website Address: Legal Name of Organization Federal EIN:Fiscal Year-End: Mailing Address:Physical Address: www.ag.state.mn.us/charity Minnesota Attorney General's Office Charities Division 445 Minnesota Street, Suite 1200 St. Paul, MN 55101-2130 (Pursuant to Minn. Stat. ch. 309) mm/dd/yyyy Did the organization's fiscal year-end change? Yes No Contact Person Contact Person Street Address Street Address City, State, and ZIP Code City, State, and ZIP Code Phone Number Phone Number Email Address Email Address 1. 2. 3. 4. 5. 6. 7. Organization's website: List all of the organization's alternate and former names (attach list if more space is needed). Alternate Former Alternate Former List all names under which the organization solicits contributions (attach list if more space is needed). Is the organization incorporated pursuant to Minn. Stat. ch. 317A?Yes No Total amount of contributions the organization received from Minnesota donors:$ Has the organization's tax-exempt status with the IRS changed? Yes No If yes, attach explanation. Has the organization significantly changed its purpose(s) or program(s)? Yes No If yes, attach explanation. Mail To: SECTION A: Organization Information STATE OF MINNESOTA CHARITABLE ORGANIZATION ANNUAL REPORT FORM DESTINATION MEDICAL CENTER CORPORATION 46-4959371 12312017 X DALE MARTINSON DALE MARTINSON 201 4TH STREET SE, NO. 204 201 4TH STREET SE, NO. 204 ROCHESTER, MN 55904 ROCHESTER, MN 55904 507-328-2850 507-328-2850 DMARTINSON@ROCHESTERMN.GOV DMARTINSON@ROCHESTERMN.GOV WWW.DMC.MN DESTINATION MEDICAL CENTER CORPORATION X 2,471,264. X X 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 2 43 DRA F T 785472 04-01-17 C2 Note: Name and title Compensation* Other compensation See 8. 9. 10. 11. Has the organization been denied the right to solicit contributions by any court or government agency? Yes No If yes, attach explanation. Does the organization use the services of a professional fundraiser (outside solicitor or consultant) to solicit contributions in Minnesota? Yes No If yes, provide the following information for each (attach list if more space is needed): Name of Professional Fundraiser Compensation Street Address City, State, and ZIP Code Is the organization a food shelf? Yes No If yes, is the organization required to file an audit? Yes, audit attached No An organization that has total revenue of more than $750,000 is required to file an audit prepared in accordance with generally accepted accounting principles by an independent CPA or LPA. The value of donated food to a nonprofit food shelf may be excluded from the total revenue if the food is donated for subsequent distribution at no charge and is not resold. Do any directors, officers, or employees of the organization or its related organization(s) receive total compensation* of more than $100,000? Yes No If yes, provide the following information for the five highest paid individuals: *Compensation is defined as the total amount reported on Form W-2 (Box 5) or Form 1099-MISC (Box 7) issued by the organization and its related organizations to the individual. Minn. Stat. ¤ 309.53, subd. 3(i) and Minn. Stat. ¤ 317A.011 for definitions. CHARITABLE ORGANIZATION ANNUAL REPORT FORM (Continued) X X X X 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 3 44 DRA F T 785473 04-01-17 C2 5.$5 9 10 14 18 9. 10. $ $ 14.$ 18.$ $ This section must be completed by organizations that file an IRS Form 990-EZ, 990-PF, or 990-N. Organizations that file an IRS Form 990 may skip Section B and go directly to Section C. 1. 2. 3. 4. Contributions Received $ $ $ $ 1 2 3 4 6 7 8 11 12 13 15 16 17 Government Grants Program Service Revenue Other Revenue 6. 7. 8. Program Expenses $ $ $ Management & General Expenses Fund-raising Expenses (Line 5 minus Line 9) 11. 12. 13. Cash $ $ $ Land, Buildings & Equipment Other Assets 15. 16. 17. Accounts Payable $ $ $ Grants Payable Other Liabilities (Line 14 minus Line 18) TOTAL INCOME TOTAL EXPENSES EXCESS or DEFICIT TOTAL ASSETS TOTAL LIABILITIES CHARITABLE ORGANIZATION ANNUAL REPORT FORM (Continued) SECTION B: Financial Information INCOME EXPENSES ASSETS LIABILITIES FUND BALANCE/NET WORTH 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 4 45 DRA F T 785474 04-01-17 Total functional expenses. C2 (A)(B)(C)(D) 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. a. b. c. d. e. f. g. a. b. c. d. Joint costs. Grants and other assistance to individuals in the U.S. Compensation not included above, to disqualified persons (as defined under section 4958(f)(1) and persons described in section 4958(c)(3)(B) (include section 401(k) and section 403(b) employer contributions) Add lines 1 through 24d This expense statement must be prepared in accordance with generally accepted accounting principles. Each column must be completed, and Columns B, C, and D must equal Column A. The amount on Line 25, Column A must match Line 17 of IRS Form 990-EZ or Line 26 of IRS Form 990-PF. Total expenses Program serviceexpenses Management andgeneral expenses Fundraisingexpenses Grants and other assistance to governments and organizations in the U.S. Grants and other assistance to governments, organizations, and individuals outside the U.S. Benefits paid to or for members Compensation of current officers, directors, trustees, and key employees Other salaries and wages Pension plan contributions Other employee benefits Payroll taxes Fees for services (non-employees): Management Legal Accounting Lobbying Professional fundraising services Investment management fees Other Advertising and promotion Office expenses Information technology Royalties Occupancy Travel Payments of travel or entertainment expenses for any federal, state, or local public officials Conferences, conventions, and meetings Interest Payments to affiliates Depreciation, depletion, and amortization Insurance Other expenses. Itemize expenses not covered above. Expenses labeled miscellaneous may not exceed 5% of total expenses (Line 25). Check here | if following SOP 98-2. Complete this line only if the organi-zation reported in Column B joint costs from acombined educational campaign andfundraising solicitation CHARITABLE ORGANIZATION ANNUAL REPORT FORM (Continued) Section B (continued): Statement of Functional Expenses 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 5 46 DRA F T 785475 04-01-17 C2 See The form must be executed pursuant to a resolution of the board of directors, trustees, or managing group and must be signed by two officers of the organization. Minn. Stat. ¤ 309.52, subd. 3. We, the undersigned, state and acknowledge that we are duly constituted officers of this organization, being the (Title) and (Title) respectively, and that we execute this document on behalf of the organization pursuant to the resolution of the (Board of Directors, Trustees, or Managing Group) adopted on the day of , 20 , approving the contents of the document, and do hereby certify that the (Board of Directors, Trustees, or Managing Group) has assumed, and will continue to assume, responsibility for determining matters of policy, and have supervised, and will continue to supervise, the operations and finances of the organization. We further state that the information supplied is true, correct and complete to the best of our knowledge. Name (Print)Name (Print) Signature Signature Title Title Date Date CHARITABLE ORGANIZATION ANNUAL REPORT FORM (Continued) Section C: Board of Directors Signatures and Acknowledgment TREASURER CHAIR BOARD OF DIRECTORS BOARD OF DIRECTORS JIM BIER R.T. RYBAK TREASURER CHAIR 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 6 47 48 DRA F T Check if self-employed OMB No. 1545-0047 Department of the Treasury Internal Revenue Service Check ifapplicable: Addresschange Namechange Initialreturn Finalreturn/termin-ated Gross receipts $ Amendedreturn Applica-tionpending Are all subordinates included? 732001 11-28-17 Beginning of Current Year Paid Preparer Use Only Under section 501(c), 527, or 4947(a)(1) of the Internal Revenue Code (except private foundations) | Do not enter social security numbers on this form as it may be made public.Open to Public Inspection| Go to www.irs.gov/Form990 for instructions and the latest information. A For the 2017 calendar year, or tax year beginning and ending B C D Employer identification number E G H(a) H(b) H(c) F Yes No Yes No I J K Website: | L M 1 2 3 4 5 6 7 3 4 5 6 7a 7b a bAc t i v i t i e s & G o v e r n a n c e Prior Year Current Year 8 9 10 11 12 13 14 15 16 17 18 19 Re v e n u e a b Ex p e n s e s End of Year 20 21 22 Sign Here Yes No For Paperwork Reduction Act Notice, see the separate instructions. (or P.O. box if mail is not delivered to street address) Room/suite )501(c)(3) 501(c) ((insert no.) 4947(a)(1) or 527 |Corporation Trust Association OtherForm of organization:Year of formation:State of legal domicile: | | Ne t A s s e t s o r Fu n d B a l a n c e s Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete. Declaration of preparer (other than officer) is based on all information of which preparer has any knowledge. Signature of officer Date Type or print name and title Date PTINPrint/Type preparer's name Preparer's signature Firm's name Firm's EIN Firm's address Phone no. Form Name of organization Doing business as Number and street Telephone number City or town, state or province, country, and ZIP or foreign postal code Is this a group return for subordinates?Name and address of principal officer:~~ If "No," attach a list. (see instructions) Group exemption number | Tax-exempt status: Briefly describe the organization's mission or most significant activities: Check this box if the organization discontinued its operations or disposed of more than 25% of its net assets. Number of voting members of the governing body (Part VI, line 1a) Number of independent voting members of the governing body (Part VI, line 1b) Total number of individuals employed in calendar year 2017 (Part V, line 2a) ~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~ Total number of volunteers (estimate if necessary) Total unrelated business revenue from Part VIII, column (C), line 12 Net unrelated business taxable income from Form 990-T, line 34 ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~ •••••••••••••••••••••• Contributions and grants (Part VIII, line 1h) ~~~~~~~~~~~~~~~~~~~~~ Program service revenue (Part VIII, line 2g) ~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~Investment income (Part VIII, column (A), lines 3, 4, and 7d) Other revenue (Part VIII, column (A), lines 5, 6d, 8c, 9c, 10c, and 11e) ~~~~~~~~ Total revenue - add lines 8 through 11 (must equal Part VIII, column (A), line 12) ••• Grants and similar amounts paid (Part IX, column (A), lines 1-3) Benefits paid to or for members (Part IX, column (A), line 4) Salaries, other compensation, employee benefits (Part IX, column (A), lines 5-10) ~~~~~~~~~~~ ~~~~~~~~~~~~~ ~~~ Professional fundraising fees (Part IX, column (A), line 11e) Total fundraising expenses (Part IX, column (D), line 25) ~~~~~~~~~~~~~~ Other expenses (Part IX, column (A), lines 11a-11d, 11f-24e) Total expenses. Add lines 13-17 (must equal Part IX, column (A), line 25) Revenue less expenses. Subtract line 18 from line 12 ~~~~~~~~~~~~~ ~~~~~~~ •••••••••••••••• Total assets (Part X, line 16) Total liabilities (Part X, line 26) Net assets or fund balances. Subtract line 21 from line 20 ~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~ •••••••••••••• May the IRS discuss this return with the preparer shown above? (see instructions) ••••••••••••••••••••• LHA Form (2017) Part I Summary Signature BlockPart II 990 Return of Organization Exempt From Income Tax990 2017 § == 999 DESTINATION MEDICAL CENTER CORPORATION 46-4959371 201 4TH STREET SE 204 507-328-2850 2,471,270. ROCHESTER, MN 55904 R.T. RYBAK X SAME AS C ABOVE X WWW.DMC.MN X 2013 MN PLANNING AND IMPLEMENTATION OF DESTINATION MEDICAL CENTER DEVELOPMENT IN DOWNTOWN ROCHESTER, 6 6 0 8 0. 0. 2,288,339. 2,471,264. 0.0. 1.6. 0.0. 2,288,340. 2,471,270. 0.0. 0.0. 0.0. 0.0. 0. 2,288,340. 2,471,270. 2,288,340. 2,471,270. 0.0. 362,410. 485,733. 362,410. 485,733. 0.0. JIM BIER, TREASURER CRAIG POPENHAGEN CRAIG POPENHAGEN 08/31/18 P01587689 CLIFTONLARSONALLEN LLP 41-0746749 P.O. BOX 217 AUSTIN, MN 55912 507-434-7000 X SEE SCHEDULE O FOR ORGANIZATION MISSION STATEMENT CONTINUATION 49 DRA F T Code:Expenses $including grants of $Revenue $ Code:Expenses $including grants of $Revenue $ Code:Expenses $including grants of $Revenue $ Expenses $including grants of $Revenue $ 732002 11-28-17 1 2 3 4 Yes No Yes No 4a 4b 4c 4d 4e Form 990 (2017)Page Check if Schedule O contains a response or note to any line in this Part III •••••••••••••••••••••••••••• Briefly describe the organization's mission: Did the organization undertake any significant program services during the year which were not listed on the prior Form 990 or 990-EZ? If "Yes," describe these new services on Schedule O. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization cease conducting, or make significant changes in how it conducts, any program services? If "Yes," describe these changes on Schedule O. ~~~~~~ Describe the organization's program service accomplishments for each of its three largest program services, as measured by expenses. Section 501(c)(3) and 501(c)(4) organizations are required to report the amount of grants and allocations to others, the total expenses, and revenue, if any, for each program service reported. () () () () () () () () () Other program services (Describe in Schedule O.) () () Total program service expenses | Form (2017) 2 Statement of Program Service AccomplishmentsPart III 990 DESTINATION MEDICAL CENTER CORPORATION 46-4959371 X WITH MAYO CLINIC AT ITS HEART, THE DESTINATION MEDICAL CENTER (DMC) INITIATIVE WILL BE THE CATALYST TO POSITION ROCHESTER, MINNESOTA AS THE WORLD'S PREMIER DESTINATION CENTER FOR HEALTH AND WELLNESS; ATTRACTING PEOPLE, INVESTMENT, AND JOBS TO AMERICA'S CITY FOR HEALTH X X 2,234,105. OVERSIGHT, PREPARATION AND IMPLEMENTATION OF THE DEVELOPMENT PLAN - AN IN DEPTH STUDY OF INFRASTRUCTURE, PLANNING, AND DEVELOPMENT OPPORTUNITIES, AND FRAMEWORK TO SUPPORT THE DEVELOPMENT OF ROCHESTER AS A DESTINATION MEDICAL CENTER. 2,234,105. 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 2 50 DRA F T 732003 11-28-17 Yes No 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 1 2 3 4 5 6 7 8 9 10 Section 501(c)(3) organizations. a b c d e f a b 11a 11b 11c 11d 11e 11f 12a 12b 13 14a 14b 15 16 17 18 19 a b If "Yes," complete Schedule A Schedule B, Schedule of Contributors If "Yes," complete Schedule C, Part I If "Yes," complete Schedule C, Part II If "Yes," complete Schedule C, Part III If "Yes," complete Schedule D, Part I If "Yes," complete Schedule D, Part II If "Yes," complete Schedule D, Part III If "Yes," complete Schedule D, Part IV If "Yes," complete Schedule D, Part V If "Yes," complete Schedule D, Part VI If "Yes," complete Schedule D, Part VII If "Yes," complete Schedule D, Part VIII If "Yes," complete Schedule D, Part IX If "Yes," complete Schedule D, Part X If "Yes," complete Schedule D, Part X If "Yes," complete Schedule D, Parts XI and XII If "Yes," and if the organization answered "No" to line 12a, then completing Schedule D, Parts XI and XII is optional If "Yes," complete Schedule E If "Yes," complete Schedule F, Parts I and IV If "Yes," complete Schedule F, Parts II and IV If "Yes," complete Schedule F, Parts III and IV If "Yes," complete Schedule G, Part I If "Yes," complete Schedule G, Part II If "Yes," complete Schedule G, Part III Form 990 (2017)Page Is the organization described in section 501(c)(3) or 4947(a)(1) (other than a private foundation)? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Is the organization required to complete ? Did the organization engage in direct or indirect political campaign activities on behalf of or in opposition to candidates for public office? ~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization engage in lobbying activities, or have a section 501(h) election in effect during the tax year? Is the organization a section 501(c)(4), 501(c)(5), or 501(c)(6) organization that receives membership dues, assessments, or similar amounts as defined in Revenue Procedure 98-19? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~ Did the organization maintain any donor advised funds or any similar funds or accounts for which donors have the right to provide advice on the distribution or investment of amounts in such funds or accounts? Did the organization receive or hold a conservation easement, including easements to preserve open space, the environment, historic land areas, or historic structures? Did the organization maintain collections of works of art, historical treasures, or other similar assets? ~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization report an amount in Part X, line 21, for escrow or custodial account liability, serve as a custodian for amounts not listed in Part X; or provide credit counseling, debt management, credit repair, or debt negotiation services? Did the organization, directly or through a related organization, hold assets in temporarily restricted endowments, permanent endowments, or quasi-endowments? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~ If the organization's answer to any of the following questions is "Yes," then complete Schedule D, Parts VI, VII, VIII, IX, or X as applicable. Did the organization report an amount for land, buildings, and equipment in Part X, line 10? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization report an amount for investments - other securities in Part X, line 12 that is 5% or more of its total assets reported in Part X, line 16? Did the organization report an amount for investments - program related in Part X, line 13 that is 5% or more of its total assets reported in Part X, line 16? ~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization report an amount for other assets in Part X, line 15 that is 5% or more of its total assets reported in Part X, line 16? Did the organization report an amount for other liabilities in Part X, line 25? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~ Did the organization's separate or consolidated financial statements for the tax year include a footnote that addresses the organization's liability for uncertain tax positions under FIN 48 (ASC 740)? Did the organization obtain separate, independent audited financial statements for the tax year? ~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Was the organization included in consolidated, independent audited financial statements for the tax year? ~~~~~ Is the organization a school described in section 170(b)(1)(A)(ii)? Did the organization maintain an office, employees, or agents outside of the United States? ~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~ Did the organization have aggregate revenues or expenses of more than $10,000 from grantmaking, fundraising, business, investment, and program service activities outside the United States, or aggregate foreign investments valued at $100,000 or more? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization report on Part IX, column (A), line 3, more than $5,000 of grants or other assistance to or for any foreign organization? Did the organization report on Part IX, column (A), line 3, more than $5,000 of aggregate grants or other assistance to or for foreign individuals? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization report a total of more than $15,000 of expenses for professional fundraising services on Part IX, column (A), lines 6 and 11e? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization report more than $15,000 total of fundraising event gross income and contributions on Part VIII, lines 1c and 8a? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization report more than $15,000 of gross income from gaming activities on Part VIII, line 9a? ••••••••••••••••••••••••••••••••••••••••••••••• Form (2017) 3 Part IV Checklist of Required Schedules 990 DESTINATION MEDICAL CENTER CORPORATION 46-4959371 X X X X X X X X X X X X X X X X X X X X X X X X X X 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 3 51 DRA F T 732004 11-28-17 Yes No 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 a b 20a 20b 21 22 23 24a 24b 24c 24d 25a 25b 26 27 28a 28b 28c 29 30 31 32 33 34 35a 35b 36 37 38 a b c d a b Section 501(c)(3), 501(c)(4), and 501(c)(29) organizations. a b c a b Section 501(c)(3) organizations. Note. (continued) If "Yes," complete Schedule H If "Yes," complete Schedule I, Parts I and II If "Yes," complete Schedule I, Parts I and III If "Yes," complete Schedule J If "Yes," answer lines 24b through 24d and complete Schedule K. If "No", go to line 25a If "Yes," complete Schedule L, Part I If "Yes," complete Schedule L, Part I If "Yes," complete Schedule L, Part II If "Yes," complete Schedule L, Part III If "Yes," complete Schedule L, Part IV If "Yes," complete Schedule L, Part IV If "Yes," complete Schedule L, Part IV If "Yes," complete Schedule M If "Yes," complete Schedule M If "Yes," complete Schedule N, Part I If "Yes," complete Schedule N, Part II If "Yes," complete Schedule R, Part I If "Yes," complete Schedule R, Part II, III, or IV, and Part V, line 1 If "Yes," complete Schedule R, Part V, line 2 If "Yes," complete Schedule R, Part V, line 2 If "Yes," complete Schedule R, Part VI Form 990 (2017)Page Did the organization operate one or more hospital facilities? ~~~~~~~~~~~~~~~~ If "Yes" to line 20a, did the organization attach a copy of its audited financial statements to this return? ~~~~~~~~~~ Did the organization report more than $5,000 of grants or other assistance to any domestic organization or domestic government on Part IX, column (A), line 1? ~~~~~~~~~~~~~~ Did the organization report more than $5,000 of grants or other assistance to or for domestic individuals on Part IX, column (A), line 2? ~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization answer "Yes" to Part VII, Section A, line 3, 4, or 5 about compensation of the organization's current and former officers, directors, trustees, key employees, and highest compensated employees? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization have a tax-exempt bond issue with an outstanding principal amount of more than $100,000 as of the last day of the year, that was issued after December 31, 2002? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization invest any proceeds of tax-exempt bonds beyond a temporary period exception? Did the organization maintain an escrow account other than a refunding escrow at any time during the year to defease any tax-exempt bonds? Did the organization act as an "on behalf of" issuer for bonds outstanding at any time during the year? ~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~ Did the organization engage in an excess benefit transaction with a disqualified person during the year? Is the organization aware that it engaged in an excess benefit transaction with a disqualified person in a prior year, and that the transaction has not been reported on any of the organization's prior Forms 990 or 990-EZ? ~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization report any amount on Part X, line 5, 6, or 22 for receivables from or payables to any current or former officers, directors, trustees, key employees, highest compensated employees, or disqualified persons? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization provide a grant or other assistance to an officer, director, trustee, key employee, substantial contributor or employee thereof, a grant selection committee member, or to a 35% controlled entity or family member of any of these persons? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Was the organization a party to a business transaction with one of the following parties (see Schedule L, Part IV instructions for applicable filing thresholds, conditions, and exceptions): A current or former officer, director, trustee, or key employee? ~~~~~~~~~~~ A family member of a current or former officer, director, trustee, or key employee? An entity of which a current or former officer, director, trustee, or key employee (or a family member thereof) was an officer, director, trustee, or direct or indirect owner? ~~ ~~~~~~~~~~~~~~~~~~~~~ Did the organization receive more than $25,000 in non-cash contributions? Did the organization receive contributions of art, historical treasures, or other similar assets, or qualified conservation contributions? ~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization liquidate, terminate, or dissolve and cease operations? Did the organization sell, exchange, dispose of, or transfer more than 25% of its net assets? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization own 100% of an entity disregarded as separate from the organization under Regulations sections 301.7701-2 and 301.7701-3? Was the organization related to any tax-exempt or taxable entity? ~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization have a controlled entity within the meaning of section 512(b)(13)? If "Yes" to line 35a, did the organization receive any payment from or engage in any transaction with a controlled entity within the meaning of section 512(b)(13)? ~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~ Did the organization make any transfers to an exempt non-charitable related organization? