HomeMy WebLinkAbout5/28/2020 DMCC Board of Directors Meeting - Agenda and Meeting PacketDestination Medical Center Corporation
Board of Directors Meeting
Thursday, May 28, 2020
9:30 A.M.
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DESTINATION MEDICAL CENTER CORPORATION (DMCC)
BOARD MEETING
Thursday, May 28, 2020
9:30 A.M.
Following the March 13, 2020 Declaration of Peacetime Emergency by Governor Walz (as
may be amended), the Destination Medical Center Corporation (DMCC) is holding its
regularly scheduled May 28, 2020 9:30 AM meeting by telephone or other electronic means,
according to Minnesota Statutes, Section 13D.021. DMCC Chair Rybak has concluded that
an in-person meeting and the regular meeting location for the DMCC is not practical or
prudent because of the health pandemic declared under the Emergency Order and according
to current guidance from the Minnesota Department of Health and the CDC. The public
may monitor the meeting by calling the phone number listed below or on-line through the
link below.
Dial-In Information:
Videoconference: https://us02web.zoom.us/j/81920197668
Teleconference: 1-301-715-8592, Code: 81920197668#
AGENDA
PAGE
I. Call to Order
II. Roll Call
III. Approval of Agenda 1
IV. Approval of Minutes: February 6, 2020 3
V. Chair’s Report
VI. Election of Officers
VII. Consent Agenda
A. Resolution A: Commending Nick Campion 7
B. Certification of Expenditures to DEED
Resolution B: Ratifying and Confirming the April 1, 2020 Report 9
to DEED Pursuant to Statute
C. DMCC 2020 Budget Year-to-Date Update: Receive and File 19
VIII. DMCC Audit for Year Ending December 31, 2019 23
(Presenter: Craig Popenhagen, CliftonLarsonAllen)
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IX. DMC Metrics
A. WMBE Goals 47
X. COVID-19 Organizational Responses 49
A. DMCC Executive Committee Direction
B. Mayo Clinic Update
C. EDA Update
D. City of Rochester and Olmsted County Update
E. COVID-19 Infrastructure Support
Resolution C: Approving COVID-19 Expenditures in the Public Realm
as Public Infrastructure Projects and Authorizing Expenditures
XI. 2021 DMCC Funding Request: Priorities, Process and Timeline 51
XII. Development Plan Five Year Update 53
XIII. Project Updates (City of Rochester, EDA)
A. Discovery Square 55
B. Heart of the City 57
XIV. 2020 Capital Improvement Plan (CIP): Reallocation of Funds 59
A. Heart of the City Snow Melt System
B. 1st Street NW Sanitary Sewer Diversion Project
Resolution D: Approving Amendments to the 2020 Five Year Capital Plan 61
XV. Transportation 65
A. Phase 1 Update
B. Development District Boundary Modification
Resolution E: Authorizing Submission of a Modification to the
Development District to the City of Rochester (West Transit Corridor) 67
XVI. EDA Update
A. Sustainability Building Application Amendment: Revision to Joint
Funding Application 71
B. District Energy Updates 73
XVII. Meeting Schedule
A. Next Meeting: August 27, 2020 at 9:30 A.M.
DESTINATION MEDICAL CENTER CORPORATION (DMCC)
BOARD MEETING
Thursday, February 6, 2020
9:30 A.M.
MINUTES
I.Call to Order. Chair R.T. Rybak called the meeting to order at 9:30 a.m. at Mayo Civic Center
Suite 101, located at 30 Civic Center Drive, Rochester, MN 55904.
Chair Rybak welcomed Pamela Wheelock, and highlighted Ms. Wheelock’s extensive
leadership experience across public and private sectors.
II.Roll Call. Chair R.T. Rybak, Mayor Kim Norton, Paul Williams, Jim Campbell, Commissioner
Jim Bier, Pamela Wheelock, and Council Member Nick Campion were present.
III.Approval of Agenda. Council Member Campion moved to amend the agenda to include
Resolution C regarding Discovery Square Two Project, under item XI. Commissioner Bier
seconded.
Ayes (7), Nays (0). Motion approved.