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization conduct more than 5% of its activities through an entity that is not a related organization and that is treated as a partnership for federal income tax purposes? ~~~~~~~~ Did the organization complete Schedule O and provide explanations in Schedule O for Part VI, lines 11b and 19? All Form 990 filers are required to complete Schedule O ••••••••••••••••••••••••••••••• Form (2017) 4 Part IV Checklist of Required Schedules 990 DESTINATION MEDICAL CENTER CORPORATION 46-4959371 X X X X X X X X X X X X X X X X X X X X X X 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 4 52 DRA F T 732005 11-28-17 Yes No 1 2 3 4 5 6 7 a b c 1a 1b 1c a b 2a Note. 2b 3a 3b 4a 5a 5b 5c 6a 6b 7a 7b 7c 7e 7f 7g 7h 8 9a 9b a b a b a b c a b Organizations that may receive deductible contributions under section 170(c). a b c d e f g h 7d 8 9 10 11 12 13 14 Sponsoring organizations maintaining donor advised funds. Sponsoring organizations maintaining donor advised funds. a b Section 501(c)(7) organizations. a b 10a 10b Section 501(c)(12) organizations. a b 11a 11b a b Section 4947(a)(1) non-exempt charitable trusts. 12a 12b Section 501(c)(29) qualified nonprofit health insurance issuers. Note. a b c a b 13a 13b 13c 14a 14b e-file If "No," to line 3b, provide an explanation in Schedule O If "No," provide an explanation in Schedule O Did the organization receive a payment in excess of $75 made partly as a contribution and partly for goods and services provided to the payor? Form (2017) Form 990 (2017)Page Check if Schedule O contains a response or note to any line in this Part V ••••••••••••••••••••••••••• Enter the number reported in Box 3 of Form 1096. Enter -0- if not applicable ~~~~~~~~~~~ Enter the number of Forms W-2G included in line 1a. Enter -0- if not applicable ~~~~~~~~~~ Did the organization comply with backup withholding rules for reportable payments to vendors and reportable gaming (gambling) winnings to prize winners?••••••••••••••••••••••••••••••••••••••••••• Enter the number of employees reported on Form W-3, Transmittal of Wage and Tax Statements, filed for the calendar year ending with or within the year covered by this return~~~~~~~~~~ If at least one is reported on line 2a, did the organization file all required federal employment tax returns? If the sum of lines 1a and 2a is greater than 250, you may be required to (see instructions) ~~~~~~~~~~ ~~~~~~~~~~~ Did the organization have unrelated business gross income of $1,000 or more during the year? If "Yes," has it filed a Form 990-T for this year? ~~~~~~~~~~~~~~ ~~~~~~~~~~ At any time during the calendar year, did the organization have an interest in, or a signature or other authority over, a financial account in a foreign country (such as a bank account, securities account, or other financial account)?~~~~~~~ If "Yes," enter the name of the foreign country: See instructions for filing requirements for FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR). Was the organization a party to a prohibited tax shelter transaction at any time during the tax year? Did any taxable party notify the organization that it was or is a party to a prohibited tax shelter transaction? ~~~~~~~~~~~~ ~~~~~~~~~ If "Yes," to line 5a or 5b, did the organization file Form 8886-T? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Does the organization have annual gross receipts that are normally greater than $100,000, and did the organization solicit any contributions that were not tax deductible as charitable contributions? If "Yes," did the organization include with every solicitation an express statement that such contributions or gifts were not tax deductible? ~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ If "Yes," did the organization notify the donor of the value of the goods or services provided? Did the organization sell, exchange, or otherwise dispose of tangible personal property for which it was required to file Form 8282? ~~~~~~~~~~~~~~~ •••••••••••••••••••••••••••••••••••••••••••••••••••• If "Yes," indicate the number of Forms 8282 filed during the year Did the organization receive any funds, directly or indirectly, to pay premiums on a personal benefit contract? ~~~~~~~~~~~~~~~~ ~~~~~~~ ~~~~~~~~~Did the organization, during the year, pay premiums, directly or indirectly, on a personal benefit contract? If the organization received a contribution of qualified intellectual property, did the organization file Form 8899 as required? If the organization received a contribution of cars, boats, airplanes, or other vehicles, did the organization file a Form 1098-C? ~ Did a donor advised fund maintained by the sponsoring organization have excess business holdings at any time during the year? ~~~~~~~~~~~~~~~~~~~ Did the sponsoring organization make any taxable distributions under section 4966? Did the sponsoring organization make a distribution to a donor, donor advisor, or related person? ~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~ Enter: Initiation fees and capital contributions included on Part VIII, line 12 Gross receipts, included on Form 990, Part VIII, line 12, for public use of club facilities ~~~~~~~~~~~~~~~ ~~~~~~ Enter: Gross income from members or shareholders Gross income from other sources (Do not net amounts due or paid to other sources against amounts due or received from them.) ~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Is the organization filing Form 990 in lieu of Form 1041? If "Yes," enter the amount of tax-exempt interest received or accrued during the year •••••• Is the organization licensed to issue qualified health plans in more than one state? See the instructions for additional information the organization must report on Schedule O. ~~~~~~~~~~~~~~~~~~~~~ Enter the amount of reserves the organization is required to maintain by the states in which the organization is licensed to issue qualified health plans Enter the amount of reserves on hand ~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization receive any payments for indoor tanning services during the tax year? If "Yes," has it filed a Form 720 to report these payments? ~~~~~~~~~~~~~~~~ •••••••••• 5 Part V Statements Regarding Other IRS Filings and Tax Compliance 990 J DESTINATION MEDICAL CENTER CORPORATION 46-4959371 2 0 0 X X X X X X X X X X 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 5 53 DRA F T 732006 11-28-17 Yes No 1a 1b 1 2 3 4 5 6 7 8 9 a b 2 3 4 5 6 7a 7b 8a 8b 9 a b a b Yes No 10 11 a b 10a 10b 11a 12a 12b 12c 13 14 15a 15b 16a 16b a b 12a b c 13 14 15 a b 16a b 17 18 19 20 For each "Yes" response to lines 2 through 7b below, and for a "No" response to line 8a, 8b, or 10b below, describe the circumstances, processes, or changes in Schedule O. See instructions. If "Yes," provide the names and addresses in Schedule O (This Section B requests information about policies not required by the Internal Revenue Code.) If "No," go to line 13 If "Yes," describe in Schedule O how this was done (explain in Schedule O) If there are material differences in voting rights among members of the governing body, or if the governing body delegated broad authority to an executive committee or similar committee, explain in Schedule O. Did the organization contemporaneously document the meetings held or written actions undertaken during the year by the following: Were officers, directors, or trustees, and key employees required to disclose annually interests that could give rise to conflicts? Form (2017) Form 990 (2017)Page Check if Schedule O contains a response or note to any line in this Part VI ••••••••••••••••••••••••••• Enter the number of voting members of the governing body at the end of the tax year Enter the number of voting members included in line 1a, above, who are independent ~~~~~~ ~~~~~~ Did any officer, director, trustee, or key employee have a family relationship or a business relationship with any other officer, director, trustee, or key employee? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization delegate control over management duties customarily performed by or under the direct supervision of officers, directors, or trustees, or key employees to a management company or other person?~~~~~~~~~~~~~~ Did the organization make any significant changes to its governing documents since the prior Form 990 was filed? Did the organization become aware during the year of a significant diversion of the organization's assets? Did the organization have members or stockholders? ~~~~~ ~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization have members, stockholders, or other persons who had the power to elect or appoint one or more members of the governing body? Are any governance decisions of the organization reserved to (or subject to approval by) members, stockholders, or persons other than the governing body? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ The governing body? Each committee with authority to act on behalf of the governing body? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~ Is there any officer, director, trustee, or key employee listed in Part VII, Section A, who cannot be reached at the organization's mailing address? ••••••••••••••••• Did the organization have local chapters, branches, or affiliates? If "Yes," did the organization have written policies and procedures governing the activities of such chapters, affiliates, and branches to ensure their operations are consistent with the organization's exempt purposes? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~ Has the organization provided a complete copy of this Form 990 to all members of its governing body before filing the form? Describe in Schedule O the process, if any, used by the organization to review this Form 990. Did the organization have a written conflict of interest policy? ~~~~~~~~~~~~~~~~~~~~ ~~~~~~ Did the organization regularly and consistently monitor and enforce compliance with the policy? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization have a written whistleblower policy? Did the organization have a written document retention and destruction policy? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~ Did the process for determining compensation of the following persons include a review and approval by independent persons, comparability data, and contemporaneous substantiation of the deliberation and decision? The organization's CEO, Executive Director, or top management official Other officers or key employees of the organization If "Yes" to line 15a or 15b, describe the process in Schedule O (see instructions). ~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization invest in, contribute assets to, or participate in a joint venture or similar arrangement with a taxable entity during the year? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ If "Yes," did the organization follow a written policy or procedure requiring the organization to evaluate its participation in joint venture arrangements under applicable federal tax law, and take steps to safeguard the organization's exempt status with respect to such arrangements?•••••••••••••••••••••••••••••••••••• List the states with which a copy of this Form 990 is required to be filed Section 6104 requires an organization to make its Forms 1023 (or 1024 if applicable), 990, and 990-T (Section 501(c)(3)s only) available for public inspection. Indicate how you made these available. Check all that apply. Own website Another's website Upon request Other Describe in Schedule O whether (and if so, how) the organization made its governing documents, conflict of interest policy, and financial statements available to the public during the tax year. State the name, address, and telephone number of the person who possesses the organization's books and records: | 6 Part VI Governance, Management, and Disclosure Section A. Governing Body and Management Section B. Policies Section C. Disclosure 990 J DESTINATION MEDICAL CENTER CORPORATION 46-4959371 X 6 6 X X X X X X X X X X X X X X X X X X X X MN X DALE MARTINSON - 507-328-2850 201 4TH STREET SE ROOM 204, ROCHESTER, MN 55904 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 6 54 DRA F T In d i v i d u a l t r u s t e e o r d i r e c t o r In s t i t u t i o n a l t r u s t e e Of f i c e r Ke y e m p l o y e e Hi g h e s t c o m p e n s a t e d em p l o y e e Fo r m e r (do not check more than one box, unless person is both an officer and a director/trustee) 732007 11-28-17 current Section A. Officers, Directors, Trustees, Key Employees, and Highest Compensated Employees 1a current current former former directors or trustees (A)(B)(C)(D)(E)(F) Form 990 (2017)Page Check if Schedule O contains a response or note to any line in this Part VII ••••••••••••••••••••••••••• Complete this table for all persons required to be listed. Report compensation for the calendar year ending with or within the organization's tax year. ¥ List all of the organization's officers, directors, trustees (whether individuals or organizations), regardless of amount of compensation.Enter -0- in columns (D), (E), and (F) if no compensation was paid.¥ List all of the organization's key employees, if any. See instructions for definition of "key employee." ¥ List the organization's five highest compensated employees (other than an officer, director, trustee, or key employee) who received report- able compensation (Box 5 of Form W-2 and/or Box 7 of Form 1099-MISC) of more than $100,000 from the organization and any related organizations. ¥ List all of the organization's officers, key employees, and highest compensated employees who received more than $100,000 of reportable compensation from the organization and any related organizations. ¥ List all of the organization's that received, in the capacity as a former director or trustee of the organization, more than $10,000 of reportable compensation from the organization and any related organizations. List persons in the following order: individual trustees or directors; institutional trustees; officers; key employees; highest compensated employees; and former such persons. Check this box if neither the organization nor any related organization compensated any current officer, director, or trustee. PositionName and Title Average hours per week (list any hours for related organizations below line) Reportable compensation from the organization (W-2/1099-MISC) Reportable compensation from related organizations (W-2/1099-MISC) Estimated amount of other compensation from the organization and related organizations Form (2017) 7 Part VII Compensation of Officers, Directors, Trustees, Key Employees, Highest Compensated Employees, and Independent Contractors 990 DESTINATION MEDICAL CENTER CORPORATION 46-4959371 X (1) TINA F. SMITH 6.00 CHAIR THRU 12/28/2017 X X 0.0.0. (2) R.T. RYBAK 4.00 VICE CHAIR X X 0.0.0. (3) ARDELL F. BREDE 4.00 DIRECTOR X X 0.0.0. (4) JAMES CAMPBELL 4.00 DIRECTOR X X 0.0.0. (5) JIM BIER 4.00 TREASURER X 0.0.0. (6) MICHAEL DOUGHERTY 4.00 DIRECTOR X 0.0.0. (7) MARK HICKEY 4.00 DIRECTOR X 0.0.0. (8) SUSAN PARK RANI 4.00 DIRECTOR THRU 11/2/2017 X 0.0.0. 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 7 55 DRA F T Fo r m e r In d i v i d u a l t r u s t e e o r d i r e c t o r In s t i t u t i o n a l t r u s t e e Of f i c e r Hi g h e s t c o m p e n s a t e d em p l o y e e Ke y e m p l o y e e (do not check more than one box, unless person is both an officer and a director/trustee) 732008 11-28-17 Section A. Officers, Directors, Trustees, Key Employees, and Highest Compensated Employees (B)(C)(A)(D)(E)(F) 1b c d Sub-total Total from continuation sheets to Part VII, Section A Total (add lines 1b and 1c) 2 Yes No 3 4 5 former 3 4 5 Section B. Independent Contractors 1 (A)(B)(C) 2 (continued) If "Yes," complete Schedule J for such individual If "Yes," complete Schedule J for such individual If "Yes," complete Schedule J for such person Page Form 990 (2017) PositionAverage hours per week (list any hours for related organizations below line) Name and title Reportable compensation from the organization (W-2/1099-MISC) Reportable compensation from related organizations (W-2/1099-MISC) Estimated amount of other compensation from the organization and related organizations ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ | ~~~~~~~~~~ | •••••••••••••••••••••••• | Total number of individuals (including but not limited to those listed above) who received more than $100,000 of reportable compensation from the organization | Did the organization list any officer, director, or trustee, key employee, or highest compensated employee on line 1a? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ For any individual listed on line 1a, is the sum of reportable compensation and other compensation from the organization and related organizations greater than $150,000? ~~~~~~~~~~~~~ Did any person listed on line 1a receive or accrue compensation from any unrelated organization or individual for services rendered to the organization? •••••••••••••••••••••••• Complete this table for your five highest compensated independent contractors that received more than $100,000 of compensation from the organization. Report compensation for the calendar year ending with or within the organization's tax year. Name and business address Description of services Compensation Total number of independent contractors (including but not limited to those listed above) who received more than $100,000 of compensation from the organization | Form (2017) 8 Part VII 990 DESTINATION MEDICAL CENTER CORPORATION 46-4959371 0.0.0. 0.0.0. 0.0.0. 0 X X X DESTINATION MEDICAL CENTER ECONOMIC DEVELOP 200 1ST STREET SW, ROCHESTER, MN 55905 DEVELOPMENT PLAN PREP/IMPLEMENTATION 2,325,744. MCGRANN SHEA CARNIVAL STRAUGHN & LAMB, CHTD 800 NICOLLET MALL, SUITE 2600, MINNEAPOLIS,LEGAL SERVICES 172,584. 2 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 8 56 DRA F T Noncash contributions included in lines 1a-1f: $ 732009 11-28-17 Total revenue. (A)(B)(C)(D) 1 a b c d e f g h 1 1 1 1 1 1 a b c d e f Co n t r i b u t i o n s , G i f t s , G r a n t s an d O t h e r S i m i l a r A m o u n t s Total. Business Code a b c d e f g 2 Pr o g r a m S e r v i c e Re v e n u e Total. 3 4 5 6 a b c d a b c d 7 a b c 8 a b 9 a b c a b 10 a b c a b Business Code 11 a b c d e Total. Ot h e r R e v e n u e 12 Revenue excludedfrom tax undersections512 - 514 All other contributions, gifts, grants, and similar amounts not included above See instructions. Form (2017) Page Form 990 (2017) Check if Schedule O contains a response or note to any line in this Part VIII ••••••••••••••••••••••••• Total revenue Related orexempt functionrevenue Unrelatedbusinessrevenue Federated campaigns Membership dues ~~~~~~ ~~~~~~~~ Fundraising events Related organizations ~~~~~~~~ ~~~~~~ Government grants (contributions) ~~ Add lines 1a-1f ••••••••••••••••• | All other program service revenue ~~~~~ Add lines 2a-2f ••••••••••••••••• | Investment income (including dividends, interest, and other similar amounts) Income from investment of tax-exempt bond proceeds ~~~~~~~~~~~~~~~~~ | | Royalties ••••••••••••••••••••••• | (i) Real (ii) Personal Gross rents Less: rental expenses Rental income or (loss) Net rental income or (loss) ~~~~~~~ ~~~ ~~ •••••••••••••• | Gross amount from sales of assets other than inventory (i) Securities (ii) Other Less: cost or other basis and sales expenses Gain or (loss) ~~~ ~~~~~~~ Net gain or (loss) ••••••••••••••••••• | Gross income from fundraising events (not including $of contributions reported on line 1c). See Part IV, line 18 ~~~~~~~~~~~~~ Less: direct expenses~~~~~~~~~~ Net income or (loss) from fundraising events ••••• | Gross income from gaming activities. See Part IV, line 19 ~~~~~~~~~~~~~ Less: direct expenses Net income or (loss) from gaming activities ~~~~~~~~~ •••••• | Gross sales of inventory, less returns and allowances ~~~~~~~~~~~~~ Less: cost of goods sold Net income or (loss) from sales of inventory ~~~~~~~~ •••••• | Miscellaneous Revenue All other revenue ~~~~~~~~~~~~~ Add lines 11a-11d ~~~~~~~~~~~~~~~ | |••••••••••••• 9 Part VIII Statement of Revenue 990 DESTINATION MEDICAL CENTER CORPORATION 46-4959371 2,471,264. 2,471,264. 6.6. 2,471,270.0.0.6. 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 9 57 DRA F T Check here if following SOP 98-2 (ASC 958-720) 732010 11-28-17 Total functional expenses. Joint costs. (A)(B)(C)(D) 1 2 3 4 5 6 7 8 9 10 11 a b c d e f g 12 13 14 15 16 17 18 19 20 21 22 23 24 a b c d e 25 26 Section 501(c)(3) and 501(c)(4) organizations must complete all columns. All other organizations must complete column (A). Grants and other assistance to domestic organizations and domestic governments. See Part IV, line 21 Compensation not included above, to disqualified persons (as defined under section 4958(f)(1)) and persons described in section 4958(c)(3)(B) Pension plan accruals and contributions (include section 401(k) and 403(b) employer contributions) Professional fundraising services. See Part IV, line 17 (If line 11g amount exceeds 10% of line 25, column (A) amount, list line 11g expenses on Sch O.) Other expenses. Itemize expenses not covered above. (List miscellaneous expenses in line 24e. If line24e amount exceeds 10% of line 25, column (A)amount, list line 24e expenses on Schedule O.) Add lines 1 through 24e Complete this line only if the organization reported in column (B) joint costs from a combined educational campaign and fundraising solicitation. Form 990 (2017)Page Check if Schedule O contains a response or note to any line in this Part IX •••••••••••••••••••••••••• Total expenses Program serviceexpenses Management andgeneral expenses Fundraisingexpenses ~ Grants and other assistance to domestic individuals. See Part IV, line 22 ~~~~~~~ Grants and other assistance to foreign organizations, foreign governments, and foreign individuals. See Part IV, lines 15 and 16 ~~~ Benefits paid to or for members~~~~~~~ Compensation of current officers, directors, trustees, and key employees ~~~~~~~~ ~~~ Other salaries and wages ~~~~~~~~~~ Other employee benefits ~~~~~~~~~~ Payroll taxes ~~~~~~~~~~~~~~~~ Fees for services (non-employees): Management Legal Accounting Lobbying ~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~ Investment management fees Other. ~~~~~~~~ Advertising and promotion Office expenses Information technology Royalties ~~~~~~~~~ ~~~~~~~~~~~~~~~ ~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~ Occupancy ~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~Travel Payments of travel or entertainment expenses for any federal, state, or local public officials Conferences, conventions, and meetings ~~ Interest Payments to affiliates ~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~ Depreciation, depletion, and amortization Insurance ~~ ~~~~~~~~~~~~~~~~~ All other expenses | Form (2017) Do not include amounts reported on lines 6b, 7b, 8b, 9b, and 10b of Part VIII. 10 Part IX Statement of Functional Expenses 990 DESTINATION MEDICAL CENTER CORPORATION 46-4959371 172,584.172,584. 4,697.4,697. 11,190.11,190. 32,558.32,558. 973.973. 16,136.16,136. PROGRAM COSTS 2,233,132. 2,233,132. 2,471,270. 2,234,105. 237,165.0. 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 10 58 DRA F T 732011 11-28-17 (A)(B) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 1 2 3 4 5 6 7 8 9 10c 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 a b 10a 10b As s e t s Total assets. Li a b i l i t i e s Total liabilities. Organizations that follow SFAS 117 (ASC 958), check here and complete lines 27 through 29, and lines 33 and 34. 27 28 29 Organizations that do not follow SFAS 117 (ASC 958), check here and complete lines 30 through 34. 30 31 32 33 34 Ne t A s s e t s o r F u n d B a l a n c e s Form 990 (2017)Page Check if Schedule O contains a response or note to any line in this Part X ••••••••••••••••••••••••••••• Beginning of year End of year Cash - non-interest-bearing Savings and temporary cash investments Pledges and grants receivable, net ~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~ Accounts receivable, net ~~~~~~~~~~~~~~~~~~~~~~~~~~ Loans and other receivables from current and former officers, directors, trustees, key employees, and highest compensated employees. Complete Part II of Schedule L ~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Loans and other receivables from other disqualified persons (as defined under section 4958(f)(1)), persons described in section 4958(c)(3)(B), and contributing employers and sponsoring organizations of section 501(c)(9) voluntary employees' beneficiary organizations (see instr). Complete Part II of Sch L ~~ Notes and loans receivable, net Inventories for sale or use Prepaid expenses and deferred charges ~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~ Land, buildings, and equipment: cost or other basis. Complete Part VI of Schedule D Less: accumulated depreciation ~~~ ~~~~~~ Investments - publicly traded securities Investments - other securities. See Part IV, line 11 Investments - program-related. See Part IV, line 11 Intangible assets ~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~ ~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Other assets. See Part IV, line 11 ~~~~~~~~~~~~~~~~~~~~~~ Add lines 1 through 15 (must equal line 34) •••••••••• Accounts payable and accrued expenses Grants payable Deferred revenue ~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Tax-exempt bond liabilities Escrow or custodial account liability. Complete Part IV of Schedule D ~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~ Loans and other payables to current and former officers, directors, trustees, key employees, highest compensated employees, and disqualified persons. Complete Part II of Schedule L ~~~~~~~~~~~~~~~~~~~~~~~ Secured mortgages and notes payable to unrelated third parties ~~~~~~ Unsecured notes and loans payable to unrelated third parties ~~~~~~~~ Other liabilities (including federal income tax, payables to related third parties, and other liabilities not included on lines 17-24). Complete Part X of Schedule D ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Add lines 17 through 25 •••••••••••••••••• | Unrestricted net assets Temporarily restricted net assets Permanently restricted net assets ~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~ | Capital stock or trust principal, or current funds Paid-in or capital surplus, or land, building, or equipment fund Retained earnings, endowment, accumulated income, or other funds ~~~~~~~~~~~~~~~ ~~~~~~~~ ~~~~ Total net assets or fund balances ~~~~~~~~~~~~~~~~~~~~~~ Total liabilities and net assets/fund balances •••••••••••••••• Form (2017) 11 Balance SheetPart X 990 DESTINATION MEDICAL CENTER CORPORATION 46-4959371 905.894. 