Council Member Campion moved approval of the amended Agenda. Commissioner Bier
seconded.
Ayes (7), Nays (0). Motion approved.
IV.Approval of Minutes: November 12, 2019. Commissioner Bier moved approval of the
Minutes. Council Member Campion seconded.
Ayes (7), Nays (0). Motion approved.
V.Public Comment Period. John Eischen, Executive Director of Rochester Area Builders,
informed the Board of the upcoming Rochester Home Show hosted in the Mayo Civic Center.
Dr. Lori Carrell, Chancellor of the University of Minnesota Rochester (UMR), highlighted
UMR’s role in developing and retaining a skilled workforce and its nationally-acclaimed work
to close the student achievement gap, and described UMR’s presence in One Discovery
Square.
.
Dee Sabol, Executive Director of Rochester’s Diversity Council, highlighted Rochester’s
participation in the Intercultural Cities Initiative.
Kenneth Bush, Rochester resident, thanked the DMCC, state agencies, and the City of
Rochester for hosting women- and minority-owned business certification information events.
Al Lun, Rochester resident, requested that DMCC Board meeting presentations be more
promptly archived on the DMC website.
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VI.Chair’s Report. Chair Rybak highlighted the annual DMCC-City report to the legislature. He
noted that a collaborative session with members of the DMCC, EDA, the Rochester City
Council, and the Olmsted County Board of Commissioners would follow the Board meeting.
VII. Consent Agenda
A.Resolution A: Authorizing an Extension to Agreement with CliftonLarsonAllen.
B.EDA: Request for Budget Encumbrance for 2020.
Commissioner Bier moved approval of the Consent Agenda. Council Member Campion
seconded.
Ayes (7), Nays (0). Motion approved.
VIII.Annual Report to the Legislature.
Resolution B: Approving February 15 Report to the Legislature. Council Member Campion
moved approval of the resolution. Mayor Norton seconded.
Ayes (7), Nays (0). Motion approved.
IX.DMC Metrics. Lisa Clarke, EDA Executive Director, provided an update on business
development. Her presentation included a map of the United States indicating the origins of
private financing for DMC-supported projects. Mr. Campbell stated that out-of-state financing
validates Minnesota as a target for investment. Council Member Campion noted that
measuring out-of-state investment may create or refine private investment targets.
Bill Von Bank, EDA Marketing and Communications Director, and Rob Rankin, President of
CCF, the EDA’s marketing consultant, described how marketing strategy has changed in
recent years to national tactics that leverage data analytics, paid search, and podcasts to
target specific audiences. These efforts resulted in a thirty-four percent year-over-year
increase in DMC website traffic. Chair Rybak asked if spikes in website visits from specific
locales were the result of targeted marketing or a specific event; Mr. Rankin responded that
CCF will examine this issue. Mayor Norton encouraged DMC’s retail and dining marketing to
focus on health. She also suggested that international relationships, including Rochester’s
five sister cities, could present global marketing opportunities. Ms. Wheelock stated that
marketing efforts should be tailored to create a sustainable mix of uses. Council Member
Campion asked the EDA to consider clear objectives in this area for 2020. Mr. Williams asked
the EDA to update its goals for targeted market outreach for 2020.
Ms. Clarke provided the final metrics report, updating the Board on WMBE and targeted
workforce goals. Council Member Campion suggested that the focus should be on results,
rather than goals, with an expectation to exceed prior results.
X. Project Updates
A.Heart of the City. Patrick Seeb, EDA Economic Development and Placemaking
Director, noted that Heart of the City bid respondents were asked to account for
DMC’s “Business Forward” strategy, which seeks to minimize the impact of
construction on patients, community members, and adjacent businesses. This strategy
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would likely increase costs by approximately eight percent. The EDA continues to
review bids and may present the Board with a recommended revised project budget.
Chair Rybak stated the importance of working with businesses through construction.
Mr. Williams noted the need to adapt and communicate throughout the construction
process. Mayor Norton described DMC’s public space investments as a community
benefit intended for residents, patients, and visitors. Ms. Wheelock stressed the
importance of managing expectations, recognizing that DMC funding is finite.
B.Transportation. Mr. Seeb stated that downtown Rochester will be a test site for the
State of Minnesota Department of Transportation Connected and Autonomous Vehicle
pilot program. Aaron Parrish, City of Rochester Deputy Administrator, noted that the
City expects to receive notice that it may apply for U.S. Federal Transit Administration
grant funding in September 2020. The City is in the process of selecting an
engineering team to complete design, traffic, and environmental reviews.
Land use concepts and site partnership terms for the transit villages are expected to
be presented at the May 2020 Board meeting. Chair Rybak asked if including housing
at the transit villages improves federal grant scoring outcomes.
Mr. Parrish stated that the increased ridership resulting from transit village housing
should make the grant application more competitive. Commissioner Bier also affirmed
Olmsted County’s commitment to develop housing at the east mobility hub.
XI.Discovery Square Two. The City and EDA staff recommended that the Board designate
Discovery Square Two as a public infrastructure project and approve $7.3 million in tax-
increment financing (TIF). Mr. Seeb described the staff analysis, noting that the TIF
recommendation includes a “look-back” provision that will decrease the TIF amount if an
anchor tenant is secured. Terry Spaeth, City of Rochester Assistant Administrator, noted that
transit-oriented development like Discovery Square Two will strengthen the district and
support DMC rapid transit efforts.
Council Member Campion emphasized the importance of job creation. Mr. Williams noted that
the recommended amount of TIF is nearly sixteen percent of the project budget. Mr. Spaeth
noted that although this approach deviates from the City’s TIF policy guidance, in considering
the different factors, the priorities of the district, and the role of strengthening transit
development, the recommendation is appropriate. TIF also is subject to City Council approval.
Mayor Norton noted that the approved TIF amount would be credited towards the City’s local
contribution. Ms. Wheelock approved leveraging the new tax increment to catalyze other
community needs. Commissioner Bier stated that this project provides an example of
attracting companies who seek to work with Mayo.
As to parking issues, Mr. Seeb noted that it is assumed that Mortenson and Mayo Clinic will
address tenant parking needs. He stated that Mortenson is willing to accept a parking-to-
building size ratio that is approximately one-half of a similarly sized medical office building and
to participate in a more comprehensive parking strategy. If a parking solution is not reached,
staff will advise the Board.
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Resolution C: Approving the Mortenson Discovery Square Two Development Project,
Contingent Upon Evidence of Financing. Mayor Norton moved approval of the resolution.
Council Member Campion seconded.
Ayes (7), Nays (0). Motion approved.
XII.Development Plan Five Year Update. Ms. Clarke stated that the Development Plan update
will be a topic at the collaborative meeting, and also presented at the May Board meeting.
Chair Rybak suggested that the Executive Committee could provide guidance to the plan
update process.
XIII.EDA Update. Ms. Clarke reported that the EDA may provide a district energy system update
at a future Board meeting and described the DMC Assistive Tech Challenge.
XIV.DMCC 2020 Budget: Year-to-Date Update. Commissioner Bier provided the DMCC budget
update.
XV. Meeting Schedule
A. Next Regular Meeting: May 28, 2020 at 9:30 AM
B.Next Executive Committee Meeting: March 26, 2020 at 9:30 AM
XVI.Adjournment. Council Member Campion moved to adjourn the meeting. Mr. Campbell
seconded.
Ayes (7), Nays (0). Motion approved.
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A.
DESTINATION MEDICAL CENTER CORPORATION
RESOLUTION NO. ___-2020
Commending Nick Campion and Expressing Gratitude for His Service
to the Destination Medical Center Corporation
BACKGROUND RECITALS
WHEREAS, in January 2019, Nick Campion was appointed by the City of Rochester,
Minnesota (the “City”) to serve as a member on the Destination Medical Center Corporation
Board of Directors (the “Board”); and
WHEREAS, Mr. Campion has been actively engaged in the establishment of Board
policies and procedures, with a particular focus on transparency and good governance for the
Board; and
WHEREAS, Mr. Campion offered a unique perspective to the Board, by virtue of his
tenure on the Rochester City Council, his background in computer information systems and
engineering technology, and his expertise in zoning, planning and the development process, not
to mention his participation in so many other civic, educational, cultural, and athletic
organizations; and
WHEREAS, Mr. Campion’s focus and the strategic emphasis he offered in the critical
area of transit and transportation infrastructure was extremely helpful to the Board; and
WHEREAS, Mr. Campion has been instrumental in the deliberations and refinement of
the Development Plan for the Destination Medical Center initiative and in framing the Board’s
priorities in these areas: Discovery Square, Heart of the City, and transportation initiatives; and
WHEREAS, Mr. Campion’s commitment to the citizens of Rochester and the
surrounding communities has been steadfast and well-reflected in his service on the Board, and
his stewardship of the Board’s mission and purpose has been unwavering.