12,998.103,678. 348,507.381,161. 362,410.485,733. 298,412.331,055. 12,998.103,678. 51,000.51,000. 362,410.485,733. X 0.0. 0.0. 362,410.485,733. 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 11 59 DRA F T 732012 11-28-17 1 2 3 4 5 6 7 8 9 10 1 2 3 4 5 6 7 8 9 10 Yes No 1 2 3 a b c 2a 2b 2c a b 3a 3b Form 990 (2017)Page Check if Schedule O contains a response or note to any line in this Part XI ••••••••••••••••••••••••••• Total revenue (must equal Part VIII, column (A), line 12) Total expenses (must equal Part IX, column (A), line 25) Revenue less expenses. Subtract line 2 from line 1 Net assets or fund balances at beginning of year (must equal Part X, line 33, column (A)) ~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~ Net unrealized gains (losses) on investments Donated services and use of facilities Investment expenses Prior period adjustments ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Other changes in net assets or fund balances (explain in Schedule O) Net assets or fund balances at end of year. Combine lines 3 through 9 (must equal Part X, line 33, column (B)) ~~~~~~~~~~~~~~~~~~~ ••••••••••••••••••••••••••••••••••••••••••••••• Check if Schedule O contains a response or note to any line in this Part XII ••••••••••••••••••••••••••• Accounting method used to prepare the Form 990: Cash Accrual Other If the organization changed its method of accounting from a prior year or checked "Other," explain in Schedule O. Were the organization's financial statements compiled or reviewed by an independent accountant? ~~~~~~~~~~~~ If "Yes," check a box below to indicate whether the financial statements for the year were compiled or reviewed on a separate basis, consolidated basis, or both: Separate basis Consolidated basis Both consolidated and separate basis Were the organization's financial statements audited by an independent accountant? ~~~~~~~~~~~~~~~~~~~ If "Yes," check a box below to indicate whether the financial statements for the year were audited on a separate basis, consolidated basis, or both: Separate basis Consolidated basis Both consolidated and separate basis If "Yes" to line 2a or 2b, does the organization have a committee that assumes responsibility for oversight of the audit, review, or compilation of its financial statements and selection of an independent accountant?~~~~~~~~~~~~~~~ If the organization changed either its oversight process or selection process during the tax year, explain in Schedule O. As a result of a federal award, was the organization required to undergo an audit or audits as set forth in the Single Audit Act and OMB Circular A-133? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ If "Yes," did the organization undergo the required audit or audits? If the organization did not undergo the required audit or audits, explain why in Schedule O and describe any steps taken to undergo such audits •••••••••••••••• Form (2017) 12 Part XI Reconciliation of Net Assets Part XII Financial Statements and Reporting 990 DESTINATION MEDICAL CENTER CORPORATION 46-4959371 2,471,270. 2,471,270. 0. 0. 0. 0. X X X X X X X 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 12 60 DRA F T (iv) Is the organization listedin your governing document? OMB No. 1545-0047 Department of the Treasury Internal Revenue Service 732021 10-06-17 (i)(iii)(v)(vi)(ii) Name of supported organization Type of organization (described on lines 1-10 above (see instructions)) Amount of monetary support (see instructions) Amount of other support (see instructions) EIN (Form 990 or 990-EZ)Complete if the organization is a section 501(c)(3) organization or a section 4947(a)(1) nonexempt charitable trust. | Attach to Form 990 or Form 990-EZ. | Go to www.irs.gov/Form990 for instructions and the latest information. Open to Public Inspection Name of the organization Employer identification number 1 2 3 4 5 6 7 8 9 10 11 12 section 170(b)(1)(A)(i). section 170(b)(1)(A)(ii). section 170(b)(1)(A)(iii). section 170(b)(1)(A)(iii). section 170(b)(1)(A)(iv). section 170(b)(1)(A)(v). section 170(b)(1)(A)(vi). section 170(b)(1)(A)(vi). section 170(b)(1)(A)(ix) section 509(a)(2). section 509(a)(4). section 509(a)(1) section 509(a)(2) section 509(a)(3). a b c d e f g Type I. You must complete Part IV, Sections A and B. Type II. You must complete Part IV, Sections A and C. Type III functionally integrated. You must complete Part IV, Sections A, D, and E. Type III non-functionally integrated. You must complete Part IV, Sections A and D, and Part V. Yes No Total For Paperwork Reduction Act Notice, see the Instructions for Form 990 or 990-EZ.Schedule A (Form 990 or 990-EZ) 2017 (All organizations must complete this part.) See instructions. The organization is not a private foundation because it is: (For lines 1 through 12, check only one box.) A church, convention of churches, or association of churches described in A school described in (Attach Schedule E (Form 990 or 990-EZ).) A hospital or a cooperative hospital service organization described in A medical research organization operated in conjunction with a hospital described in Enter the hospital's name, city, and state: An organization operated for the benefit of a college or university owned or operated by a governmental unit described in (Complete Part II.) A federal, state, or local government or governmental unit described in An organization that normally receives a substantial part of its support from a governmental unit or from the general public described in (Complete Part II.) A community trust described in (Complete Part II.) An agricultural research organization described in operated in conjunction with a land-grant college or university or a non-land-grant college of agriculture (see instructions). Enter the name, city, and state of the college or university: An organization that normally receives: (1) more than 33 1/3% of its support from contributions, membership fees, and gross receipts from activities related to its exempt functions - subject to certain exceptions, and (2) no more than 33 1/3% of its support from gross investment income and unrelated business taxable income (less section 511 tax) from businesses acquired by the organization after June 30, 1975. See (Complete Part III.) An organization organized and operated exclusively to test for public safety. See An organization organized and operated exclusively for the benefit of, to perform the functions of, or to carry out the purposes of one or more publicly supported organizations described in or . See Check the box in lines 12a through 12d that describes the type of supporting organization and complete lines 12e, 12f, and 12g. A supporting organization operated, supervised, or controlled by its supported organization(s), typically by giving the supported organization(s) the power to regularly appoint or elect a majority of the directors or trustees of the supporting organization. A supporting organization supervised or controlled in connection with its supported organization(s), by having control or management of the supporting organization vested in the same persons that control or manage the supported organization(s). A supporting organization operated in connection with, and functionally integrated with, its supported organization(s) (see instructions). A supporting organization operated in connection with its supported organization(s) that is not functionally integrated. The organization generally must satisfy a distribution requirement and an attentiveness requirement (see instructions). Check this box if the organization received a written determination from the IRS that it is a Type I, Type II, Type III functionally integrated, or Type III non-functionally integrated supporting organization. Enter the number of supported organizations ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Provide the following information about the supported organization(s). LHA SCHEDULE A Part I Reason for Public Charity Status Public Charity Status and Public Support 2017 DESTINATION MEDICAL CENTER CORPORATION 46-4959371 X 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 13 61 DRA F T Subtract line 5 from line 4. 732022 10-06-17 Calendar year (or fiscal year beginning in) Calendar year (or fiscal year beginning in) | 2 (a) (b) (c) (d) (e) (f) 1 2 3 4 5 Total. 6 Public support. (a) (b) (c) (d) (e) (f) 7 8 9 10 11 12 13 Total support. 12 First five years. stop here 14 15 14 15 16 17 18 a b a b 33 1/3% support test - 2017. stop here. 33 1/3% support test - 2016. stop here. 10% -facts-and-circumstances test - 2017. stop here. 10% -facts-and-circumstances test - 2016. stop here. Private foundation. Schedule A (Form 990 or 990-EZ) 2017 | Add lines 7 through 10 Schedule A (Form 990 or 990-EZ) 2017 Page (Complete only if you checked the box on line 5, 7, or 8 of Part I or if the organization failed to qualify under Part III. If the organization fails to qualify under the tests listed below, please complete Part III.) 2013 2014 2015 2016 2017 Total Gifts, grants, contributions, and membership fees received. (Do not include any "unusual grants.")~~ Tax revenues levied for the organ- ization's benefit and either paid to or expended on its behalf ~~~~ The value of services or facilities furnished by a governmental unit to the organization without charge ~ Add lines 1 through 3 ~~~ The portion of total contributions by each person (other than a governmental unit or publicly supported organization) included on line 1 that exceeds 2% of the amount shown on line 11, column (f)~~~~~~~~~~~~ 2013 2014 2015 2016 2017 Total Amounts from line 4 ~~~~~~~ Gross income from interest, dividends, payments received on securities loans, rents, royalties, and income from similar sources ~ Net income from unrelated business activities, whether or not the business is regularly carried on ~ Other income. Do not include gain or loss from the sale of capital assets (Explain in Part VI.) ~~~~ Gross receipts from related activities, etc. (see instructions) ~~~~~~~~~~~~~~~~~~~~~~~ If the Form 990 is for the organization's first, second, third, fourth, or fifth tax year as a section 501(c)(3) organization, check this box and •••••••••••••••••••••••••••••••••••••••••••••| ~~~~~~~~~~~~Public support percentage for 2017 (line 6, column (f) divided by line 11, column (f)) Public support percentage from 2016 Schedule A, Part II, line 14 % %~~~~~~~~~~~~~~~~~~~~~ If the organization did not check the box on line 13, and line 14 is 33 1/3% or more, check this box and The organization qualifies as a publicly supported organization ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ | If the organization did not check a box on line 13 or 16a, and line 15 is 33 1/3% or more, check this box and The organization qualifies as a publicly supported organization ~~~~~~~~~~~~~~~~~~~~~~~~~~~~ | If the organization did not check a box on line 13, 16a, or 16b, and line 14 is 10% or more, and if the organization meets the "facts-and-circumstances" test, check this box and Explain in Part VI how the organization meets the "facts-and-circumstances" test. The organization qualifies as a publicly supported organization~~~~~~~~~~~~~~~ | If the organization did not check a box on line 13, 16a, 16b, or 17a, and line 15 is 10% or more, and if the organization meets the "facts-and-circumstances" test, check this box and Explain in Part VI how the organization meets the "facts-and-circumstances" test. The organization qualifies as a publicly supported organization ~~~~~~~~ | If the organization did not check a box on line 13, 16a, 16b, 17a, or 17b, check this box and see instructions ••• | Part II Support Schedule for Organizations Described in Sections 170(b)(1)(A)(iv) and 170(b)(1)(A)(vi) Section A. Public Support Section B. Total Support Section C. Computation of Public Support Percentage DESTINATION MEDICAL CENTER CORPORATION 46-4959371 5,416,446. 3,605,187. 2,288,339. 2,471,264. 13,781,236. 5,416,446. 3,605,187. 2,288,339. 2,471,264. 13,781,236. 13,781,236. 5,416,446. 3,605,187. 2,288,339. 2,471,264. 13,781,236. 1.1.1.6.9. 13,781,245. X 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 14 62 DRA F T (Subtract line 7c from line 6.) Amounts included on lines 2 and 3 received from other than disqualified persons that exceed the greater of $5,000 or 1% of the amount on line 13 for the year (Add lines 9, 10c, 11, and 12.) 732023 10-06-17 Calendar year (or fiscal year beginning in) | Calendar year (or fiscal year beginning in) | Total support. 3 (a) (b) (c) (d) (e) (f) 1 2 3 4 5 6 7 Total. a b c 8 Public support. (a) (b) (c) (d) (e) (f) 9 10a b c 11 12 13 14 First five years. stop here 15 16 15 16 17 18 19 20 2017 2016 17 18 a b 33 1/3% support tests - 2017. stop here. 33 1/3% support tests - 2016. stop here. Private foundation. Schedule A (Form 990 or 990-EZ) 2017 Unrelated business taxable income (less section 511 taxes) from businesses acquired after June 30, 1975 Schedule A (Form 990 or 990-EZ) 2017 Page (Complete only if you checked the box on line 10 of Part I or if the organization failed to qualify under Part II. If the organization fails to qualify under the tests listed below, please complete Part II.) 2013 2014 2015 2016 2017 Total Gifts, grants, contributions, and membership fees received. (Do not include any "unusual grants.")~~ Gross receipts from admissions, merchandise sold or services per- formed, or facilities furnished in any activity that is related to the organization's tax-exempt purpose Gross receipts from activities that are not an unrelated trade or bus- iness under section 513 ~~~~~ Tax revenues levied for the organ- ization's benefit and either paid to or expended on its behalf ~~~~ The value of services or facilities furnished by a governmental unit to the organization without charge ~ ~~~ Add lines 1 through 5 Amounts included on lines 1, 2, and 3 received from disqualified persons ~~~~~~ Add lines 7a and 7b ~~~~~~~ 2013 2014 2015 2016 2017 Total Amounts from line 6 ~~~~~~~ Gross income from interest, dividends, payments received on securities loans, rents, royalties, and income from similar sources ~ ~~~~ Add lines 10a and 10b ~~~~~~ Net income from unrelated businessactivities not included in line 10b, whether or not the business is regularly carried on ~~~~~~~ Other income. Do not include gainor loss from the sale of capitalassets (Explain in Part VI.)~~~~ If the Form 990 is for the organization's first, second, third, fourth, or fifth tax year as a section 501(c)(3) organization, check this box and ••••••••••••••••••••••••••••••••••••••••••••••••••••| Public support percentage for 2017 (line 8, column (f) divided by line 13, column (f)) Public support percentage from 2016 Schedule A, Part III, line 15 ~~~~~~~~~~~~% %•••••••••••••••••••• Investment income percentage for (line 10c, column (f) divided by line 13, column (f)) Investment income percentage from Schedule A, Part III, line 17 ~~~~~~~~% %~~~~~~~~~~~~~~~~~~ If the organization did not check the box on line 14, and line 15 is more than 33 1/3%, and line 17 is not more than 33 1/3%, check this box and The organization qualifies as a publicly supported organization ~~~~~~~~~~ | If the organization did not check a box on line 14 or line 19a, and line 16 is more than 33 1/3%, and line 18 is not more than 33 1/3%, check this box and The organization qualifies as a publicly supported organization ~~~~ | If the organization did not check a box on line 14, 19a, or 19b, check this box and see instructions •••••••• | Part III Support Schedule for Organizations Described in Section 509(a)(2) Section A. Public Support Section B. Total Support Section C. Computation of Public Support Percentage Section D. Computation of Investment Income Percentage DESTINATION MEDICAL CENTER CORPORATION 46-4959371 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 15 63 DRA F T 732024 10-06-17 4 Yes No 1 2 3 4 5 6 7 8 9 10 Part VI 1 2 3a 3b 3c 4a 4b 4c 5a 5b 5c 6 7 8 9a 9b 9c 10a 10b Part VI a b c a b c a b c a b c a b Part VI Part VI Part VI Part VI Part VI, Type I or Type II only. Substitutions only. Part VI. Part VI. Part VI. Part VI. Schedule A (Form 990 or 990-EZ) 2017 If "No," describe in how the supported organizations are designated. If designated by class or purpose, describe the designation. If historic and continuing relationship, explain. If "Yes," explain in how the organization determined that the supported organization was described in section 509(a)(1) or (2). If "Yes," answer (b) and (c) below. If "Yes," describe in when and how the organization made the determination. If "Yes," explain in what controls the organization put in place to ensure such use. If "Yes," and if you checked 12a or 12b in Part I, answer (b) and (c) below. If "Yes," describe in how the organization had such control and discretion despite being controlled or supervised by or in connection with its supported organizations. If "Yes," explain in what controls the organization used to ensure that all support to the foreign supported organization was used exclusively for section 170(c)(2)(B) purposes. If "Yes," answer (b) and (c) below (if applicable). Also, provide detail in including (i) the names and EIN numbers of the supported organizations added, substituted, or removed; (ii) the reasons for each such action; (iii) the authority under the organization's organizing document authorizing such action; and (iv) how the action was accomplished (such as by amendment to the organizing document). If "Yes," provide detail in If "Yes," complete Part I of Schedule L (Form 990 or 990-EZ). If "Yes," complete Part I of Schedule L (Form 990 or 990-EZ). If "Yes," provide detail in If "Yes," provide detail in If "Yes," provide detail in If "Yes," answer 10b below. (Use Schedule C, Form 4720, to determine whether the organization had excess business holdings.) Schedule A (Form 990 or 990-EZ) 2017 Page (Complete only if you checked a box in line 12 on Part I. If you checked 12a of Part I, complete Sections A and B. If you checked 12b of Part I, complete Sections A and C. If you checked 12c of Part I, complete Sections A, D, and E. If you checked 12d of Part I, complete Sections A and D, and complete Part V.) Are all of the organization's supported organizations listed by name in the organization's governing documents? Did the organization have any supported organization that does not have an IRS determination of status under section 509(a)(1) or (2)? Did the organization have a supported organization described in section 501(c)(4), (5), or (6)? Did the organization confirm that each supported organization qualified under section 501(c)(4), (5), or (6) and satisfied the public support tests under section 509(a)(2)? Did the organization ensure that all support to such organizations was used exclusively for section 170(c)(2)(B) purposes? Was any supported organization not organized in the United States ("foreign supported organization")? Did the organization have ultimate control and discretion in deciding whether to make grants to the foreign supported organization? Did the organization support any foreign supported organization that does not have an IRS determination under sections 501(c)(3) and 509(a)(1) or (2)? Did the organization add, substitute, or remove any supported organizations during the tax year? Was any added or substituted supported organization part of a class already designated in the organization's organizing document? Was the substitution the result of an event beyond the organization's control? Did the organization provide support (whether in the form of grants or the provision of services or facilities) to anyone other than (i) its supported organizations, (ii) individuals that are part of the charitable class benefited by one or more of its supported organizations, or (iii) other supporting organizations that also support or benefit one or more of the filing organization's supported organizations? Did the organization provide a grant, loan, compensation, or other similar payment to a substantial contributor (defined in section 4958(c)(3)(C)), a family member of a substantial contributor, or a 35% controlled entity with regard to a substantial contributor? Did the organization make a loan to a disqualified person (as defined in section 4958) not described in line 7? Was the organization controlled directly or indirectly at any time during the tax year by one or more disqualified persons as defined in section 4946 (other than foundation managers and organizations described in section 509(a)(1) or (2))? Did one or more disqualified persons (as defined in line 9a) hold a controlling interest in any entity in which the supporting organization had an interest? Did a disqualified person (as defined in line 9a) have an ownership interest in, or derive any personal benefit from, assets in which the supporting organization also had an interest? Was the organization subject to the excess business holdings rules of section 4943 because of section 4943(f) (regarding certain Type II supporting organizations, and all Type III non-functionally integrated supporting organizations)? Did the organization have any excess business holdings in the tax year? Part IV Supporting Organizations Section A. All Supporting Organizations DESTINATION MEDICAL CENTER CORPORATION 46-4959371 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 16 64 DRA F T 732025 10-06-17 5 Yes No 11 a b c 11a 11b 11cPart VI. Yes No 1 2 Part VI 1 2 Part VI Yes No 1 Part VI 1 Yes No 1 2 3 1 2 3 Part VI Part VI 1 2 3 (see instructions). a b c line 2 line 3 Part VI Answer (a) and (b) below.Yes No a b a b Part VI identify those supported organizations and explain 2a 2b 3a 3b Part VI Answer (a) and (b) below. Part VI. Part VI Schedule A (Form 990 or 990-EZ) 2017 If "Yes" to a, b, or c, provide detail in If "No," describe in how the supported organization(s) effectively operated, supervised, or controlled the organization's activities. If the organization had more than one supported organization, describe how the powers to appoint and/or remove directors or trustees were allocated among the supported organizations and what conditions or restrictions, if any, applied to such powers during the tax year. If "Yes," explain in how providing such benefit carried out the purposes of the supported organization(s) that operated, supervised, or controlled the supporting organization. If "No," describe in how control or management of the supporting organization was vested in the same persons that controlled or managed the supported organization(s). If "No," explain in how the organization maintained a close and continuous working relationship with the supported organization(s). If "Yes," describe in the role the organization's supported organizations played in this regard. Check the box next to the method that the organization used to satisfy the Integral Part Test during the year Complete below. Complete below. Describe in how you supported a government entity (see instructions). If "Yes," then in how these activities directly furthered their exempt purposes, how the organization was responsive to those supported organizations, and how the organization determined that these activities constituted substantially all of its activities. If "Yes," explain in the reasons for the organization's position that its supported organization(s) would have engaged in these activities but for the organization's involvement. Provide details in If "Yes," describe in the role played by the organization in this regard. Schedule A (Form 990 or 990-EZ) 2017 Page Has the organization accepted a gift or contribution from any of the following persons? A person who directly or indirectly controls, either alone or together with persons described in (b) and (c) below, the governing body of a supported organization? A family member of a person described in (a) above? A 35% controlled entity of a person described in (a) or (b) above? Did the directors, trustees, or membership of one or more supported organizations have the power to regularly appoint or elect at least a majority of the organization's directors or trustees at all times during the tax year? Did the organization operate for the benefit of any supported organization other than the supported organization(s) that operated, supervised, or controlled the supporting organization? Were a majority of the organization's directors or trustees during the tax year also a majority of the directors or trustees of each of the organization's supported organization(s)? Did the organization provide to each of its supported organizations, by the last day of the fifth month of the organization's tax year, (i) a written notice describing