RESOLUTION
NOW, THEREFORE, BE IT RESOLVED, by the Destination Medical Center
Corporation Board of Directors that it commends Nick Campion for his service to the Board, to
the community and to the State of Minnesota.
BE IT FURTHER RESOLVED, that the Board expresses its gratitude to Mr. Campion
for his devotion of time and energy to the Board, for his leadership in establishing priorities for
the Board, for his engagement on issues and willingness to share expertise, and for his resolute
determination to make Rochester, Minnesota, America’s City for Health.
1235741-3.DOCX
7
8
B.
DESTINATION MEDICAL CENTER CORPORATION
RESOLUTION NO. ___-2020
Ratifying and Confirming the April 1, 2020 Report to DEED Pursuant to Statute
BACKGROUND RECITALS
A. Minnesota Statutes, Section 469.47, provides that by April 1 of each year, the
medical business entity (Mayo Clinic) must certify to the Commissioner of the Department of
Employment and Economic Development (“DEED”) the amount of expenditures made by Mayo
Clinic in the preceding year. For expenditures made by an individual or entity other than Mayo
Clinic, the Destination Medical Center Corporation (“DMCC”) must compile the information on
the expenditures and may certify the amount to DEED. On March 26, 2020, pursuant to
Resolution No. EC-6-2020, the Executive Committee of the DMCC Board authorized the Chair
or Treasurer of the DMCC to execute and submit the report to DEED (the “April 1 Report”), and
to modify the report as necessary upon subsequent discussions with Mayo Clinic or the City of
Rochester (the “City”).
B. The April 1 Report is attached as Exhibit A.
RESOLUTION
NOW, THEREFORE, BE IT RESOLVED, that the Destination Medical Center
Corporation Board of Directors ratifies and confirms the action of its Executive Committee and
the April 1 Report and its submittal to the Minnesota Department of Employment and Economic
Development as required by Minnesota Statutes, Section 469.47, and authorizes the Chair or
Treasurer to make such other modifications, and to take such other actions as are necessary and
appropriate to effectuate the submission of the report to DEED.
1235742-3.DOCX
9
A-1
EXHIBIT A
10
Certification of Expenditures
Destination Medical Center
For Calendar Year 2019
D ue to Commissioner of Employment and Economic Development (DEED) by April 1
The Medical Business Entity and the Destination Medical Center Corporation (DMCC) Board of Directors (assisted by the
City of Rochester) hereby submits to the Department of Employment and Economic Development {DEED) the following
report for expenditures that relate to the Destination Medical Center (DMC) Development for the calendar year 2019,
a nd the cettificatlons required to support the documentation under the City of Rochester Commissioner of Employment
and Economic Development State Infrastructure Aid Agreement.
Expenditures Reported this Year
Total Expenditures Reported This Year by Med(cal Business Entity' $139,126,160.79 i
Total Expenditures Reported This Yearfor other Private Entit(esi'Z $133,004,08D.65 z
TOTAL Expenditures Thfs Year $272,130,241,44 3
A ll Expenditures claimed since June 30, 2013
Previous Years Expenditures (cumulative)
TOTAL Expenditures This Year from aox s~
All Claimed Expenditures as of SZ/31/19 (Box 4 plus Box SJ
Qualified Expenditures claimed in 2019 (eox s minus $zoo,000,00a)
State Ald Qualified for this Year (local government match also required)
General State Infrastructure Aid Qualified for (aox ~ mu~~ipued by .oz~s)
State Transit Aid Qualified for (eox ~ multiplied by.0075 and then multiplied by.5~
$690,664,413.37 q
$272,130,241.44 s
$962,794,654.81 5
$762,794,654,81 ~
$20,976,853.01 s
$3,432,575,95 s
By providing my signature below, I am hereby certifying that, to the best of my knowledge, the information stated herein
is accurate, true and compiles with the provisions of Statute 467,47 of the State of Minnesota and the approved
methodology as outlined In the Clty of Rochester Commissioner of Employment and Economic Development State
For Expenditures By the Medical Business Entity;
M ayo Clinic Chef Financial Off(cer Date
other Expenditures:
~?l~~ /~ o Z c~
DateMed(cal Center Corporation
1 Expenditures need to be after June 30, 2013
Z Other Private Entities' certification of expenses may be certtfled retroactively In 2014 after the Destination Medical
Center D(strict and Development Plan are adopted. This figure (s based solely upon project building perm(t costs. Minn,
Stat, § 469.47, subd 1(d) permits additional expenditures, and discussion is underway as to how to document such
additional expenditures, which may result in adjustments.
Form Revised 03/16/2020
1193727-2.xisx
EXHIBIT A
11
2019 Tracking Worksheet
Building Permits within the DMC Boundary
(Does not include Mayo Projects)
Year
2017
2018
2019
TOTAL
Completed
Projects
$ 2,050,000.00
$7,748,655.00
$5,662,402.00
$15,461,057.00
2018/2019 Destination Medical Center -Partially Completed Projects Tracking
Project Address Total Building Permit Value
?Aii 2029
Partial Completed Work
Claimed Completed Work Claimed
Ronald McDonald House 850 2nd Street SW $ 10,126,000.00 $ 4,872,363.01 $5,253,636.99
Hotel Indigo (Holiday Inn)220 South Broadway $ 10,500,000.00 $ 1,156,333.15 $9,343,666.85
Residence @ Dis. Sq.Sii 3rd ave. Sw $ 19,000,000.00 $ 9,820,880.09 $9,179,119.91
U rban on First 429 South Broadway $ 30,808,958.00 $ 12,455,954.00 $18,353,004.00
Berkman (Alatus)217 & 301 14th Ave SW $ 93,315,800.00 $ 25,936,546.00 $59,063,337.00
163,~so,~ss.00 S sa,ia2,o~6.zs $ 10I,192,764J5
2019/2020 Destination Medical Center -Partially Completed Projects Tracking
Project Address Total Building Permit Value
2019 2020
Partial Completed Work
Claimed Completed Work Claimed
R yan/Wells Fargo 21 1st SW $ 5,250,000.00 $ 5,250,000.00
H yatt House 315 1st Ave. NW $ 32,253,475.00 $ 6,940,448.00
Eleven02 101 11th Ave. SW $ 30,255,765.00 $ 4,159,810.90
6~,~s9,2ao.00 $ 16,350,258.90 S
TOTAL ' $ 133,004,080.65
12
GgAPLEfEORFRTI~L BI11LdNO PERMRS
(WXM1in OMC BounOery. Eoes rro~ mciuW Meyo Prohcl+)
Sub Type LevN - Gbpory L~wl Carmrt Number Pormit Issue WM~In DMC Wrtsl Atltlna lnb WrmR V~lwlron YWh D~xrgtbn
ab Bou~ry Numwr
Comerwrc4~BMp ~Ibntlon R18-0HlCB ]2Y101I Vva 082G3p ]OBS BRO~PNAV EVE.S2.OSO.OW RIIenUoro of Mew lBiw oll'm on 5.