the type and amount of support provided during the prior tax year, (ii) a copy of the Form 990 that was most recently filed as of the date of notification, and (iii) copies of the organization's governing documents in effect on the date of notification, to the extent not previously provided? Were any of the organization's officers, directors, or trustees either (i) appointed or elected by the supported organization(s) or (ii) serving on the governing body of a supported organization? By reason of the relationship described in (2), did the organization's supported organizations have a significant voice in the organization's investment policies and in directing the use of the organization's income or assets at all times during the tax year? The organization satisfied the Activities Test. The organization is the parent of each of its supported organizations. The organization supported a governmental entity. Activities Test. Did substantially all of the organization's activities during the tax year directly further the exempt purposes of the supported organization(s) to which the organization was responsive? Did the activities described in (a) constitute activities that, but for the organization's involvement, one or more of the organization's supported organization(s) would have been engaged in? Parent of Supported Organizations. Did the organization have the power to regularly appoint or elect a majority of the officers, directors, or trustees of each of the supported organizations? Did the organization exercise a substantial degree of direction over the policies, programs, and activities of each of its supported organizations? (continued)Part IV Supporting Organizations Section B. Type I Supporting Organizations Section C. Type II Supporting Organizations Section D. All Type III Supporting Organizations Section E. Type III Functionally Integrated Supporting Organizations DESTINATION MEDICAL CENTER CORPORATION 46-4959371 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 17 65 DRA F T 732026 10-06-17 6 1 See instructions. Section A - Adjusted Net Income 1 2 3 4 5 6 7 8 1 2 3 4 5 6 7 8Adjusted Net Income Section B - Minimum Asset Amount 1 2 3 4 5 6 7 8 a b c d e 1a 1b 1c 1d 2 3 4 5 6 7 8 Total Discount Part VI Minimum Asset Amount Section C - Distributable Amount 1 2 3 4 5 6 7 1 2 3 4 5 6 Distributable Amount. Schedule A (Form 990 or 990-EZ) 2017 Schedule A (Form 990 or 990-EZ) 2017 Page Check here if the organization satisfied the Integral Part Test as a qualifying trust on Nov. 20, 1970 (explain in Part VI.) All other Type III non-functionally integrated supporting organizations must complete Sections A through E. (B) Current Year (optional)(A) Prior Year Net short-term capital gain Recoveries of prior-year distributions Other gross income (see instructions) Add lines 1 through 3 Depreciation and depletion Portion of operating expenses paid or incurred for production or collection of gross income or for management, conservation, or maintenance of property held for production of income (see instructions) Other expenses (see instructions) (subtract lines 5, 6, and 7 from line 4) (B) Current Year (optional)(A) Prior Year Aggregate fair market value of all non-exempt-use assets (see instructions for short tax year or assets held for part of year): Average monthly value of securities Average monthly cash balances Fair market value of other non-exempt-use assets (add lines 1a, 1b, and 1c) claimed for blockage or other factors (explain in detail in ): Acquisition indebtedness applicable to non-exempt-use assets Subtract line 2 from line 1d Cash deemed held for exempt use. Enter 1-1/2% of line 3 (for greater amount, see instructions) Net value of non-exempt-use assets (subtract line 4 from line 3) Multiply line 5 by .035 Recoveries of prior-year distributions (add line 7 to line 6) Current Year Adjusted net income for prior year (from Section A, line 8, Column A) Enter 85% of line 1 Minimum asset amount for prior year (from Section B, line 8, Column A) Enter greater of line 2 or line 3 Income tax imposed in prior year Subtract line 5 from line 4, unless subject to emergency temporary reduction (see instructions) Check here if the current year is the organization's first as a non-functionally integrated Type III supporting organization (see instructions). Part V Type III Non-Functionally Integrated 509(a)(3) Supporting Organizations DESTINATION MEDICAL CENTER CORPORATION 46-4959371 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 18 66 DRA F T 732027 10-06-17 7 Section D - Distributions Current Year 1 2 3 4 5 6 7 8 9 10 Part VI Total annual distributions. Part VI (i) Excess Distributions (ii) Underdistributions Pre-2017 (iii) Distributable Amount for 2017Section E - Distribution Allocations (see instructions) 1 2 3 4 5 6 7 8 Part VI a b c d e f g h i j Total a b c Part VI. Part VI Excess distributions carryover to 2018. a b c d e Schedule A (Form 990 or 990-EZ) 2017 Schedule A (Form 990 or 990-EZ) 2017 Page Amounts paid to supported organizations to accomplish exempt purposes Amounts paid to perform activity that directly furthers exempt purposes of supported organizations, in excess of income from activity Administrative expenses paid to accomplish exempt purposes of supported organizations Amounts paid to acquire exempt-use assets Qualified set-aside amounts (prior IRS approval required) Other distributions (describe in ). See instructions. Add lines 1 through 6. Distributions to attentive supported organizations to which the organization is responsive (provide details in ). See instructions. Distributable amount for 2017 from Section C, line 6 Line 8 amount divided by line 9 amount Distributable amount for 2017 from Section C, line 6 Underdistributions, if any, for years prior to 2017 (reason- able cause required- explain in ). See instructions. Excess distributions carryover, if any, to 2017 From 2013 From 2014 From 2015 From 2016 of lines 3a through e Applied to underdistributions of prior years Applied to 2017 distributable amount Carryover from 2012 not applied (see instructions) Remainder. Subtract lines 3g, 3h, and 3i from 3f. Distributions for 2017 from Section D, line 7:$ Applied to underdistributions of prior years Applied to 2017 distributable amount Remainder. Subtract lines 4a and 4b from 4. Remaining underdistributions for years prior to 2017, if any. Subtract lines 3g and 4a from line 2. For result greater than zero, explain in See instructions. Remaining underdistributions for 2017. Subtract lines 3h and 4b from line 1. For result greater than zero, explain in . See instructions. Add lines 3j and 4c. Breakdown of line 7: Excess from 2013 Excess from 2014 Excess from 2015 Excess from 2016 Excess from 2017 (continued) Part V Type III Non-Functionally Integrated 509(a)(3) Supporting Organizations DESTINATION MEDICAL CENTER CORPORATION 46-4959371 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 19 67 DRA F T 732028 10-06-17 8 Schedule A (Form 990 or 990-EZ) 2017 Schedule A (Form 990 or 990-EZ) 2017 Page Provide the explanations required by Part II, line 10; Part II, line 17a or 17b; Part III, line 12; Part IV, Section A, lines 1, 2, 3b, 3c, 4b, 4c, 5a, 6, 9a, 9b, 9c, 11a, 11b, and 11c; Part IV, Section B, lines 1 and 2; Part IV, Section C, line 1; Part IV, Section D, lines 2 and 3; Part IV, Section E, lines 1c, 2a, 2b, 3a, and 3b; Part V, line 1; Part V, Section B, line 1e; Part V, Section D, lines 5, 6, and 8; and Part V, Section E, lines 2, 5, and 6. Also complete this part for any additional information. (See instructions.) Part VI Supplemental Information. DESTINATION MEDICAL CENTER CORPORATION 46-4959371 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 20 68 DRA F T OMB No. 1545-0047 Department of the Treasury Internal Revenue Service 723451 11-01-17 Schedule B (Form 990, 990-EZ, or 990-PF) (2017) (Form 990, 990-EZ,or 990-PF)| Attach to Form 990, Form 990-EZ, or Form 990-PF. | Go to www.irs.gov/Form990 for the latest information. Name of the organization Employer identification number Organization type Filers of:Section: not General Rule Special Rule. Note: General Rule Special Rules (1) (2) General Rule Caution: must For Paperwork Reduction Act Notice, see the instructions for Form 990, 990-EZ, or 990-PF. exclusively exclusively exclusively nonexclusively (check one): Form 990 or 990-EZ 501(c)( ) (enter number) organization 4947(a)(1) nonexempt charitable trust treated as a private foundation 527 political organization Form 990-PF 501(c)(3) exempt private foundation 4947(a)(1) nonexempt charitable trust treated as a private foundation 501(c)(3) taxable private foundation Check if your organization is covered by the or a Only a section 501(c)(7), (8), or (10) organization can check boxes for both the General Rule and a Special Rule. See instructions. For an organization filing Form 990, 990-EZ, or 990-PF that received, during the year, contributions totaling $5,000 or more (in money or property) from any one contributor. Complete Parts I and II. See instructions for determining a contributor's total contributions. For an organization described in section 501(c)(3) filing Form 990 or 990-EZ that met the 33 1/3% support test of the regulations under sections 509(a)(1) and 170(b)(1)(A)(vi), that checked Schedule A (Form 990 or 990-EZ), Part II, line 13, 16a, or 16b, and that received from any one contributor, during the year, total contributions of the greater of $5,000; or 2% of the amount on (i) Form 990, Part VIII, line 1h; or (ii) Form 990-EZ, line 1. Complete Parts I and II. For an organization described in section 501(c)(7), (8), or (10) filing Form 990 or 990-EZ that received from any one contributor, during the year, total contributions of more than $1,000 for religious, charitable, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals. Complete Parts I, II, and III. For an organization described in section 501(c)(7), (8), or (10) filing Form 990 or 990-EZ that received from any one contributor, during the year, contributions for religious, charitable, etc., purposes, but no such contributions totaled more than $1,000. If this box is checked, enter here the total contributions that were received during the year for an religious, charitable, etc., purpose. Don't complete any of the parts unless the applies to this organization because it received religious, charitable, etc., contributions totaling $5,000 or more during the year ~~~~~~~~~~~~~~~ | $ An organization that isn't covered by the General Rule and/or the Special Rules doesn't file Schedule B (Form 990, 990-EZ, or 990-PF), but it answer "No" on Part IV, line 2, of its Form 990; or check the box on line H of its Form 990-EZ or on its Form 990-PF, Part I, line 2, to certify that it doesn't meet the filing requirements of Schedule B (Form 990, 990-EZ, or 990-PF). LHA Schedule B Schedule of Contributors 2017 DESTINATION MEDICAL CENTER CORPORATION 46-4959371 X 3 X 69 DRA F T 723452 11-01-17 Name of organization Employer identification number Schedule B (Form 990, 990-EZ, or 990-PF) (2017) (a) No. (b) Name, address, and ZIP + 4 (c) Total contributions (d) Type of contribution Person Payroll Noncash (a) No. (b) Name, address, and ZIP + 4 (c) Total contributions (d) Type of contribution Person Payroll Noncash (a) No. (b) Name, address, and ZIP + 4 (c) Total contributions (d) Type of contribution Person Payroll Noncash (a) No. (b) Name, address, and ZIP + 4 (c) Total contributions (d) Type of contribution Person Payroll Noncash (a) No. (b) Name, address, and ZIP + 4 (c) Total contributions (d) Type of contribution Person Payroll Noncash (a) No. (b) Name, address, and ZIP + 4 (c) Total contributions (d) Type of contribution Person Payroll Noncash Schedule B (Form 990, 990-EZ, or 990-PF) (2017)Page (see instructions). Use duplicate copies of Part I if additional space is needed. $ (Complete Part II for noncash contributions.) $ (Complete Part II for noncash contributions.) $ (Complete Part II for noncash contributions.) $ (Complete Part II for noncash contributions.) $ (Complete Part II for noncash contributions.) $ (Complete Part II for noncash contributions.) 2 Part I Contributors DESTINATION MEDICAL CENTER CORPORATION 46-4959371 1 CITY OF ROCHESTER X 201 4TH STREET SE 2,471,264. ROCHESTER, MN 55904 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 22 70 DRA F T 723453 11-01-17 Name of organization Employer identification number Schedule B (Form 990, 990-EZ, or 990-PF) (2017) (a) No. from Part I (c) FMV (or estimate) (See instructions.) (b) Description of noncash property given (d) Date received (a) No. from Part I (c) FMV (or estimate) (See instructions.) (b) Description of noncash property given (d) Date received (a) No. from Part I (c) FMV (or estimate) (See instructions.) (b) Description of noncash property given (d) Date received (a) No. from Part I (c) FMV (or estimate) (See instructions.) (b) Description of noncash property given (d) Date received (a) No. from Part I (c) FMV (or estimate) (See instructions.) (b) Description of noncash property given (d) Date received (a) No. from Part I (c) FMV (or estimate) (See instructions.) (b) Description of noncash property given (d) Date received Schedule B (Form 990, 990-EZ, or 990-PF) (2017)Page (see instructions). Use duplicate copies of Part II if additional space is needed. $ $ $ $ $ $ 3 Part II Noncash Property DESTINATION MEDICAL CENTER CORPORATION 46-4959371 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 23 71 DRA F T (Enter this info. once.) For organizations completing Part III, enter the total of exclusively religious, charitable, etc., contributions of $1,000 or less for the year. 723454 11-01-17 Name of organization Employer identification number religious, charitable, etc., contributions to organizations described in section 501(c)(7), (8), or (10) that total more than $1,000 forthe year from any one contributor. (a) (e) and Schedule B (Form 990, 990-EZ, or 990-PF) (2017) (a) No.fromPart I (b) Purpose of gift (c) Use of gift (d) Description of how gift is held (e) Transfer of gift Transferee's name, address, and ZIP + 4 Relationship of transferor to transferee (a) No.fromPart I (b) Purpose of gift (c) Use of gift (d) Description of how gift is held (e) Transfer of gift Transferee's name, address, and ZIP + 4 Relationship of transferor to transferee (a) No.fromPart I (b) Purpose of gift (c) Use of gift (d) Description of how gift is held (e) Transfer of gift Transferee's name, address, and ZIP + 4 Relationship of transferor to transferee (a) No.fromPart I (b) Purpose of gift (c) Use of gift (d) Description of how gift is held (e) Transfer of gift Transferee's name, address, and ZIP + 4 Relationship of transferor to transferee Complete columns through the following line entry. Schedule B (Form 990, 990-EZ, or 990-PF) (2017)Page | $ Use duplicate copies of Part III if additional space is needed. Exclusively 4 Part III DESTINATION MEDICAL CENTER CORPORATION 46-4959371 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 24 72 DRA F T OMB No. 1545-0047 Department of the Treasury Internal Revenue Service 732051 10-09-17 Held at the End of the Tax Year (Form 990)| Complete if the organization answered "Yes" on Form 990,Part IV, line 6, 7, 8, 9, 10, 11a, 11b, 11c, 11d, 11e, 11f, 12a, or 12b.| Attach to Form 990.|Go to www.irs.gov/Form990 for instructions and the latest information. Open to PublicInspection Name of the organization Employer identification number (a) (b) 1 2 3 4 5 6 Yes No Yes No 1 2 3 4 5 6 7 8 9 a b c d 2a 2b 2c 2d Yes No Yes No 1 2 a b (i) (ii) a b For Paperwork Reduction Act Notice, see the Instructions for Form 990.Schedule D (Form 990) 2017 Complete if the organization answered "Yes" on Form 990, Part IV, line 6. Donor advised funds Funds and other accounts Total number at end of year Aggregate value of contributions to (during year) Aggregate value of grants from (during year) Aggregate value at end of year ~~~~~~~~~~~~~~~ ~~~~ ~~~~~~ ~~~~~~~~~~~~~ Did the organization inform all donors and donor advisors in writing that the assets held in donor advised funds are the organization's property, subject to the organization's exclusive legal control?~~~~~~~~~~~~~~~~~~ Did the organization inform all grantees, donors, and donor advisors in writing that grant funds can be used only for charitable purposes and not for the benefit of the donor or donor advisor, or for any other purpose conferring impermissible private benefit?•••••••••••••••••••••••••••••••••••••••••••• Complete if the organization answered "Yes" on Form 990, Part IV, line 7. Purpose(s) of conservation easements held by the organization (check all that apply). Preservation of land for public use (e.g., recreation or education) Protection of natural habitat Preservation of open space Preservation of a historically important land area Preservation of a certified historic structure Complete lines 2a through 2d if the organization held a qualified conservation contribution in the form of a conservation easement on the last day of the tax year. Total number of conservation easements Total acreage restricted by conservation easements ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~ Number of conservation easements on a certified historic structure included in (a) Number of conservation easements included in (c) acquired after 7/25/06, and not on a historic structure listed in the National Register ~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Number of conservation easements modified, transferred, released, extinguished, or terminated by the organization during the tax year | Number of states where property subject to conservation easement is located | Does the organization have a written policy regarding the periodic monitoring, inspection, handling of violations, and enforcement of the conservation easements it holds? ~~~~~~~~~~~~~~~~~~~~~~~~~ Staff and volunteer hours devoted to monitoring, inspecting, handling of violations, and enforcing conservation easements during the year | Amount of expenses incurred in monitoring, inspecting, handling of violations, and enforcing conservation easements during the year | $ Does each conservation easement reported on line 2(d) above satisfy the requirements of section 170(h)(4)(B)(i) and section 170(h)(4)(B)(ii)? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ In Part XIII, describe how the organization reports conservation easements in its revenue and expense statement, and balance sheet, and include, if applicable, the text of the footnote to the organization's financial statements that describes the organization's accounting for conservation easements. Complete if the organization answered "Yes" on Form 990, Part IV, line 8. If the organization elected, as permitted under SFAS 116 (ASC 958), not to report in its revenue statement and balance sheet works of art, historical treasures, or other similar assets held for public exhibition, education, or research in furtherance of public service, provide, in Part XIII, the text of the footnote to its financial statements that describes these items. If the organization elected, as permitted under SFAS 116 (ASC 958), to report in its revenue statement and balance sheet works of art, historical treasures, or other similar assets held for public exhibition, education, or research in furtherance of public service, provide the following amounts relating to these items: Revenue included on Form 990, Part VIII, line 1 Assets included in Form 990, Part X ~~~~~~~~~~~~~~~~~~~~~~~~~~~~ | $ $~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ | If the organization received or held works of art, historical treasures, or other similar assets for financial gain, provide the following amounts required to be reported under SFAS 116 (ASC 958) relating to these items: Revenue included on Form 990, Part VIII, line 1 Assets included in Form 990, Part X ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ | $ $••••••••••••••••••••••••••••••••••• | LHA Part I Organizations Maintaining Donor Advised Funds or Other Similar Funds or Accounts. Part II Conservation Easements. Part III Organizations Maintaining Collections of Art, Historical Treasures, or Other Similar Assets. SCHEDULE D Supplemental Financial Statements 2017 DESTINATION MEDICAL CENTER CORPORATION 46-4959371 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 25 73 DRA F T 732052 10-09-17 3 4 5 a b c d e Yes No 1 2 a b c d e f a b Yes No 1c 1d 1e 1f Yes No (a) (b) (c) (d) (e) 1 2 3 4 a b c d e f g a b c a b Yes No (i) (ii) 3a(i) 3a(ii) 3b (a) (b) (c) (d) 1a b c d e Total. Schedule D (Form 990) 2017 (continued) (Column (d) must equal Form 990, Part X, column (B), line 10c.) Two years back Three years back Four years back Schedule D (Form 990) 2017 Page Using the organization's acquisition, accession, and other records, check any of the following that are a significant use of its collection items (check all that apply): Public exhibition Scholarly research Preservation for future generations Loan or exchange programs Other Provide a description of the organization's collections and explain how they further the organization's exempt purpose in Part XIII. During the year, did the organization solicit or receive donations of art, historical treasures, or other similar assets to be sold to raise funds rather than to be maintained as part of the organization's collection? •••••••••••• Complete if the organization answered "Yes" on Form 990, Part IV, line 9, or reported an amount on Form 990, Part X, line 21. Is the organization an agent, trustee, custodian or other intermediary for contributions or other assets not included on Form 990, Part X? If "Yes," explain the arrangement in Part XIII and complete the following table: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Amount Beginning balance Additions during the year Distributions during the year Ending balance ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Did the organization include an amount on Form 990, Part X, line 21, for escrow or custodial account liability? If "Yes," explain the arrangement in Part XIII. Check here if the explanation has been provided on Part XIII ~~~~~ ••••••••••••• Complete if the organization answered "Yes" on Form 990, Part IV, line 10. Current year Prior year Beginning of year balance Contributions Net investment earnings, gains, and losses Grants or scholarships ~~~~~~~ ~~~~~~~~~~~~~~ ~~~~~~~~~ Other expenditures for facilities and programs Administrative expenses End of year balance ~~~~~~~~~~~~~ ~~~~~~~~ ~~~~~~~~~~ Provide the estimated percentage of the current year end balance (line 1g, column (a)) held as: Board designated or quasi-endowment Permanent endowment Temporarily restricted endowment The percentages on lines 2a, 2b, and 2c should equal 100%. |% |% |% Are there endowment funds not in the possession of the organization that are held and administered for the organization by: unrelated organizations related organizations ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ If "Yes" on line 3a(ii), are the related organizations listed as required on Schedule R? Describe in Part XIII the intended uses of the organization's endowment funds. ~~~~~~~~~~~~~~~~~~~~ Complete if the organization answered "Yes" on Form 990, Part IV, line 11a. See Form 990, Part X, line 10. Description of property Cost or other basis (investment) Cost or other basis (other) Accumulated depreciation Book value Land Buildings Leasehold improvements ~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~ Equipment Other ~~~~~~~~~~~~~~~~~ •••••••••••••••••••• Add lines 1a through 1e. |••••••••••••• 2 Part III Organizations Maintaining Collections of Art, Historical Treasures, or Other Similar Assets Part IV Escrow and Custodial Arrangements. Part V Endowment Funds. Part VI Land, Buildings, and Equipment. DESTINATION MEDICAL CENTER CORPORATION 46-4959371 0. 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 26 74 DRA F T (including name of security) 732053 10-09-17 Total. Total. (a) (b) (c) (1) (2) (3) (a) (b) (c) (1) (2) (3) (4) (5) (6) (7) (8) (9) (a) (b) (1) (2) (3) (4) (5) (6) (7) (8) (9) Total. (a) (b) 1. Total. 2. Schedule D (Form 990) 2017 (Column (b) must equal Form 990, Part X, col. (B) line 15.) (Column (b) must equal Form 990, Part X, col. (B) line 25.) Description of security or category (Col. (b) must equal Form 990, Part X, col. (B) line 12.) | (Col. (b) must equal Form 990, Part X, col. (B) line 13.) | Schedule D (Form 990) 2017 Page Complete if the organization answered "Yes" on Form 990, Part IV, line 11b. See Form 990, Part X, line 12. Book value Method of valuation: Cost or end-of-year market value Financial derivatives Closely-held equity interests Other ~~~~~~~~~~~~~~~ ~~~~~~~~~~~ (A) (B) (C) (D) (E) (F) (G) (H) Complete if the organization answered "Yes" on Form 990, Part IV, line 11c. See Form 990, Part X, line 13. Description of investment Book value Method of valuation: Cost or end-of-year market value Complete if the organization answered "Yes" on Form 990, Part IV, line 11d. See Form 990, Part X, line 15. Description Book value ••••••••••••••••••••••••••••| Complete if the organization answered "Yes" on Form 990, Part IV, line 11e or 11f. See Form 990, Part X, line 25. Description of liability Book value (1) (2) (3) (4) (5) (6) (7) (8) (9) Federal income taxes ••••• | Liability for uncertain tax positions. In Part XIII, provide the text of the footnote to the organization's financial statements that reports the organization's liability for uncertain tax positions under FIN 48 (ASC 740). Check here if the text of the footnote has been provided in Part XIII 3 Part VII Investments - Other Securities. Part VIII Investments - Program Related. Part IX Other Assets. Part X Other Liabilities. DESTINATION MEDICAL CENTER CORPORATION 46-4959371 ADVANCE TO DMC EDA 50,000. DUE FROM OTHER GOVERNMENTS 331,161. 