ROCHESTER. MN SSW B.l krela onh ~~~roD ~~~~w~
lRaxi~Ma B~MI
Comrmrtul BWp RuaM G~rMI R11R1MCB liYlOtl Yn Otip]B 10ECENTER ST. ROCHESTER.51S000.00O CP<p~cbq Coro WiNirq ~M aMB, rq
PermR MN SSWd MEP's (N~Ron on BruMnyl
Comriwrtul BWp Haw RISpM]CB 1118~1~11 Yes 01)WB 10E CENTER ST. ROCHESTER.S]6.3E].B CP-6 ir~4ror M~up b~]BBSiOp R. 19
MN 559pC Aory. 281 Gobi reams
Mikan an &e~ew~Yl
(IrohdeE rn lM PeN~I EwW~dun CKQNbMlMt I S Z.Ob0.000
Mryo Lic Pnl Onwr CuneM Porm~Cumn ParmM
Propct SbM SMu~ Dula
No ~LVIN E BENiNE, iNC BLOOM iNiEPoMTWNL REALTY LLC CoIC tbv1019
MRONE BENINE ZOB BROAOW~Y 5
Zppp W Ilwy t~SUITE X00
ROCHEStER. MN 55W1 ROCHESTER. MN S~B01
No NMUS-hNpERSON OpNSTRUCTION Lrypry FUM I, LLC FlraW Y16M19
CA 30 3 Sf SE
NICK LEIMER ROCNESTEF. MN SSiD1
~t8 S BROADW~V
ROCHESTER. MN SSW
No KM1A-~NOERSON CON51RlICTiON Leery FUM i, LLC Fliwlaa l/2YN18
CA 03515E
NICK LE1MER ROCHESTER. MN SSB01
1185 BRWDW~Y
NOCHESTER. MN SSWI
13
20tB BudCing Permits
COMPLETED /PARTIAL BUILDING PERMRS
~Wthin DMC Bountlary. Oces not inclutle Mayo Projech)
Sub Type Level Category Level Partnd Number Permit Issue Parcel Pdtlress Mfo PermR WOM Deunptbn Amer Curtent Pertnd Cunerrt Permfl
Data Number Veluatlon Status StaNs Gate
Commercial Bitlg Alteration R17-0435CB 1/16/2018 082430 206 5 BROADWAY AYE,$298,00 Intenar renovation for ofFce fit out Oxford Managertrent CO 5/t8201
ROCHESTER, MN 55904 (Associatetl Bank 5th Poor, Suite 500)206 BROADWAY 5
STE 400
ROCHESTER MN 55904
Commercial Bldg Phesetl Partial R17-0492CB 424201 050075 202 SW 4 ST, ROCHESTER, MN - #ice;. 'Phased partial permtt for complete core Morten6on Properties, Inc.CO 7/10801
Perrtnt 55902 ~end shell. (Disrnvery Square Phase 1)700 Meatlow Lane N
Minneapolis. MN 55422
Commercial Bldg AddRion 878-OO48C6 792018 OB2445 &50 SW 2 ST, ROCHESTER. MN ~[it 1 AdOttion o/ 30 guest moms and parking Ronaitl McDonalA House CO 11/4207
55902 -stalls. (78150200 / Ronaltl McDonaltl Dava EiEe
House)B502nO StSW
Rochester MN 55902
Commercial Bldg Attaretlon R1B-0104C8 8/132018018054 121 N BROA~WAV AYE,51,989204 Historic renovation o(former armory CASTLE COMMUNITY LLC CO yg/lp1
ROCHESTER, MN 55906 builtlmg. (Castle Community)Scott Hoss
175-12 North Broadway
ROCHESTER MN 55908
Commercial Blag Atteretion 878-0294CB 8/70@018 080524 220 S BROADWAY AYE,350tl,00~SelecCrva tlemolRion of the Intmior,Ebbie Nakhjaveni Issued 8H 02018
ROCHESTER, MN 55906 exterior facade ane roof structure to 220 Newport Center Dr
prepare for future building alteration.Suirte 11-262
MohEa Inn - Rxhester New rt Beach CA 82660
Commercial 8ltlg Atteretion R18-0335CB 9/12f2018077926 21 SW 1ST, ROCHESTER, MN S9B.00 demolition of 8th floor space tosell ROCHESTER PROPERTY ONRJER Finaled 1/8201
55902 contlftion Interior only for future tenant LLC-Tirtpthy Gray
(Walla Farga)533 SOUTH THIRD ST
STE 100