381,161. DUE TO OTHER GOVERNMENTS 51,000. 51,000. 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 27 75 DRA F T 732054 10-09-17 1 2 3 4 5 1 a b c d e 2a 2b 2c 2d 2a 2d 2e 32e 1 a b c 4a 4b 4a 4b 3 4c. 4c 5 1 2 3 4 5 1 a b c d e 2a 2b 2c 2d 2a 2d 2e 1 2e 3 a b c 4a 4b 4a 4b 3 4c. 4c 5 Schedule D (Form 990) 2017 (This must equal Form 990, Part I, line 12.) (This must equal Form 990, Part I, line 18.) Schedule D (Form 990) 2017 Page Complete if the organization answered "Yes" on Form 990, Part IV, line 12a. Total revenue, gains, and other support per audited financial statements Amounts included on line 1 but not on Form 990, Part VIII, line 12: ~~~~~~~~~~~~~~~~~~~ Net unrealized gains (losses) on investments Donated services and use of facilities Recoveries of prior year grants Other (Describe in Part XIII.) ~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~ Add lines through ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Subtract line from line ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Amounts included on Form 990, Part VIII, line 12, but not on line 1: Investment expenses not included on Form 990, Part VIII, line 7b Other (Describe in Part XIII.) ~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~ Add lines and Total revenue. Add lines and ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ••••••••••••••••• Complete if the organization answered "Yes" on Form 990, Part IV, line 12a. Total expenses and losses per audited financial statements Amounts included on line 1 but not on Form 990, Part IX, line 25: ~~~~~~~~~~~~~~~~~~~~~~~~~~ Donated services and use of facilities Prior year adjustments Other losses Other (Describe in Part XIII.) ~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~ Add lines through Subtract line from line ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Amounts included on Form 990, Part IX, line 25, but not on line 1: Investment expenses not included on Form 990, Part VIII, line 7b Other (Describe in Part XIII.) ~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~ Add lines and Total expenses. Add lines and ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ •••••••••••••••• Provide the descriptions required for Part II, lines 3, 5, and 9; Part III, lines 1a and 4; Part IV, lines 1b and 2b; Part V, line 4; Part X, line 2; Part XI, lines 2d and 4b; and Part XII, lines 2d and 4b. Also complete this part to provide any additional information. 4 Part XI Reconciliation of Revenue per Audited Financial Statements With Revenue per Return. Part XII Reconciliation of Expenses per Audited Financial Statements With Expenses per Return. Part XIII Supplemental Information. DESTINATION MEDICAL CENTER CORPORATION 46-4959371 2,471,270. 0. 2,471,270. 0. 2,471,270. 2,471,270. 0. 2,471,270. 0. 2,471,270. 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 28 76 DRA F T OMB No. 1545-0047 Department of the Treasury Internal Revenue Service 732211 09-07-17 Complete to provide information for responses to specific questions onForm 990 or 990-EZ or to provide any additional information.| Attach to Form 990 or 990-EZ.| Go to www.irs.gov/Form990 for the latest information. (Form 990 or 990-EZ) Open to PublicInspection Employer identification number For Paperwork Reduction Act Notice, see the Instructions for Form 990 or 990-EZ.Schedule O (Form 990 or 990-EZ) (2017) Name of the organization LHA SCHEDULE O Supplemental Information to Form 990 or 990-EZ 2017 DESTINATION MEDICAL CENTER CORPORATION 46-4959371 FORM 990, PART I, LINE 1, DESCRIPTION OF ORGANIZATION MISSION: MINNESOTA. FORM 990, PART III, LINE 1, DESCRIPTION OF ORGANIZATION MISSION: AND SUPPORTING THE ECONOMIC GROWTH OF MINNESOTA AND ITS BIOSCIENCES SECTOR. FORM 990, PART VI, SECTION A, LINE 7A: THE GOVERNING DOCUMENTS PROVIDE THAT THE FILING ORGANIZATION'S BOARD OF DIRECTORS ARE APPOINTED AS FOLLOWS: " THE MAYOR OF ROCHESTER, MN (OR DESIGNEE) SUBJECT TO APPROVAL BY THE CITY COUNCIL. " THE CITY COUNCIL PRESIDENT, (OR DESIGNEE) SUBJECT TO APPROVAL BY THE CITY COUNCIL. " THE CHAIR OR ANOTHER MEMBER OF THE COUNTY BOARD OF OLMSTED COUNTY, APPOINTED BY THE COUNTY BOARD. " A REPRESENTATIVE OF MAYO CLINIC APPOINTED BY MAYO CLINIC " FOUR DIRECTORS APPOINTED BY THE GOVERNOR OF MINNESOTA, SUBJECT TO CONFIRMATION BY THE MINNESOTA SENATE. FORM 990, PART VI, SECTION A, LINE 7B: THE GOVERNING DOCUMENTS PROVIDE THAT THE FILING ORGANIZATION CAN AMEND THE ARTICLES OF INCORPORATION SUBJECT TO APPROVAL BY THE CITY OF ROCHESTER, MINNESOTA. THE CITY OF ROCHESTER, MINNESOTA ALSO HAS RIGHTS AND POWERS OF APPROVAL RELATED TO THE FILING ORGANIZATION'S ANNUAL BUDGET/FUNDING REQUEST AND INCURRENCE OF LONG-TERM DEBT. 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 29 77 DRA F T 732212 09-07-17 2 Employer identification number Schedule O (Form 990 or 990-EZ) (2017) Schedule O (Form 990 or 990-EZ) (2017)Page Name of the organization DESTINATION MEDICAL CENTER CORPORATION 46-4959371 FORM 990, PART VI, SECTION B, LINE 11B: THE 990 WILL BE PRESENTED AT A BOARD MEETING PRIOR TO FILING. FORM 990, PART VI, SECTION B, LINE 12C: THE DMCC MUST FOLLOW THE CONFLICT OF INTEREST REQUIREMENTS OF MINNESOTA STATUTES, SECTION 469.41, SUBD. 9. IN ADDITION, THE DMCC DIRECTORS ARE PUBLIC OFFICIALS UNDER MINNESOTA STATUTES SECTION 10A.01, SUBD. 35. SEE MINN. STAT. SECTION 469.41, SUBD. 10. PUBLIC OFFICIALS ARE SUBJECT TO STATUTORY CONFLICT OF INTEREST REQUIREMENTS. MINN. STAT. SECTION 10A.07. FORM 990, PART VI, SECTION B, LINE 15: DESTINATION MEDICAL CENTER CORPORATION DOES NOT HAVE ANY EMPLOYEES. FORM 990, PART VI, SECTION C, LINE 19: THE DESTINATION MEDICAL CENTER CORPORATION IS SUBJECT TO THE MINNESOTA GOVERNMENT DATA PRACTICES ACT AND OPEN MEETING LAW, AND THEREFORE MAKES ITS GOVERNING DOCUMENTS, CONFLICT OF INTEREST POLICY, AND FINANCIAL STATEMENTS AVAILABLE UPON REQUEST. FORM 990, PART XII, LINE 2C THE CORPORATION'S BOARD OF DIRECTORS ASSUMES RESPONSIBILITY FOR OVERSIGHT OF THE AUDIT OF ITS FINANCIAL STATEMENTS AND THE SELECTION OF ITS INDEPENDENT ACCOUNTANT. 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 30 78 DRA F T OMB No. 1545-0047 Department of the TreasuryInternal Revenue Service Section 512(b)(13) controlled entity? 732161 09-11-17 SCHEDULE R (Form 990)Complete if the organization answered "Yes" on Form 990, Part IV, line 33, 34, 35b, 36, or 37. Attach to Form 990. Open to PublicInspection| Go to www.irs.gov/Form990 for instructions and the latest information. Employer identification number Part I Identification of Disregarded Entities. (a)(b)(c)(d)(e)(f) Identification of Related Tax-Exempt Organizations. Part II (a)(b)(c)(d)(e)(f)(g) Yes No For Paperwork Reduction Act Notice, see the Instructions for Form 990.Schedule R (Form 990) 2017 | | Name of the organization Complete if the organization answered "Yes" on Form 990, Part IV, line 33. Name, address, and EIN (if applicable) of disregarded entity Primary activity Legal domicile (state or foreign country) Total income End-of-year assets Direct controlling entity Complete if the organization answered "Yes" on Form 990, Part IV, line 34, because it had one or more related tax-exemptorganizations during the tax year. Name, address, and EIN of related organization Primary activity Legal domicile (state or foreign country) Exempt Code section Public charity status (if section 501(c)(3)) Direct controlling entity LHA Related Organizations and Unrelated Partnerships 2017 DESTINATION MEDICAL CENTER CORPORATION 46-4959371 DESTINATION MEDICAL CENTER ECONOMIC DEVELOPMENT AGENCY - 46-4893585, 200 1ST PROVIDE SERVICES TO THE STREET SW, ROCHESTER, MN 55905 DMCC MINNESOTA 501(C)(3) LINE 12A, I N/A X 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 31 79 DRA F T Disproportionate allocations? Legal domicile (state or foreign country) General or managing partner? Section512(b)(13)controlledentity? Legal domicile (state or foreign country) 732162 09-11-17 2 Identification of Related Organizations Taxable as a Partnership. Part III (a)(b)(c)(d)(e)(f)(g)(h)(i) (j) (k) Yes No Yes No Identification of Related Organizations Taxable as a Corporation or Trust. Part IV (a)(b)(c)(d)(e)(f)(g)(h) (i) Yes No Schedule R (Form 990) 2017 Predominant income(related, unrelated,excluded from tax undersections 512-514) Schedule R (Form 990) 2017 Page Complete if the organization answered "Yes" on Form 990, Part IV, line 34, because it had one or more relatedorganizations treated as a partnership during the tax year. Name, address, and EINof related organization Primary activity Direct controllingentity Share of totalincome Share ofend-of-yearassets Code V-UBIamount in box20 of ScheduleK-1 (Form 1065) Percentageownership Complete if the organization answered "Yes" on Form 990, Part IV, line 34, because it had one or more relatedorganizations treated as a corporation or trust during the tax year. Name, address, and EINof related organization Primary activity Direct controllingentity Type of entity(C corp, S corp,or trust) Share of totalincome Share ofend-of-yearassets Percentageownership DESTINATION MEDICAL CENTER CORPORATION 46-4959371 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 32 80 DRA F T 732163 09-11-17 3 Part V Transactions With Related Organizations. Note:Yes No 1 a b c d e f g h i j k l m n o p q r s (i) (ii) (iii) (iv) 1a 1b 1c 1d 1e 1f 1g 1h 1i 1j 1k 1l 1m 1n 1o 1p 1q 1r 1s 2 (a)(b)(c)(d) (1) (2) (3) (4) (5) (6) Schedule R (Form 990) 2017 Schedule R (Form 990) 2017 Page Complete if the organization answered "Yes" on Form 990, Part IV, line 34, 35b, or 36. Complete line 1 if any entity is listed in Parts II, III, or IV of this schedule. During the tax year, did the organization engage in any of the following transactions with one or more related organizations listed in Parts II-IV? Receipt of interest, annuities, royalties, or rent from a controlled entity ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Gift, grant, or capital contribution to related organization(s) Gift, grant, or capital contribution from related organization(s) Loans or loan guarantees to or for related organization(s) Loans or loan guarantees by related organization(s) ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Dividends from related organization(s)~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Sale of assets to related organization(s) Purchase of assets from related organization(s) Exchange of assets with related organization(s) Lease of facilities, equipment, or other assets to related organization(s) ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Lease of facilities, equipment, or other assets from related organization(s) Performance of services or membership or fundraising solicitations for related organization(s) Performance of services or membership or fundraising solicitations by related organization(s) Sharing of facilities, equipment, mailing lists, or other assets with related organization(s) ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Sharing of paid employees with related organization(s) ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Reimbursement paid to related organization(s) for expenses Reimbursement paid by related organization(s) for expenses ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Other transfer of cash or property to related organization(s) Other transfer of cash or property from related organization(s) ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ •••••••••••••••••••••••••••••••••••••••••••••••••••••••• If the answer to any of the above is "Yes," see the instructions for information on who must complete this line, including covered relationships and transaction thresholds. Name of related organization Transaction type (a-s) Amount involved Method of determining amount involved DESTINATION MEDICAL CENTER CORPORATION 46-4959371 X X X X X X X X X X X X X X X X X X X 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 33 81 DRA F T Are allpartners sec.501(c)(3)orgs.? Dispropor-tionate allocations? General or managing partner? 732164 09-11-17 Yes No Yes No Yes N 4 Part VI Unrelated Organizations Taxable as a Partnership. (a)(b)(c)(d)(e)(f)(g)(h) (i) (j) (k) o Schedule R (Form 990) 2017 Predominant income(related, unrelated,excluded from tax undersections 512-514) Code V-UBIamount in box 20of Schedule K-1(Form 1065) Schedule R (Form 990) 2017 Page Complete if the organization answered "Yes" on Form 990, Part IV, line 37. Provide the following information for each entity taxed as a partnership through which the organization conducted more than five percent of its activities (measured by total assets or gross revenue) that was not a related organization. See instructions regarding exclusion for certain investment partnerships. Name, address, and EIN of entity Primary activity Legal domicile (state or foreign country) Share of total income Share of end-of-year assets Percentage ownership DESTINATION MEDICAL CENTER CORPORATION 46-4959371 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 34 82 DRA F T 732165 09-11-17 5 Schedule R (Form 990) 2017 Schedule R (Form 990) 2017 Page Provide additional information for responses to questions on Schedule R. See instructions. Part VII Supplemental Information. DESTINATION MEDICAL CENTER CORPORATION 46-4959371 13480831 132902 094-08292400 2017.04011 DESTINATION MEDICAL CENTER 094-94G1 35 83 84 B. DESTINATION MEDICAL CENTER CORPORATION RESOLUTION NO. ____-2018 Approving the 2018 State of Minnesota Charitable Organization Annual Report and 2017 Form 990 BACKGROUND RECITALS A. On behalf of the Destination Medical Center Corporation (“DMCC”), CliftonLarsonAllen (“CLA”) prepared the 2018 State of Minnesota Charitable Organization Annual Report (the “Annual Report”) and 2017 Form 990 (the “Form 990”) and is recommending that the DMCC approve both items. B. The Annual Report and Form 990 were presented to the DMCC on September 25, 2018, and are on file with the DMCC. RESOLUTION NOW, THEREFORE, BE IT RESOLVED, by the Destination Medical Center Corporation, that the 2018 State of Minnesota Charitable Organization Annual Report and 2017 Form 990 are approved. BE IT FURTHER RESOLVED, that the Board authorizes the Chair or Treasurer to take any action or make any amendments necessary and to file the Annual Report and Form 990. 1097483.DOCX 85 86 Status of Private Development Projects Receiving Prior Approval Titan Hilton Hotel- Titan (Approved as Broadway at Center Project) Berkman Apartments- Alatus (Approved as Alatus 2nd Street Development) Urban on First- Titan/Opus (Approved as Rochester 1st Avenue Mixed-Use Project) One Discovery Square- Mortenson (Approved as Discovery Square- Phase l) Bloom Waterfront- Bloom International Reality LLC (Approved as Bloom Waterfront) Wells Fargo Renovation- Ryan Companies US, Inc (Approved as 21 1st Street SW) Hotel Indigo Renovation- RHI Hotel JV, LLC (Approved as Holiday Inn Downtown Rochester) Hyatt House- First Civic Center, LLC (Approved as Hyatt House Civic + First Rochester) 87 88 Titan Hilton Hotel To: DMC Corporation Board of Directors From: DMC EDA Staff Date: September 17, 2018 Overview: After being one of the first two projects approved for DMC funding in spring 2015, the Titan Hilton hotel broke ground in December 2016. The 19-story structure will including retail and dining amenities and be anchored by a Hilton hotel. On January 31, 2018 a topping off ceremony took place with the community. Permanent interior enclosure and skin has been started. 180 on-site workers currently working on the project and that is anticipated to go up. The exterior enclosure was completed near the end of August. Next Steps: Anticipated completion date is January 31, 2019 with a hotel opening date of April 15, 2019. 89 Berkman Apartments To: DMC Corporation Board of Directors From: DMC EDA Staff Date: September 17, 2018 Overview: The Berkman Apartments include construction of an approximately 327,965 square foot, thirteen-level commercial and residential complex. In December 2016, the DMC EDA Board of Directors acted unanimously in recommending the proposed project to the DMCC as a Public Infrastructure Project, consistent with the DMC Development Plan. It further recommended support in the amount of $10.5 million in city Tax Increment Financing. Demolition of existing buildings on the site took place in December of 2017. Financing closed in early February 2018. A ground breaking ceremony took place on May 2, 2018. Currently 40-45 workers are on site daily. The most recent construction milestones include: • Utility connections complete – 2nd St SW, 14th Ave SW, and 15th Ave SW. • Deep foundations continue. Early in construction, we encountered some delays due to weaker than projected subsurface conditions. We have since taken a more pro-active approach to speed up the timeline. Target completion date of 1st week of August. • Elevator core – finished pouring the concrete pad as well as building it out. • Northland – on-site working on foundation walls and grade beams at the north and northwest corner of the site. Next Steps: Final completion of the entire building is early summer 2020 with anticipated lower levels available for leasing in Q1 of 2020. 90 Urban on First To: DMC Corporation Board of Directors From: DMC EDA Staff Date: September 17, 2018 Overview: The Urban on First Mixed-Use Development includes construction of an approximately 238,717 square foot, six-story podium commercial and residential complex. On January 12, 2017, the DMC EDA Board of Directors acted unanimously in recommending the proposed project to the DMCC as a Public Infrastructure Project, consistent with the DMC Development Plan. It further recommended support in the amount of $3.8 million in city Tax Increment Financing. At its January 2017 meeting, the DMCC approved the funding request upon the condition that proof of financing be provided to the DMCC board of directors. Titan/Opus closed on its financing in March 2018 and commenced construction immediately thereafter. The team is completing the environmental remediation and footing/foundations are underway with approximate 10-15 workers on site. Next Steps: Anticipated completion date is summer of 2019. 91 One Discovery Square To: DMC Corporation Board of Directors From: DMC EDA Staff Date: September 17, 2018 Overview: The Mortenson Phase I development is a 90,000 gross square foot building with lab and office space that will cater to the life science economy. Mortenson submitted a Joint Funding Application on May 15, 2017. The DMC EDA report and recommendation for Joint Funding was brought forward and approved by both the DMC EDA Board and the DMC Corporation Board in July, 2017. The project was approved at City Council on August 7, 2017. Mortenson and DMC hosted a ground breaking event and community celebration around Discovery Square on November 2, 2017. Construction is underway. A topping off ceremony was held June 28, 2018. Next Steps: Marketing and tenant recruitment continue. Anticipated construction completion date is March 28, 2019. 92 Bloom Waterfront To: DMC Corporation Board of Directors From: DMC EDA Staff Date: September 17, 2018 Overview: The Bloom Waterfront development is an approximately 650,000 square foot multi tower and mixed use development. The project includes senior living/memory care residential units, food and beverage, retail, parking, hotel, condominiums, a rehab clinic and public realm space. Bloom International Realty LLC submitted a Joint Funding Application in March of 2018. The DMC EDA report and recommendation for Joint Funding was brought forward and approved by both the DMC EDA Board and the DMC Corporation Board in June 2018. The project was approved at City Council on July 2, 2018 and a purchase agreement was approved by City Council on August 6, 2018. The Conditional Use Permit, which grants site plan approval, was approved by City Council on September 17, 2018. Next Steps: The Development Assistance Agreement is continuing to be negotiated with a target final agreement date of October, 2018. 93 Wells Fargo Renovation To: DMC Corporation Board of Directors From: DMC EDA Staff Date: September 17, 2018 Overview: Ryan Companies US, Inc. has proposed a renovation to the approximately 92,000 square foot, downtown Rochester Wells Fargo building located on Peace Plaza and First Avenue. This redevelopment is a catalyst for the public realm in Heart of the City and will achieve a sought after public connection of subway, street and skyway. The developer submitted a Joint Funding Application on May 1, 2018. The DMC EDA report and recommendation for Joint Funding was brought forward and approved by both the DMC EDA Board and the DMC Corporation Board in June 2018. The Wells Fargo Project was approved at City Council on July 16, 2018. Interior construction work has begun. Next Steps: City Council to approve development assistance agreement in October, 2018. Continued work on public realm integrated with Heart of the City design including improvements to be funded by TIF. 94 Hotel Indigo Renovation To: DMC Corporation Board of Directors From: DMC EDA Staff Date: September 17, 2018 Overview: The Hotel Indigo Development includes renovation to the existing 173 room Holiday Inn on the corner of Third Street and Broadway. The renovation includes a rebrand of the hotel, a new glass facade, improved restaurant, ballroom and other guest areas. In June 2018, the DMC EDA Board of Directors voted in favor of recommending the Hotel Indigo project to the DMCC as a Public Infrastructure Project, consistent with the DMC Development Plan. The DMC Corporation approved the project on June 28, 2018 and City Council approved on July 2, 2018. The Holiday Inn is no longer operating in preparation for construction. Next Steps: Construction is anticipated to begin in fall of 2018 and a completion date and opening of the new hotel in May of 2019. 95 Hyatt House To: DMC Corporation Board of Directors From: DMC EDA Staff Date: September 17, 2018 Overview: The Hyatt House development is a 175 extended stay hotel with parking which will change the gateway along Civic Center Drive in the Central Station subdistrict. First Civic Center, LLC submitted a Joint Funding Application in May of 2017. The DMC EDA report and recommendation for Joint Funding was brought forward and approved by both the DMC EDA Board and the DMC Corporation Board in July, 2017. The project was approved at City Council on July 2, 2018. The purchase of the property was completed summer, 2018. Financing is in process. Next Steps: Construction is anticipated to begin in late January, 2019. 96 Reconstruct 4th St SW from 1st Ave to 6th Ave SW and upgrade public utilities. Total Project: $12.25 million over 5 years (2018-- $2.25 million-- Source DMC) Purpose & Need: The Project includes reconstructing the street and replacing and up sizing the utilities. The 3rd Ave SW sanitary sewer is not adequate to handle future development and wet weather flows from 3rd St and 4th St SW. Status: Street design consistent with DMC Deign Guidelines and will accommodate future development of Discovery Square. Construction begins in 2018 with completion in 2019. 2018 Capital Improvement Program 97 Reconstruct 7th Avenue NW / SW from 2nd St SW to Cascade Creek and replace undersized sanitary and storm sewers. Total Project: $3 million over 2 years (2018-- $1.5 million-- Source DMC) Purpose & Need: A street reconstruction project to provide additional capacity for storm and sanitary sewer and by directing it away from the downtown area it has the benefit of creating additional capacity in the downtown/DMC area. Capture sanitary and storm water flows west of the Downtown Business area and direct the flows north. This frees up capacity in the existing downtown system and may eliminate other downtown capacity improvements. This allows for the growth in the Discovery Square and other DMC related development to occur. Status: This project has been postponed to 2019, hoping for a better bidding climate. May require DMC boundary modification. 2018 Capital Improvement Program 98 SS1 13th Ave Sanitary and Storm Sewer Capacity Improvements from 2nd St SW to 2nd St NW. Total Project: $6.1 million over 2 years (2019-- $3.35 million-- Sources $1.675 million City and $1.675 million DMC) Purpose & Need: Additional sewer capacity is needed for development along 2nd St SW, including the proposed growth of the Mayo / St Marys hospital complex. The storm sewer in 2nd Street SW does not have the capacity to meet future needs. The sanitary and storm water improvement have been included in the same street to limit disturbance to other neighborhood streets. The sewer and storm are being design to accommodate a future potential subway tunnel crossing on 2nd Street SW from St Marys to the retail businesses onthe north side of 2nd Street SW. Status: Redesign of the street is underway and encouraging the City to apply concepts from Saint Marys Place public realm design concepts. Construction to begin in 2019. 2018 Capital Improvement Program 99 Reconstruct North Broadway Avenue from Civic Ctr Dr to Zumbro River Bridge. Total Project: $17.1 million over 2 years (2018 -- $800k design-- Sources $400K City, $400K DMC) Purpose & Need: No. Broadway is the north gateway to Downtown Rochester. North Broadway was identified in the 2015 Broadway Corridor study as a corridor in need of reconstruction. Broadway Avenue, formerly Trunk Highway 63 was a turnback roadway from MnDOT. It is a priority Primary Transit Network corridor that is expected to experience the modal shift from single occupancy vehicles to transit such as Bus Rapid Transit. A reconstruction project is needed for the pavements and utilities. A reconstruction project can have a transformational effect on abutting properties in the corridor with enhanced landscaping and public realm improvements. Status: Street redesign has been the subject of a great deal of public discussion, focused primarily on potential bike ways, use of medians and turn lanes, and alignment of bus stops. City Council took action on final schematic decisions in June 2018. Construction to begin in 2019. 2018 Capital Improvement Program 100 DESTINATION MEDICAL CENTER ECONOMIC DEVELOPMENT AGENCY Six Critical Elements of Discovery Square Background Discovery Square is envisioned to be the economic engine of the DMC initiative, a 16-block Live-Work-Play sub- district with up to 2M new square feet of space where businesses of all sizes will develop products for the market. We assume there will be a density of healthcare-related businesses operating in Discovery Square, but we are not constraining this plan only to that sector of the economy. Described here is the framework of the overall strategy developed by the DMC EDA, anchored by six elements that are critical to the long-term success of the DMC Discovery Square sub-district. This strategy was informed by community input and benchmarking site visits. Many of these elements have activities already underway, led by early adopter advocates. 1. Space – A wide variety of office and laboratory space enables healthcare technology companies in all sectors to take their products and services to market and to clinical practices around the world. a. Traditional office space and specialized space for wet lab operations, including Good Manufacturing Practice infrastructure, clean rooms, and germ-free facilities. b. Computation infrastructure meets the needs of data-intensive healthcare business operations. c. Articulate space and infrastructure requirements based on market trends and local needs. d. Foundational Pieces i. Biobusiness Center and Collider Coworking e. Collaboration needs: work with developers to build the necessary space and infrastructure. 2. Businesses – The addition of large and small businesses across diverse sectors broadens the local economy, creates new job opportunities, and grows the local and state tax base. a. Startups that bring new energy, ideas and vision to the marketplace. b. Large businesses in key technology sectors bring expertise, reach, resources and unique skills to the local marketplace. c. International businesses new to the US market, bringing an international reach to local economy and increased diversity to the city. d. Relationships with international cluster organizations to share company footprints. e. Foundational Pieces i. 48+ startups from RAEDI, Mayo Clinic and others f. Collaboration needs: Work with partners at the regional, state, national and international level to advocate for the opportunity in Discovery Square. 3. Mayo Clinic - Access to Mayo Clinic resources and expertise is the primary value proposition of DMC Discovery Square a. Access to Mayo Clinic intellectual property clinical experts and key thought leaders to co- develop new technologies and to evaluate the company’s existing technologies. b. Access to education programs to cultivate their future workforce and to create new and innovative training programs. c. Access to core laboratory services for specimen processing and analysis, as well as engineering staff for routine equipment maintenance and repair. 101 DESTINATION MEDICAL CENTER ECONOMIC DEVELOPMENT AGENCY d. Collaboration needs: A strong working relationship with multiple divisions across Mayo Clinic is critical to success. 4. Attractive Ecosystem – A vibrant entrepreneurial ecosystem equips and encourages entrepreneurs from all parts of the community to go from idea to market and assures investors that their investments can grow and thrive in Discovery Square. a. Year-round activities in the public and private sectors are designed to educate, encourage and energize entrepreneurs on how to go from idea to business plan to execution. b. Accelerator programs in multiple sectors provide early mentoring, funding, and launch capabilities to new businesses. c. Formal and informal events of all sizes, covering all aspects of business building. d. Other businesses are available to support more specialized needs, such as legal, accounting, finance, marketing, and more. e. Foundational Pieces i. RAEDI, Collider, J2G, SMIF, Mayo Clinic Office for Entrepreneurship and SBDC activities f. Collaboration needs: Programming is curated by a diverse group of highly engaged stakeholders in the community. 5. Investment Capital – A variety of capital, grants, loans and incentives attracts businesses to move to (or stay in) Discovery Square and enables them to grow and thrive here. a. Funds are available for companies of all stages, including pre-seed, seed, angel, venture capital, corporate, philanthropic, SBIR/STTR, crowdfunding, and more. b. Funds are local, regional, and national in nature, such that investors are satisfied that their investment can be nurtured and grown in Discovery Square. c. Trusted advisors are available to help new businesses understand their options. d. Foundational Pieces i. RAEDI Econ Dev Fund, SE Mn Capital Fund, SMIF funds, Mayo Clinic funds e. Collaboration needs: Partnership at the local, regional and state level is necessary; this cannot be a Rochester-only effort. 6. Workforce – A diverse and educated workforce from all socioeconomic backgrounds that includes niche specialties is needed so businesses will move to (or stay in) Discovery Square. a. Undergrad, graduate students and post-docs in life sciences, devices, IT, engineering, artificial intelligence, bioinformatics, and more, are attracted to Rochester. b. Specialized expertise in FDA and European CE regulatory requirements regarding study design, biostatistics, bioinformatics, device validation, and more is available. c. Foundational Pieces i. Rochester Chamber, Mayo Clinic and J2G activities d. Collaboration needs: Relationships with higher education organizations, Rochester Chamber of Commerce and other organizations already working on this is critical to developing pipelines of talent and education programs that meet our needs. 102 DESTINATION MEDICAL CENTER ECONOMIC DEVELOPMENT AGENCY 2018 Discovery Square Entrepreneurship Ecosystem Gap Analysis Background: The DMC Discovery Square (DS) team has a strategy focused on six elements that are critical to the long- term success of the DS sub-district. One of those elements is a vibrant entrepreneurial ecosystem that equips and encourages entrepreneurs to go from idea to market. We have a high density of innovation and only a small (though growing) percentage that gets converted to a startup company. We need to equip the innovators with the tools and encouragement to turn those ideas into a business to ensure there is a steady pulse of new startups in the Discovery Square sub-district. After an initial kickoff in February 2018 with a team of eighteen local and regional stakeholders (details in Appendix 1), a self-selected subset of this group did an entrepreneurism gap analysis based on the Babson Entrepreneurship Ecosystem model (Appendix 2). It is important to note that the emphasis in the Babson model – and thus our team’s analysis - is on scalable, high-potential enterprises and not small-to-mid-sized enterprises. Also, although investment capital is part of the Babson model, our team did not address this topic in depth, as other groups are working on solutions there. Outcomes 1. Human Capital: A strong entrepreneurial community has a deep network of experienced entrepreneurs both internal and external to the community, a ready source of aspiring entrepreneurs, and a portfolio of curriculum to equip aspiring entrepreneurs. a. What we have: i. We have an international network of expertise in the form of alumni, expats and visitors, all of whom have the means and the connections to support our innovators and startups. b. What is missing: i. A cohesive effort to connect our innovators to our network of networks. ii. Entrepreneurship training is lacking at all age levels. iii. A good understanding of why more innovators don’t launch startups. iv. A deep bench of experienced C-suite level serial entrepreneurs who know how to take an idea to market and beyond. 2. Supporting organizations and infrastructure: The local community has business service providers available to help startups, such as legal, accounting, finance, web, IT, marketing, communications, sales, business consulting and business development. Specific to a healthcare technology hub, there is an additional need for product design, prototyping, evaluation/validation expertise, scaled up manufacturing and distribution. The community also has subsidized space available for startups. a. What we have i. Support businesses such as web, marketing, accounting, finance, IT and legal are present at a level appropriate to the current demand. ii. Manufacturing and distribution expertise and space is regionally available in other sectors which could translate to healthcare technologies. 103 DESTINATION MEDICAL CENTER ECONOMIC DEVELOPMENT AGENCY b. What is missing i. Affordable space for startup companies. ii. Product prototyping and development services, lean startup business consultation, product evaluation and validation environments, and business development expertise. 3. Products and Markets: The strong startup community has the resources and expertise to turn ideas into marketable products through a process of prototyping and productization. The local community encourages early adoption of local technology. a. What we have: i. We have an inventive and innovative community, as measured by the disclosed innovation at Mayo Clinic and issued patents in the region. b. What is missing: i. A broad set of expertise in converting ideas into functional prototypes and minimally viable products. ii. A cohesive coordinated attempt to highlight local technologies and champion the cause of adopting local technologies. 4. Culture: A community that supports entrepreneurism tolerates risk and failure, embraces innovation and prototyping as the norm, and elevates the social status of the entrepreneur so that it is top of mind for our community and business leaders. The community hosts workshops, conferences and business plan competitions and makes them highly visible. a. What we have: i. A small and under-resourced cadre of passionate supporters. ii. Business pitch competitions, such as Walleye Tank, the Assistive Tech Challenge, and the Minnesota Cup. b. What is missing: i. A coordinated effort via one organization that ‘owns’ the portfolio of programming dedicated to growing entrepreneurism. ii. Vocal support from community and business leaders that conveys a sense of importance and urgency and raises community awareness. 5. Policies: Effective policies reflect the needs and interests of both the governing body and the entrepreneurs. Too often policy development can happen in a vacuum, without adequate input from those who must comply with the policies. The Rochester food truck journey is a good example. a. What we have: i. A relatively blank policy slate with which to work. b. What is missing: i. No one organization has stepped up to represent the interests of entrepreneurs from a public policy perspective. 104 DESTINATION MEDICAL CENTER ECONOMIC DEVELOPMENT AGENCY Appendix 1 – February 2018 Retreat participants • Al Berning (Ambient Analytics) • Pam Bishop (Southern Mn Initiative Foundation) • Matt Bissonette (Rochester Chamber of Commerce) • Jenna Bowman (Rochester Downtown Alliance) • Stephen Ekker (Mayo Clinic Office for Entrepreneurship) • Xavier Frigola (RAEDI) • David Hewitt (Narrative Experiential DeSigns) • Frank Jaskulke (Medical Alley Association) • Jan Joannides (Renewing the Countryside) • Nick Moucha (Keller Williams Realty) • Dee Sabol (Diversity Council) • Chris Schad (DMC EDA) • Jamie Sundsbak (Collider CoWorking) • Bill Von Bank (DMC EDA) • Nathan Wiedenman (Community) Appendix 2 – Entrepreneurial Gap Analysis Team • Pam Bishop (Southern Mn Initiative Foundation) • Matt Bissonette (Rochester Chamber of Commerce) • Christine Bright (Community) • Xavier Frigola (RAEDI) • Amanda Leightner (Rochester Rising) • Mark Manske (Community) • Craig Oslund (Small Business Development Center) • Chris Schad (DMC EDA) • Jamie Sundsbak (Collider CoWorking) • Nathan Wiedenman (Mayo Clinic) 105 106 Chateau Theatre Interim Use & Investment To: To: DMC Corporation Board of Directors From: DMC EDA Staff Date: September 17, 2018 Background: 2015: 1. DMCC approved acquisition of Chateau Theatre as “public infrastructure project.” 2. City Council authorizes purchase of Chateau Theatre 3. Mayor forms Chateau Theatre Reuse Committee 2016: 1. City finalizes purchase 2. Task Force organizes its work around three milestone recommendations -Reuse -Design -Management and Governance 3. Consultant team of Miller Dunwiddie and Webb Management retained 4. Task Force conclusions: -Reuse as a multipurpose performing arts center -Redesigned within current footprint of the building and under the alleyway -$23+ million cost estimate -Management and programming by City Music Department, with ongoing operation loss 5. City Council received report and asked for the following: -Further discussion with adjacent property owners to explore opportunities -Consideration of alternative sources of funding, inclusive and in addition to DMC funds -Further study of the business plan, avoiding ongoing operating loss 2017: 1. City staff modified proposed operating income and expense model, still resulting in on-going operating loss 2. Ryan Companies agreed to consider incorporating Chateau facilities in the redeveloped Wells Fargo building, pending overall project plans 3. Task Force recommends inclusion of the Chateau costs in the future CIP budget, for presentation to DMCC 4. DMCC Report and Recommendation, November 2017 -Advance Chateau Theatre as a multiuse performing arts center, but consider a less capital intensive restoration model -Develop a strategy to diversify capital funding sources -Ensure a sustainable ongoing management, programming, and operations plan -Build relationships to adjacent development 107 -Consider ideas for interim use and activation -Preliminary CIP authorization 5. Discussion at DMCC meeting and subsequent discussion with Acting DMCC Chair: -Would like to see an alternative to the plan currently on the table -Specifically, less capital intensive and alternative management/programming model 2018: Current Status: • In March 2018, DMCC authorized use of CIP funds for design costs and capital improvements to Chateau Theatre to a) secure and protect the building; b) bring it up to code so that it can be used for “assembly” purposes; and c) design eventual integration with Peace Plaza and Wells Fargo building. • City of Rochester retained Miller Dunwiddie to develop construction and bid documents. • The three construction bids that were received were all over the estimated amount and City staff recommended the denial of the bids and an alternative approach to rebid. On August 20, 2018 City Council voted to reject the bids. Next Steps: • Update to new bid process- The roofing portion of the project will be put out to bid in fall of 2018. The interior work will be available to bid in either fall of 2018 or early spring of 2019. • Continue active engagement with Ryan for integration of Chateau with Wells Fargo redevelopment (inclusive of major building tenants). • Develop interim use programming and management model. • Develop RFP with the City of Rochester for program and operations management. 108 Heart of the City Public Realm To: DMC Corporation Board of Directors From: DMC EDA Staff Date: September 17, 2018 Overview: The RSP-led design team has completed the Schematic Design for Heart of the City in 2017. It was received by the Community Advisory Group, DMC EDA, DMCC, and City Council. Subsequent discussion has focused on • Questions about project phasing, financing, on-going management and operations • Integration of project design with Chateau Theatre, Wells Fargo, and Titan/Harbor Bay • Determine project priorities/phasing, and construction timetable • Identify and secure funding streams and financing strategy • Develop governance, management, and operations program Based on the opportunity associated with the redevelopment of the Wells Fargo building, recommendations to advance the detailed design for the two portions of the Heart of the City public realm: 1st Ave and the east end of Peace Plaza were made at the March, 2018 DMCC board meeting. To proceed in a timely manner, DMCC authorized the use of CIP funds for this purpose. During the Schematic Design Reconciliation phase of Heart of the City Phase 1 Coen + Partners, DMC, and City of Rochester have made great progress in establishing design direction for 1st Ave, Theatre Square, the Wells Fargo Building, and artist integration into the whole of the project. Next Steps: Next steps in the Schematic Design Reconciliation phase for the month of September 2018: 1. Project Management Set Up 2. Revit Model Construction 3. Artist Engagement 4. Weekly coordination meetings with Ryan Companies 5. Prepare for the Sept. 24th Committee of the Whole presentation 6. Prepare for demonstration projects, to be implemented in October 2018 109 Discovery Walk To: DMC Corporation Board of Directors From: DMC EDA Staff Date: September 17, 2018 Overview: The RSP-led design team has been retained to design Discovery Walk, which is the public realm along the 2nd Avenue corridor from 2nd Street south to 6th Street (Soldiers Field). Schematic design phase is complete, presentations to City, Mayo, Community, DMC EDA, DMCC, and City Council completed and the final report has been received. Next Steps: - Develop interim activation strategies to test design concepts in 2019 - Determine Impact on CIP in 2020 and beyond - Determine economic development potential for this corridor 110 Saint Marys Place To: DMC Corporation Board of Directors From: DMC EDA Staff Date: September 17, 2018 Overview: The public design process for Saint Marys Place sub-district public realm began in 2016 and resulted in a design concept that was presented in City Council on October 2nd, 2017. The concept is organized in four distinct elements: Protected Passages (subway and arcades) Active and Connected Places (Plazas, Alleys, Crosswalks) Streets for People (Protected bikeways, shared streets) District Identity (Public Art and District Branding) Following the public presentations revisions to the document were suggested to clarify expectations. Revisions include modifying some of the narrative, introducing Performance Objectives, and using images which better illustration design considerations. Document has been revised to address these concerns and was reviewed by City administration. Next Steps: Application of these design concepts with upcoming projects such as 2nd Street reconstruction and private development; Prototyping/temporary demonstrations of project idea in 2019 111 112 DMC Transportation Plan To: DMC Corporation Board of Directors From: DMC EDA staff Date: September 17, 2018 Overview: Minnesota Statute 469.40 provided for the establishment of a Destination Medical Center Development District (“District”) for the purpose of facilitating development of public infrastructure projects that support the state and local objective of creating a destination medical center. The statute establishing the Destination Medical Center provided for the preparation and adoption of a Development Plan that would be used to guide public investment in infrastructure in the District. The Destination Medical Center Corporation adopted a DMC Development Plan (“Plan”) as required by MN Statute 469.43 on April 23, 2015 and the City of Rochester Common Council adopted the Plan on March 23, 2015. The transportation vision in the Plan was developed with a focus on access and mobility that would reduce dependency on private vehicle travel in the district while creating improved multi-modal travel connections. The DMC vision provides for enhanced transit services connecting the District to the community and the region, a frequent downtown transit circulator, an enhanced network of bike facilities providing connections to District destinations and across the District, safe walkable streets, and a parking strategy that emphasizes convenience for high turnover customer and patron needs while emphasizing peripheral and remote parking for long term, low turnover parking use with seamless, convenient connectivity to downtown. The action by the Rochester Common Council in City Resolution #035-11 adopting the DMC Plan recognized the need to complete further study and refinement of transportation strategies including capital investment needs and services in the Plan in order to refine and update the planning level vision completed as part of the Plan in order to provide in-depth assessment of options and fully evaluate the details of the transportation solutions proposed in the Plan to insure projects best serve the needs of the City and the District and are the most cost effective solutions. In furtherance of the goals of the DMC Development Plan, the Rochester Common Council authorized funding for the Destination Medical Center Integrated Transit Studies (“Transit Studies”) for the purpose of providing a rigorous assessment of alternatives for vehicular, transit, pedestrian, and bicycle travel at a level of detail needed to generate confidence in the study’s findings, conclusions, and recommendations and support the economic development, sustainability and community livability goals of the DMC Development Plan. The Transit Studies have led to the preparation of the ITS Final Report and supporting study documentation for the four integrated studies that led to development of the ITS Final Report, including the Downtown Transit Circulator Study, the Street Use and Operations Study, the Parking and Travel Demand Management Study and the City Loop Study. The ITS Final Report provides a framework refining the transportation solutions and strategies needed to support the economic development efforts of a Destination Medical Center. The ITS Final Report provides the basis for development of a DMC Transportation Strategy and Implementation Plan which will serve as the blueprint for developing 113 future Public Infrastructure Projects in the District that will support the DMC economic development program and sustainability and livability goals of the Plan. In June and July, 2018, DMCC and City Council, respectively, accepted the Final Report, dated June 2018, as an updated and refined framework for the development and implementation of the transportation access and mobility vision defined in the DMC Development Plan. In accepting the ITS Final Report the DMCC and City Council supported the conclusions and recommendations of the study, subject to following points of clarification: a) Specific locations for public infrastructure investment in areas designated as Mobility Hub A and Mobility Hub B and the associated circulator connecting routes in the ITS Final Report are subject to further review and refinement providing additional examination of joint public – private development opportunities that can contribute to achieving the land use and redevelopment goals of city and DMC plans, provide safe and reliable transportation system and network access, take advantage of joint financing approaches while meeting market driven business needs in a manner that is compatible with economic development, that will set forward a strategy and implementation framework for the mobility hubs. b) Specific route of the BRT circulator will be further studied to best reflect location of the Mobility Hubs, opportunities for economic development, operational efficiencies, and other considerations. c) Representations in the ITS Final Report of specific phasing of ITS recommendations are illustrative and are subject to change upon the development, refinement, review, and adoption of an ITS Implementation Plan and Schedule. The adopted Implementation Plan will include a plan for monitoring activity in the DMC District against established benchmarks that will serve as indicators for triggering action on critical elements of the ITS Studies recommendations. d) Representations of specific right-of-way impacts on private property are illustrative and are subject to change based upon the development, refinement and review of geometric layouts or adoption of Official Street Map(s) identified in the ITS Implementation Plan and Schedule. e) Repurposing of general purpose vehicle travel lanes for alternative use will be based on further analysis of the ability of the impacted street corridor to meet the demand for person movement within limited space constraints through a combination of multi-modal strategies that provide adequate capacity to meet projected travel demand while maintaining adequate vehicle operations. f) Replacement of lost parking spaces for customers, visitors, patients or resident will be served within the district through a combination of development of new public and private parking resources, expanded shared use of existing parking resources, repurposing of existing commuter parking or pricing strategies that better match parking demand with parking supply. 114 Next Steps: • Finalize Implementation Matrix and Phasing Plan • Address and resolve each of the “exceptions” from the final ITS report • Focus on critical first steps in long-term catalytic transportation change -Start shifting transportation modes -Start Federal Transportation Administration (FTA) process for circulator -Start shifting long-term parking outside of downtown -Start building active transportation network -Study potential Highway 52 decking concept • Approve Near Term Projects in 2019 CIP -Acquisition of Electric Buses -Initial phase of City Loop -Launch of TMA (Arrive Rochester) -Land acquisition for circulator and park and ride system -Study of the H52 decking concept 115 116 Destination Medical Center Economic Development Agency 2018 Workplan Updated: September 17, 2018 117 Executive Summary In 2018, the Destination Medical Center (“DMC”) initiative will focus on continuing robust economic development, further developing the DMC District and the continued implementation of programs and initiatives to transform America’s City for Health. Anchored by the DMC Development Plan and influenced by the engagement and participation of our stakeholders, the Destination Medical Center Economic Development Agency (“DMC EDA”) will continue to pursue the Phase 1 and 20-year goals of the DMC initiative. Twenty year goals include: o Create a comprehensive strategic plan o Leverage the public investment of $585 million o Create approximately 35,000 new jobs o Generate approximately $7.5 - $8.0 billion in new net tax revenue o Achieve the highest quality patient, companion, visitor, employee, and resident experience New strategic objectives for 2018 include: o Environment and sustainability o Community engagement outreach o Patient, visitor and community experience 118 DMC EDA Statutory Role and Responsibilities The DMC EDA assists the Destination Medical Center Corporation (“DMCC”) and the City of Rochester (“City”) in implementing the development planning and promotion, development services, and marketing, outreach and communication activities required to achieve the goals of the DMC development plan. The DMC legislation identified several key responsibilities of the DMC EDA in addition to its role as an advisory agency to the DMCC and City. The 2018 DMC EDA workplan references these responsibilities, which have been organized as follows: (A) development planning and promotion, (B) development services, and (C) marketing, outreach and communications. The specific statutory responsibilities are listed below: A. Development Planning and Promotion, including: o Drafting and implementing the development plan, including soliciting and evaluating proposals for development and evaluating and making recommendations to the DMCC and the City regarding those proposals o Seeking financial support for the DMCC, the City, and projects o Partnering with other development agencies and organizations, the city, and the county in joint efforts to promote economic development and establish a destination medical center o Supporting and administering the planning and development activities required to implement the development plan B. Development Services, including: o Developing and updating the criteria for evaluating and underwriting development proposals o Providing transactional services in connection with approved projects o Working with the corporation to acquire and facilitate the sale, lease, or other transactions involving land and real property o Assisting the DMCC or City and others in applications for federal grants, tax credits, and other sources of funding to aid both private and public development C. Marketing, Outreach, and Communications, including: o Facilitating private investment through development of a comprehensive marketing program to global interests o Developing patient, visitor, and community outreach programs o Preparing and supporting the marketing and promotion of DMC o Preparing and implementing a program for community and public relations All objectives contained within this workplan reference one or more of these statutory responsibilities, demonstrating the commitment of the DMC Corporation, City of Rochester, and DMC EDA to the DMC Development Plan and to the intent of the State Legislature and Governor indicated by the support, passage, and approval of the DMC legislation. 119 Create a comprehensive Strategic plan with a compelling vision that harnesses the energy and creativity of the entire community Leverage the public investment to attract more than $5 Billion in private investment to Rochester and the region Create approximately 35,000 new jobs with workforce development strategies that support growth Generate approximately $7.5-8 Billion in new tax revenue over the next 35 years Achieve the highest quality of patient, companion, visitor, employee, and resident experience, now and in the future DMC Goals Transportation DMC Strategic Priorities Discovery Square Heart of the City Economic Development With Mayo Clinic at its heart, the Destination Medical Center (DMC) initiative is the catalyst to position Rochester, Minnesota as the world’s premier destination for health and wellness; attracting people, investment opportunities, and jobs to America’s City for Health and supporting the economic growth of Minnesota, its bioscience sector, and beyond. DMC Mission 120 DMC Strategic Priority: Economic Development Strategic Objective A: Ensure current and accurate market demand data for key markets in order to prioritize DMC investment *Statutory Responsibilities: A. Development Planning and Promotion & B. Development Services Action Step When Status DMC EDA Role 1. Review and update residential market demand study, to include identifying affordable housing opportunities Q3-Q4 Lead 2. Review and update hotel market demand study Q1-Q2 Updated to Q3 Lead 3. Finalize Retail market demand study initiated in 2017 Q1 Updated to Q3 Lead 4. Review and update commercial office space market demand study Q1-Q2 Updated to Q3 Lead 5. Review and update BioScience market demand study Q1-Q2 Updated to Q3 Lead Strategic Objective B: Driven by market data, prioritize relationships with at least 10 high potential real estate developers to facilitate future development projects *Statutory Responsibilities: A. Development Planning and Promotion & B. Development Services Action Step When Status DMC EDA Role 1. Quarterly meetings with all developers (outside of project review process) Q1-Q4 Lead 2. Formal process debrief and critical review for each development project Q1-Q4 Lead 3. Update developer toolkit Q1-Q2 Updated to Q3 Lead 4. Host Minnesota Real Estate Journal Summit Q2 Updated to Q4 Participate Strategic Objective C: Driven by market data, prioritize and develop relationships with 10 high potential equity and finance partners to facilitate future investment projects *Statutory Responsibilities: A. Development Planning and Promotion, B. Development Services & C. Marketing, Outreach, and Communications 121 Action Step When Status DMC EDA Role 1. Identify high potential equity and lending partners Q1 Lead 2. Host meetings with each to introduce them to DMC opportunities and Rochester market Q2-Q4 Lead 3. Participate in 2-4 key national forums Q1-Q4 Lead Strategic Objective D: Identify, refine, and diversify public and private financial investment tools, to maximize available DMC resources *Statutory Responsibilities: A. Development Planning and Promotion & B. Development Services Action Step When Status DMC EDA Role 1. Assist DMC Corporation in setting priorities for DMC investment Q1 Updated to Q4 Lead 2. Identify and implement Tax Credit programs (New Markets, Historic, Low Income) Q1-Q4 Participate 3. Pursue public and private grant programs Q1-Q4 Lead Strategic Objective E: Provide leadership and convene community stakeholders to drive environmental outcomes outlined in the DMC plan for the DMC District *Statutory Responsibilities: A. Development Planning and Promotion Action Step When Status DMC EDA Role 1. Evaluate the feasibility of creating a district energy system to support the growth associated with the DMC plan Q1 - Q2 Lead 2. Evaluate new opportunities for new construction and existing building utility incentives Q1 - Q4 Participate 3. Recruit local businesses to participate in a voluntary commercial energy benchmarking program Q2-Q4 Lead Strategic Objective F: To meet the DMC environmental goals associated with new development, generate a Sustainable Building Policy for DMC-funded projects *Statutory Responsibilities: A. Development Planning and Promotion & B. Development Services Action Step When Status DMC EDA Role 1. Pilot sustainable building policy with two DMC funded development projects Q1-Q4 Lead 2. Measure, verify and correct plan as needed to move from pilot to policy Q3-Q4 Lead 122 3. Develop an engagement and communications strategy locally, regionally and nationally Q3-Q4 Lead Strategic Objective G: Build a community culture around sustainability through education and awareness to meet the environmental outcomes for the DMC District *Statutory Responsibilities: C. Marketing, Outreach, and Communications Action Step When Status DMC EDA Role 1. Develop community-wide sustainability speaker series Q1-Q4 Lead 2. Form a sustainability committee focused on transportation and waste Q3-Q4 Lead 3. Develop, track and communicate DMC-wide environmental outcomes Q1-Q4 Lead 4. Participate in “LEED for Communities” pilot Q1-Q4 Lead 5. Create two prototype or public-facing events to support the DMC’s sustainability initiatives Q1-Q4 Lead Strategic Objective H: Establish a community engagement strategy that builds a community of stakeholders that trust the DMC vision and the leaders associated with it – ultimately supporting a successful implementation of the DMC development plan *Statutory Responsibilities: A. Development Planning and Promotion & C. Marketing, Outreach, and Communications Action Step When Status DMC EDA Role 1. Develop and implement community engagement strategies to support DMC subdistricts’ planning Q1-Q4 Lead 2. Implement local community engagement and awareness strategy that supports the DMC work plan Q1-Q4 Lead 3. Continue state and regional engagement strategy Q1-Q4 Lead Strategic Objective I: Implement DMC patient, visitor and community experience strategy that identifies the needs of a community while becoming the catalyst for change and fueling private sector investment and growth *Statutory Responsibilities: A. Development Planning and Promotion & C. Marketing, Outreach, and Communications Action Step When Status DMC EDA Role 1. Finalize patient, visitor, and community experience strategy Q1 Lead 2. Develop experience project and implementation plan Q2-Q4 Lead 123 3. Align work with Heart of the City, Discovery Square and other DMC subdistricts Q1-Q4 Lead Strategic Objective J: Execute the state, national and international marketing and communications strategy to attract identified target audiences (global and national investors and developers, life- science small and medium businesses and future workforce) to Rochester *Statutory Responsibilities: C. Marketing, Outreach, and Communications Action Step When Status DMC EDA Role 1. Develop and implement 2018 marketing and advertising plan Q1-Q4 Lead 2. Advance the communications plan focusing on local, regional and national audiences Q1-Q4 Lead 3. Update existing websites to align with updated marketing and communications plan (Focusing on Discovery Square and investor/developer pages) Q1-Q4 Lead 4. Align communications and community engagement strategies to advance the DMC development plan Q1-Q4 Lead 124 DMC Strategic Priority: Heart of the City Strategic Objective A: Advance Heart of the City public realm project in order to complete the design development phase *Statutory Responsibilities: A. Development Planning and Promotion, B. Development Services & C. Marketing, Outreach, and Communications Action Step When Status DMC EDA Role 1. Establish leadership and advocacy team Q1-Q3 Lead 2. Develop sustainable financing strategy Q1-Q2 Update to Q4 Lead 3. Build community ownership strategy Q1-Q4 Lead 4. Manage design development tasks Q1 Participate Strategic Objective B: Create management and finance plan in order to advance Chateau Theatre redevelopment *Statutory Responsibilities: A. Development Planning and Promotion, B. Development Services & C. Marketing, Outreach, and Communications Action Step When Status DMC EDA Role 1. Conduct fundraising feasibility study Q1-Q2 Participate 2. Assist City of Rochester with fundraising campaign and the development of a sustainable funding model Q3-Q4 Start in Q3 Participate 3. Build community ownership strategy Q1 Participate Strategic Objective C: Advance at least one strategic private sector development project to move Heart of the City vision forward *Statutory Responsibilities: A. Development Planning and Promotion & B. Development Services Action Step When Status DMC EDA Role 1. Identify priority development Q1-Q2 Lead 2. Agreement on program and design Q2-Q3 Lead 3. Agreement on financial model Q2-Q4 Lead 125 DMC Strategic Priority: Discovery Square Strategic Objective A: Attract new businesses to realize the vision of Discovery Square and diversify the economy *Statutory Responsibilities: A. Development Planning and Promotion, B. Development Services & C. Marketing, Outreach, and Communications Action Step When Status DMC EDA Role 1. Recruit new companies to Discovery Square subdistrict Q1-Q4 Participate 2. Complete and implementation branding for Discovery Square subdistrict Q1-Q2 Lead 3. Activate Connolly building on the corner of 3rd St. and 4th Ave. on the Mayo Clinic campus for new Discovery Square businesses Q1-Q2 Lead 4. Execute Discovery Square marketing strategy at state, national and international level Q1-Q4 Lead 5. Partner with Mayo Clinic and developer to initiate Phase 2 building discussions Q3-Q4 Participate 6. Develop and execute international business development strategy Q1-Q4 Lead 7. Partner with Mayo Clinic to define “access” to Mayo programming and services for Discovery Square businesses Q1-Q2 Lead Strategic Objective B: Develop public space design strategy to enhance the live, work, play environment of Discovery Square *Statutory Responsibilities: A. Development Planning and Promotion & C. Marketing, Outreach, and Communications Action Step When Status DMC EDA Role 1. Identify and coordinate design team to develop Discovery Walk public space design plan Q1-Q4 Lead 2. Develop and implement interim use plan for a site within the Discovery Square subdistrict Q1-Q3 Won’t pursue, site now for sale and not available Lead Strategic Objective C: Establish business eco-system to grow and attract new businesses *Statutory Responsibilities: A. Development Planning and Promotion & B. Development Services Action Step When Status DMC EDA Role 1. Develop plan for startup wet lab space Q1-Q2 Participate 2. Develop and execute Discovery Square programming strategy to grow business community, equip and engage innovators and attract investors Q1-Q4 Participate 3. Explore pilot business development program to move undeveloped IP off the shelf and into the market Q2-Q3 Won’t pursue Lead 126 4. Lead appropriate work teams & advisory groups with stakeholders, experts, and users Q1-Q4 Lead 127 DMC Strategic Priority: Transportation Strategic Objective A: Set priorities for Transportation Plan implementation *Statutory Responsibilities: A. Development Planning and Promotion, B. Development Services & C. Marketing, Outreach, and Communications Action Step When Status DMC EDA Role 1. Work with the City and County to develop an agreed upon set of priorities for transportation initiatives, including alternative modes of transportation and solutions for the safe and effective transportation of mobility-limited and patient populations Q1-Q2 Participate 2. Work with the City to identify funding stream for agreed upon priority Q2-Q4 Participate 3. Develop 2-4 demonstration projects to test transportation solutions, Q1-Q4 Participate 4. Participate with appropriate work teams & advisory groups with stakeholders, experts, and users Q2-Q4 Participate Strategic Objective B: Advance Capital Improvement Program (CIP) *Statutory Responsibilities: A. Development Planning and Promotion Action Step When Status DMC EDA Role 1. Participate in DMC EDA/city administration meetings Q1-Q4 Participate 2. Collaborate with City to create CIP priority list Q3 Start in Q3 Participate 3. Consult with City to overcome obstacles to allow on time construction of CIP projects Q1-Q4 Participate * Lead- DMC/EDA will take the lead on the initiative and drive action. * Participate- DMC/EDA will share responsibility on the initiative. 128 DMC Market Studies To: DMC Corporation Board of Directors From: DMC EDA Staff Date: September 17, 2018 Overview: Part of the original DMC Plan included a market study to evaluate the needs of the DMC District. This study was completed by AECOM in 2015. Due to the growth projected for the DMC an updated market study was commissioned to measure the progress of the district against the original plan and projections. AECOM was selected through an RFP process to update the original document. At present they are analyzing the initial data and will be providing a high-level preliminary assessment of where the progress to date compares against the original plan. Next Steps: The AECOM Team will develop estimates for market opportunities in the DMC for the next five years for Hotels, Residential, Office/Med-Tech, and Retail development. Highlights, trends and key considerations will be presented at this year’s Rochester DMC Real Estate Summit on October 12, 2018. A final completed report will be made available in October to review. 129 Energy and Sustainability Update To: DMC Corporation Board of Directors From: DMC EDA Staff Date: September 17, 2018 Overview: Kevin Bright, DMC EDA’s Energy and Sustainability Director, started on March 6, 2017. His position is split between the DMC EDA and the City of Rochester where 80% of his time is with the EDA and the remaining 20% with the City. Over the past year and a half, he has continued to work with the City, community partners, environmental organizations and the Energy Integration Committee (EIC) on a variety of initiatives outlined below. Additionally, the energy and sustainability appendix to the DMC Jointing Application for Funding, which was referenced at the June 28, 2018 DMC Corporation board of directors meeting, immediately follows this memorandum. Progress To-Date: o Individual Development Projects In order to clearly outline the expected environmental and energy outcomes of DMC projects, last board meeting a Sustainable Building guidance was approved and integrated into the DMC Application. This change will ensure the environmental and energy outcomes expected for projects will be incorporated. A project has not yet come forward and used the new sustainable building guidance. o DMC District District Energy – A draft process document has been created for individual projects to inquire about connecting to a downtown district energy system. In the 4th quarter of 2018, the Energy Integration Committee is meeting to identify a path to meet the DMC’s ambitious sustainability and energy reduction goals. The goal of this work is to identify a group of projects to develop for input from the DMCC to create a path for the DMCC to meet its environmental goals. Voluntary Commercial Energy Benchmarking – The EIC is moving forward with the launch of a voluntary commercial energy benchmarking program with several partners in the City and County. The City and County have combined their benchmarking data and the landing page for the program is being established. This program would be open to buildings both inside and outside the DMC District. o Culture of Sustainability In collaboration with local environmental and government commissions, the DMC launched a Sustainability Series in late 2017 meant to convene interested parties to learn more about a variety of environmental topics over lunch, once a month. This Lunch and Learn concept is meant to accomplish a few items: (1) connect those in the community working on environmental topics; (2) share best practices across disciplines; (3) cultivate new working relationships and collaborations; and (4) grow environmental awareness throughout the community. Thus far, presentations have covered the DMC sustainability goals, net zero building design in Minnesota, Mayo’s methods to achieving their energy reduction goal and other topics. To date we have hosted 10 series over the past 10 months. 130 Destination Medical Center Economic Development Agency (DMC EDA) Sustainable Building Appendix The Destination Medical Center (DMC) Economic Development Agency will seek to meet its energy and sustainability performance goals through the implementation of these guidelines. This document provides a measureable, outcome- based approach to ensure that new construction and renovation projects in the Destination Medical Center (DMC) District are designed, constructed and operated with explicit performance metrics. If the project plans to apply for DMC funding assistance, the goals outlined in the document below must be integrated into the Project’s application. Design Path: Developers will use the design process outlined below and incorporate its findings into the project’s funding application. 1. Design Process a. In order to apply for DMC Funding, the Project Team (Owner, Design Team, Others) will engage in a whole-building energy performance evaluation process. This will serve to establish energy performance goals for the intended facility. As part of this process, the Team will define a measureable energy performance target for the project. To complete this task, all projects must participate in the Minnesota Sustainable Buildings 2030 energy targeting exercise. The predicted energy use of the building must meet or exceed those identified through the Minnesota Sustainable Building 2030 “Energy Standards.” The conditions for meeting the “Energy Standards” are subject to the “Cost Effectiveness” Protocol of SB 2030. All applications for DMC funding need to include the energy target for the project, as well as a commitment to measure and verify the building’s performance while in operation for its first three years. The design and construction team is responsible for setting up a measurement system that can verify the building is meeting its expected whole building energy performance target after construction. Utility information will be reported by the building owner or operator. b. Note: Predicted energy design strategies are subject to the Cost Effectiveness Protocol of SB 2030. c. During the first three years of operation, project performance will be verified with the use of ENERGY STAR Portfolio Manager to report and share the building’s energy performance on a monthly basis. During and after the three year period, the building owner will be responsible for reporting facility performance data to ENERGY STAR, where it will be made public. d. Note: Predicted energy design strategies are subject to the Cost Effectiveness Protocol of SB 2030. Other Design Requirements: The following requirements will be incorporated and documented as part of each project within the Developer’s chosen rating system. Projects must invite the DMC EDA to the project team as official members for the specific Developer-selected rating system for review. 1. Predicted use of potable water in the building must be at least 35% below the Energy Policy Act of 1992 2. Predicted water use for landscaping must be at least 50% less than a traditionally irrigated site using typical water consumption for underground irrigations systems standards. Projects should use EPA Watersense or comparable program for modeling. Only native or adapted species to Minnesota should be included in building plans. 3. Actual solid waste of construction materials, excluding regulated waste, must be at least 75% recycled or diverted from landfills or waste incineration facilities. 4. Site and landscape design shall enhance or develop the site’s green infrastructure. The design, construction and site restoration shall include elements that enhance the site and landscape for water conservation, 131 stormwater retention and filtration, habitat and biodiversity as well as ensuring pedestrian and bike safety. Improve storm water infiltration compared to previous site conditions. 5. As applicable to project scope, evaluate and assess the integration of a renewable energy system into the building that provides 2% or more of its annual energy consumption. If this is not financially feasible, provide a life-cycle analysis for the system that meets the “Cost Effectiveness” Protocol of SB 2030. If a renewable energy system is not possible, evaluate and prepare the building to be renewable ready both structurally and mechanically or electrically to ensure the ease of a renewable energy installation at a later date. Possibilities include but are not limited to solar photovoltaic, solar thermal, and wind. 6. As applicable to the project scope, provide electric vehicle (EV) parking infrastructure in order to provide charging access for building residents and occupants. For references suggesting an appropriate amount of vehicle charging stations, please refer to third party green building rating systems, like LEED. If the cost of EV charging stations are proven to be overly financially burdensome for a project, the facility should provide the infrastructure to allow chargers to be installed at a later date. 7. As design documents develop, please ensure the building design incorporates the goals and guidelines from the following documents as applicable: a. Destination Medical Center – District Design Guidelines b. Destination Medical Center – Development Plan Third Party Green Building Certification Requirements: The Developer must choose for the project one of the following rating systems and levels which to minimally comply: Commercial Projects: 1. LEED for Building Design and Construction (BD+C) Version 4 or other as appropriate 2. Living Building Challenge 3. Other rating systems as proposed by the Developer (such as State Guidelines Building Benchmarking and Beyond (B3) Compliant) will be considered Residential or Multi-Family Projects: 1. LEED for Homes, LEED Multi-Family or LEED BD+C Version 4 2. Minnesota Green Star Silver 3. Green Communities 2015 Reporting: 1. During the first three years of operation, project performance will be verified with the use of ENERGY STAR Portfolio Manager to report and share the building’s energy performance on a monthly basis. During and after the three year period, the building owner will be responsible for reporting facility performance data to ENERGY STAR, where it will be made public through the City of Rochester’s Voluntary Energy Benchmarking Program. a. Predicted Greenhouse Gas Emissions must be reported to the DMC EDA by the design team.1 These data will be included in the City of Rochester’s Voluntary Energy Benchmarking Program. 1 Using EPA and eGrid fuel and electricity emission factors, available at: https://www.epa.gov/sites/production/files/2015- 07/documents/emission-factors_2014.pdf 132 b. Annually, provide actual energy data to ENERGY STAR Portfolio Manager and DMC EDA by the building Owner, or by the building’s utility service provider with permission of the Owner. These data will be included in the City of Rochester’s Voluntary Energy Benchmarking Program. c. Annually, provide actual water data to ENERGY STAR Portfolio Manager and DMC EDA by the building Owner, or by the building’s utility service provider with permission of the Owner. These data will be included in the City of Rochester’s Voluntary Energy Benchmarking Program. 2. For buildings not achieving the contractual performance target during operation, an as-built energy model may be produced to demonstrate achievement. The as-built model must include all changes to the design that occur during construction (such as final glazing assembly NFRC rated thermal performance, wall insulation and thermal bridging, light fixtures, HVAC equipment or control systems). For an as-built model tenant fit-out spaces, multi-family dwelling units and hotel guest rooms may be modeled using assumptions for occupancy density, occupancy schedule, receptacle power and service water found in the following documents: ASHRAE 90.1-2013 User’s Manual Appendix G, 2015 ASHRAE Handbook – HVAC Applications, ASHRAE 62.1-2016, 2015 ENERGY STAR Multifamily High Rise Simulation Guidelines and Building America House Simulation Protocols2. 3. If the energy performance target is not achieved according to metered energy consumption and the design was not substantially changed, a report shall be provided to the building owner and to the DMC identifying reasons for non-achievement and recommendations for improving performance. Follow-up meetings may be scheduled as necessary to assist with developing next steps to improve the building’s energy performance. Incentive Opportunities: 1. Commercial and Multifamily Housing Projects a. Project teams, typically the mechanical and electrical design engineers, are expected to assist with the specification of lighting, mechanical and other applicable fixtures and equipment that are eligible for utility incentive programs. b. Incentives discussions shall occur during the goal setting and early discussions in the integrated planning and design process. c. During conceptual design, project teams should contact Rochester Public Utilities (RPU) and Minnesota Energy Resources Corporation (MERC) to learn about their incentive opportunities and which programs will be applicable to their project d. Projects must pursue all available incentives as applicable to the project 2. Federal or State Tax Incentives a. Projects must pursue any available energy efficiency-related federal or state tax incentives as applicable to the project. Examples include Federal Tax Incentive 179D. Each project’s compliance with the Green Building Policy must be verified, in accordance with the verification method specified by the Developer-selected rating system and the DMC EDA. Projects must invite the DMC EDA to the project team for the specific Developer-selected rating system for review. In the event of notification of non-compliance, and reasonable opportunity to cure, the DMC EDA will consider remedial action, and possibly limit the amount of funds to the project. The Policy will apply to projects for which schematic design is initiated after June 28, 2018. 2 Hendron, Robert and Cheryn Engebrecht. Building America House Simulation Protocols. National Renewable Energy Laboratory, October 2010. Found at: http://www.nrel.gov/docs/fy11osti/49246.pdf 133 Project Timeline DMC Funding Application Preparation •Review the energy targets and other sustainability goals included in the policy. Include plans, strategies and other design information as available in the DMC funding application. At the very least, confirm understanding of the policy and their integration into the design of the building. Schematic Design / Design Development/ Construction Documents •As the design progresses, update the energy and sustainability targets for the project as necessary. Communicate updates with the DMC EDA during SD, DD and CD milestones. •Ensure the project has integrated all energy and sustainability performance goals in the design, including, but not limited, to the measurement and verification requirements. Operations •Provide utility data as outlined in the Sustainable Building Policy on a monthyl or annual basis to ENERGY STAR and the DMC EDA. Any discrepancies between the energy target developed during design and operation should be evaluated and explained appropriately. Data will be uploaded for a period of at least 3 years. 134 DMC Experience Strategy To: DMC Corporation Board of Directors From: DMC EDA Staff Date: September 17, 2018 Overview: The Destination Medical Center (DMC) Initiative sets forth a plan to transform Rochester from what is perceived to be largely a medical campus, into a vibrant urban center and one of America’s model cities. To accomplish this, an over-all “Experience Strategy” is being created and aligned to enhance the quality of experience for patients, visitors and community members in Rochester. This comprehensive strategy is built upon the research and recommendations within the DMC Development Plan and collaboration with community partners/stakeholders. DMC Development Plan Goal #5: Achieve the highest quality patient, companion, visitor, employee, and resident experience, now and in the future Specific Objectives: -Create strategies, programs and services that support a world class destination -Develop strategies to enhance the quality of the experience for patients, visitors and residents In Rochester Experience Strategy -DMC worked with RSP Architects/Dreambox to help facilitate the creation of the DMC Experience Framework and Scorecard -Workshops with primary Partners (Rochester Downtown Alliance, Experience Rochester, Mayo Clinic and DMC EDA) were held in June and July 2018 -A draft of the DMC Experience Framework and Scorecard have been created and are ready for testing Rochester App Project -For the past 12 months Experience Rochester, Mayo Clinic and DMC have been partnering on the development of a mobile app that will serve the needs of community members, patients and visitors RST Airport Experience Improvement Project -The Rochester community is dependent on the Rochester International Airport for patient, leisure and business travel. In Q1 2018 DMC, Mayo Clinic and RST Airport came together to build a plan to improve the over-all experience at the airport. -In June 2018, the project moved into experimentation phase - a total of 5 experiments were be tested to improve the over-all experience at the airport. Experiments included: o Patient Travel: 135 Will destination travelers choose to fly RST if ground transportation is included? Anticipation of the patient traveler by greeting patient travelers by name as they arrive off the plane. Next Steps: Experience Strategy - DMC is identifying test experience concepts for 2018 and 2019 Rochester App Project - The app is expected to be completed in Q4 of 2018 RST Airport Experience Improvement Project - Project teams are being identified for implementation 136 Marketing & Communications Update 2018 Year-to-Date DMC Marketing Plan Objectives 2018 Year-to-Date: ● Build awareness and support DMC and Discovery Square development by driving qualified investor/developer, entrepreneur and life science leads and engagement ● Demonstrate continued momentum ● Drive traffic to targeted pages on DMC.mn, specifically Investor & Developer and Discovery Square pages ● Target Markets: Regional (upper Midwest) and select national audiences 2018 Results to Date: Advertising Key Highlights Investor & Developer landing page visits up 5x- now accounting for 14% of total traffic 131 leads generated through social media platforms Robust digital strategy yielding high click through rate of 0.26% (national benchmark ranges from 0.08 – 0.15%) Highest engaged markets: Colorado, Minnesota, Wisconsin, Illinois, Texas, Florida and Arizona Website Analytics DMC marketing efforts have been successful in driving increased traffic to key pages, including Investor & Developer, Discovery Square and Contact Us pages, with increased time spent on site and number of pages visited. WEBSITE SESSIONS (VISITS), TIME ON SITE, PAGES VISITED YTD Sessions Time on Site Pages Visits/Session Developer Visits Disc. Square Visits 61,165 +27.3%* +11.5%* +168.6%* +169.3%* (*Compared to 2017) 137 GEOGRAPHIC REACH Goal: Drive national traffic to DMC.mn by diversifying and growing audiences beyond Rochester and state of Minnesota. Success Metric: Geographic reach Description Target Metric Current Metric Geographic reach beyond Rochester 80% beyond Rochester Q1 = 77% Q2 = 81% Q3 = 81%** Geographic reach beyond Minnesota 67% beyond Minnesota Q1 = 69% Q2 = 72% Q3 = 72%** **through 8/31 Marketing efforts to audiences beyond Rochester and Minnesota are producing impressive results. Current geographic reach includes about 75 cities across U.S. Fluctuations occur depending on content (i.e. local events will spike visits from local traffic) however goal is to be above 67% outside Minnesota consistently Top cities beyond Rochester in order of visits include: Minneapolis, Chicago, Coffeyville, New York, Houston, St. Paul, San Francisco, Ashburn, St. Louis, Dallas, Philadelphia, LA, Washington D.C, Phoenix, Miami, Boston, Detroit, Seattle. Blogs and e-Newsletters (as of 8/31/18) Blogs Published Newsletter Sent Subscribers Reached 53 18 53,387 Open rate is 31.8% over the past eight months/18 newsletters. (Industry avg. = 22%) Click rate is 6.85% over the past eight months/18 newsletters. (Industry avg. = 2.2%) Social Media In 2018, DMC has been increasing social media posting and presence to communicate progress on projects, events, educational resources & information available on the website with strong increases in followers and engagement over 2017. Facebook Likes Twitter Followers LinkedIn Followers 138 6,693 3,698 364 +11.1% +7.4% +243.4% Popular Posts: Mayo Clinic #1 Hospital in U.S., DMCC Board Projects Approval, Maps Page The social media audience showed great interest in the Mayo Clinic #1 Hospital in the U.S. Banner dedication. The post reached an astounding 11,256 people organically, 526 reactions, and was shared 35 times. (This has been DMC’s most popular post) DMCC Board approving new projects had strong engagement: 4,924 organically reached, 891 people clicked through to read more. 139 Earned Media From January 1, 2018 – August 31, 2018, 1,416 DMC-related stories in the media were tracked. Year-to-date story highlights include: Bloom Waterfront Project, Discovery Walk, Chateau Theater, New DMCC Board Members, Integrated Transit Studies, Games on the Grass, Alatus Groundbreaking, Vyriad Rochester Expansion, Ken Burns Mayo Clinic Documentary, DMCC Board Meeting/Development Approvals, One Discovery Square Topping Off, New Mayo Clinic CEO, Mayo Clinic #1 Hospital, DMC Twin Cities Visit, DMC in the Community One Discovery Square Topping Off Medical Alley Networking Event in Rochester Minneapolis Best Practices Visit 140 Discovery Square Trademark Update To: DMC Corporation Board of Directors From: DMC EDA Staff Date: September 17, 2018 Overview: Discovery Square Trademark Applications have been filed and allowed in seven classifications which include: software; business services; business incubation; educational services; scientific and biomedical research; restaurant and catering services; legal services. Next Steps: A Resolution granting DMC EDA authorization to act on behalf of the Destination Medical Center Corporation (DMCC) regarding the Discovery Square trademark will be presented to the DMCC board at its September 25, 2018 meeting. Upon approval of the resolution, DMC EDA may begin licensing the Discovery Square mark to approved businesses and organizations via a trademark license agreement. 141 142 C. DESTINATION MEDICAL CENTER CORPORATION RESOLUTION NO. __-2018 Authorizing EDA as Agent for Discovery Square Trademark Licensing On Behalf of DMCC BACKGROUND RECITALS A. The Destination Medical Center Development Plan (the “Plan”) presented a 16- block sub-district known as Discovery Square (the “Sub-District”) as a focal point to expand research, technology, and related businesses and to foster the continued growth of the bio-medical and bio-technology community. B. The Destination Medical Center Corporation (“DMCC”) applied for federal registration of and owns the rights to the trademark known as DISCOVERY SQUARE (the “Licensed Mark”). The DMCC, the City of Rochester, Minnesota (the “City”), and the Destination Medical Center Economic Development Agency (“EDA”) have worked cooperatively and expended funds and other resources to develop and market the Sub-District and to create value in the Licensed Mark. Third parties doing business in the Sub-District may desire to be licensed to use the Licensed Mark for private business purposes. C. The DMCC wishes to ensure the quality of the Licensed Mark, and to protect against any potential infringements or unauthorized uses. The DMCC and the EDA entered the Agreement for Destination Medical Center Services dated February 1, 2014 (the “Services Agreement”). The DMCC previously granted the EDA an oral license to use the Licensed Mark to perform its marketing duties under the Services Agreement and now wishes to reduce this oral agreement to writing. The DMCC wishes to authorize the EDA, as its authorized agent (“Agent”), to grant and monitor license rights to the Licensed Mark and to provide quality control, all as Work performed under the Services Agreement and as otherwise directed from time to time by the DMCC. RESOLUTION NOW, THEREFORE, BE IT RESOLVED, by the Destination Medical Center Corporation Board of Directors that the EDA is hereby granted a royalty-free, non-exclusive right, license and privilege with no right of sublicense, retroactive to May 31, 2017, to use the Licensed Mark to perform the Work as defined under and subject to the terms and conditions of the Services Agreement, and consistent with the Development Plan. The DMCC remains the sole owner of the Licensed Mark and retains the right to control the nature and quality of the services provided. BE IT FURTHER RESOLVED, that the EDA is hereby designated as the Agent of the DMCC to grant to worthy applicants (“Third Party Licensees”) by written agreement (“License Agreement”) a non-exclusive, right, license and privilege to use the Licensed Mark consistent with the Development Plan and the Services Agreement. Such uses may include, without limitation, use of the Licensed Mark as part of a building name for any buildings located within the Sub- District (with internal and external signage and directories for said buildings); use in print and 143 2 digital marketing materials distributed to current and prospective tenants for said building; and use in online materials that describe said building and the other tenants of the building. A License Agreement may be executed only by the Executive Director or Chair of the Board of Directors of EDA after written approval by the Board of Directors of the EDA, and a License Agreement may include a fee payable by a Third Party Licensee to the EDA, as further provided below. BE IT FURTHER RESOLVED, that as the Agent, the Board of Directors of the EDA may propose reasonable and appropriate annual fees for use of the Licensed Mark for review and approval by the DMCC. The EDA may not charge any fee to the City or any other public entity for use of the Licensed Mark. Unless otherwise directed by the DMCC, the fees shall be used by EDA to defray the cost of quality control, enforcement, review and approvals and other administrative time dedicated to the Licensed Mark, as well as the further development and marketing of the Sub-District, and other sub-districts identified in the Development Plan. The EDA shall provide regular updates to the DMCC, at least annually, as to the Work performed relating to the Licensed Mark, the Third Party Licensees, enforcement efforts and brand integrity, and the receipt and use of all fees received from Third Party Licensees of the Licensed Mark. BE IT FURTHER RESOLVED, that as the Agent, the EDA shall safeguard and enforce the Licensed Mark against potential infringements or unauthorized users, and the DMCC shall assist with such efforts as reasonably needed. The EDA shall maintain federal registrations for the Licensed Mark consistent with the current use of the Licensed Mark. The EDA, as Agent, is hereby designated for the execution of documents required by the United States Patent and Trademark Office in connection with the registration and maintenance of the Licensed Mark (the “Trademark Documents”). Such Trademark Documents may include, without limitation, requests for extensions of time to file a Statement of Use, Statements of Use, Declarations of Use, Declarations of Incontestability, and Applications for Renewal. Only the Executive Director or Chair of the Board of Directors of the EDA may execute the Trademark Documents. BE IT FURTHER RESOLVED, that the EDA shall, both on its own behalf and, as the Agent, require any Third Party Licensee to recognize and acknowledge by License Agreement that: (1) the Licensed Mark and all rights and goodwill pertaining thereto belong exclusively to DMCC, that all rights resulting from licensee’s use of the Licensed Mark inure to the benefit of DMCC, and that upon termination of the License Agreement, all rights in the Licensed Mark shall remain the property of DMCC; (2) it will in no way represent that it has any right, title or interest in the Licensed Mark other than those expressly granted hereunder or under the Agreement; (3) it will not use or attempt to register in any country or jurisdiction, (a) any mark comprising or containing the Licensed Mark, (b) any translations or other language versions of the Licensed Mark, or (c) any other trademark, trade name, domain name, internet keyword, social networking identifier, or other designation similar in whole or in part to the Licensed Mark or to any other trademark of the DMCC or the EDA; and (4) it will not challenge the DMCC’s rights in, or the validity or scope of, the Licensed Mark, or any application or registration therefor, or the EDA’s rights as the Agent, to enforce the Agreement. BE IT FURTHER RESOLVED, that as the Agent, the EDA may establish reasonable use guidelines for the Licensed Mark, including a requirement that, except for signage and building directory listings, the most prominent use a licensee makes of the Licensed Mark must contain a trademark notice that states that “DISCOVERY SQUARE is a trademark owned by Destination 144 3 Medical Center Corporation and used under license” and that as a licensee EDA must follow such guidelines. BE IT FURTHER RESOLVED, that this license and appointment as the Agent shall be valid for the duration of the Services Agreement, subject to further direction from time to time by written resolution of the DMCC. This resolution shall take effect upon the adoption by the EDA Board of Directors of a resolution acknowledging and accepting the terms and conditions of this resolution. 1096754-4.DOCX 145 146 147 148 TO: Jim Campbell, Treasurer Kathleen Lamb, Attorney FR: Dale Martinson, Assistant Treasurer Date: September 18, 2018 RE: August 2018 Budget Summary The attached financial summary through August 2018 reflects year‐to‐date DMCC expenditures of $1,461,462 out of the approved 2018 budget plus carryover encumbrances totaling $2,963,974. The remaining amount unspent represents 51% of the available budget with 4 months, or 33% of the year remaining. You will remember at the end of 2017, DMC EDA staff received approval of a budget carryover encumbrance of $111,868.49 which represented open contracts at year‐end 2017. There was still $9,601 of this encumbrance remaining on August 31st of this year. The second page of this summary provides a listing of DMCC authorized projects managed by the City of Rochester. A total of $3.2 million has been spent on these projects in 2018 through August 31st. The largest share of spending was for the construction of the Broadway @ Center Parking Ramp followed by the DMCC Street Use Study. Total life‐to‐date expenditures on these projects was approaching $28.6 million. Please feel free to contact me with any questions or concerns. 149 150 Destination Medical Center Corporation Financial Budget Summary August 2018 2018 Approved Curent Month August 2018 Amount Percent Approved Budget August 2018 Year To Date Remaining Remaining General Administrative Expenses 41,200 2 16,142 25,058 61% Professional Services 294,500 19,054 102,482 192,018 65% Insurance and Bonds 20,000 11,041 8,959 45% City Support Expenses ‐ ‐ ‐ Subtotal DMCC 355,700 19,056 129,665 226,036 64% Third Party Costs ‐ DMC EDA ** Payroll, Staff, Administration & Benefits‐EDA 724,740 66,986 386,874 337,866 47% Operating Expenses 30,220 17,438 92,716 (62,496) ‐207% Operational Costs ‐ Contracted 43,880 1,179 16,103 27,777 63% Economic Development Outreach & Support 760,672 63,502 272,002 488,670 64% Professional Services 871,894 87,451 416,917 454,977 52% Miscellaneous Expenses 65,000 44,917 20,083 31% Subtotal EDA 2,496,406 236,557 1,229,530 1,266,876 51% Total DMCC 2018 2,852,106 255,613 1,359,194 1,492,912 52% 2017 Budget Carryover ‐ Encumbered Funds for Contracts 111,868 ‐ 102,267 9,601 9% Totals in 2018 Including Encumbrance 2,963,974 255,613 1,461,462 1,502,513 51% ** An additional MAP request in the amount of $84,508.97 was received in September for August DMC EDA expenses DMCC Working Capital Note 1,000 EDA Working Capital Note 50,000 151 DMCC Projects Managed by the City of Rochester As of August 31, 2018 Project YTD Expenditures Project Budget Life To Date Expenditures 8611C- - Sn/S12AvSW/NW<2StSW>2StNW 194,381 2,850,000 302,012 8612C- - WZmbrRvrSn/SRlfLin<CookPk>CCDr 8,079 950,000 46,036 8613C- - ChateauTheatrePre-OccupancyM&O 40,295 3,326,802 238,801 8614C- - DMCTransit&InfrastrctrPgrmMgmt 379,393 1,800,000 1,523,554 8617C- - Broadway @ Center Parking Ramp 733,913 10,500,000 10,500,000 8618C- - SharedParkngStudy&PrgmDevlpmnt 252,354 2,061,854 1,526,013 8620C- - City Loop Plan 221,305 1,209,938 942,126 8621C- - Transit Circulator Study 343,808 2,241,532 1,641,817 8623C- - DMCC Street Use Study 673,493 3,117,708 2,769,189 8624C- - ChateauTheatreBldgImprov/Purch 74,388 6,822,917 8625C- - Heart of the City 948,940 598,936 8626C- - Sn/SUpsize1Av&3AvSE<4StS>1StN 273,890 5,000,000 1,715,377 Grand Total 3,195,300 34,006,774 28,626,778 152 D. DESTINATION MEDICAL CENTER CORPORATION RESOLUTION NO. ___-2018 Approving the 2019 DMCC Board Regular Meeting Schedule BACKGROUND RECITALS The Minnesota Open Meeting Law provides that a schedule of the regular meetings of a public body shall be kept on file at its primary office. If a public body decides to hold a regular meeting at a time or place different from the time or place stated in its schedule of regular meetings, it shall give the same notice of the meeting that is provided for a special meeting. RESOLUTION NOW, THEREFORE, BE IT RESOLVED, by the Destination Medical Center Corporation (“DMCC”) Board of Directors that the schedule of regular meetings for 2019 is set forth below. The meetings will begin at 9:30 a.m., and the location will be at the Mayo Civic Center. The Secretary is directed to post the 2019 schedule on the website and to post notification by such other means as she determines necessary and appropriate. Date Time Mayo Civic Center Tuesday, February 5, 2019 9:30 a.m. Mayo Civic Center Thursday, May 23, 2019 9:30 a.m. Mayo Civic Center Thursday, September 26, 2019 9:30 a.m. Mayo Civic Center Tuesday, November 12, 2019 9:30 a.m. Mayo Civic Center 1098248-2.DOCX 153