MINNEAPOLIS MN 55415
Commercial Bldg Attaretion 818-023908 924/2018 082x39 412 SE 3 AVE A 8 8, ROCHESTER,5450,00 Tenant buittl out of space A 8 B inW a bar,flap on 4th CO 0/42019
MN 55904 caf6 and bungs. (FitltlleheaE Catd)412 3b Ave SE
RocheStar, MN 55904
Commercial Bldg AI[eretion 818-028908 10/9/201 017887 1 W SW 1 AYE, ROCHESTER, MN $283,66 Intetlor M-up of leasetl space for a coffee Joen V~lson CC 8/52019
55902 shop adjacent to Peace Piaze, (MOKA 513 Mein St
Coffee -Peace Plaza)Sutte C
LaCrosse WI 54801
Commercial Bldg Add'Rion R~8-0221 CB 10252~~8018448 301 N BROADWAY AYE,51,175.00 2920 sq. ft. atltlition with some remodeling ABM IDEATIONS LLC CO t?l5/101
ROCHESTER, MN 55806 inaitle to whtte box main (T~e Biatro-tst 4004 AUTUMN LAKE CT SW
Ibor); one new aparlmeM antl one ROCHESTER, MN 55902
exisNn 3rtl floor Avebn BuiWin
Commercial Bleg Alteration Rt8-0399CB 11/782018082430 208 S BROADWAY AYE.5230,00 Flt up of Me thlrE floor Nortmvest Cromer o Alan Hiniker CO 2H 7201
ROCHESTER, MN 55904 Dwltling for new tenant. (Meyer Borgmen 3270 19th St NW
Johnson Rochester OtRce)N270
Roc~erter MN 55901
Commercial Bltlg New R~8-0323CB 11272018083795 202 SW 4 5T, ROCHESTER, MN $2,012,Tenets flout on rivo levers of Me new SILVER LAKE INVESTORS /MAYO CO 7/10201
55902 DlaCovery Square building. BWlding CLINIC
collaboration and IaE space on the floors.700 Meadow Lane North
Discove 5 uere - U of M ROCHESTER MN 55422
Commercial Bldg New 818-0404CB 11/3/2018 083795 202 SW 4 ST, ROCHESTER. MN $728,788 Tenant 6uiltl out of once space on first Epic Systerrn Corp CO 4/242018
55902 Boor (Epic Systems)iB79 Milky Way
Verona, WI 53593
Commercial Blag Atteretion 818-038908 ~2l72018 080524 220 S BROADWAY AYE,55.000,RemoCal of existing hotel rooms floors 6-Jim Toninato 700 luuetl 1/102020
ROCHESTER, MN 55904 B (Hotel Intligo - Oltl Holiday Inn)5713 GrenA Ave
Suite B
DuluN MN 55807
Commercial Bldg Atteratian 818-040708 17H 0201 017887 20 SW 7 ST, ROCHESTER, MN $t45,~0 Frt-up br a new restauant (Jerk King Johnson Osei CO 5/14Q0
55902 Restaurant)20 1st Sl SW
Rochester, MN 55902
M ufti-Family Bldg Phasetl Partial 817-0157MF8 2/212018002485 2175W 14 AYE. ROCHESTER, MN 84,90 ,Alatus-Footing & Pountlatlon "Tower Rochester MN Properties, LLC Issued 2212018
Permit 55902 Only" (2nd Street Housing MizeC-Use 800 NICOLLET MALL
Development)STE 2850
MINNEAPOLIS MN 5542
14
2018 Building Permits
COMPLETED /PARTIAL BUILOINO PERMITS
(WiMin DMC Boundary, tloes nat inciutla Mayo Projects
Mutts-Femiry Bldg Phased Partial Rt7-0143MFB 227/2018 083fi87 511 SW 3 AVE, ROCHESTER, MN '. f1 750,6 Story Mutti-Femiry Apartment Building RESIDENCE AT OISCOVERV SQUARE FineleE 8/302019
Permit 55902 wim Mixed-Use Commeroiel (Resitlence LLC
at Discovery Square) Footing/Foundatlon 208 SOUTH BROADWAY
imcluding Pretest Plank Installation ROCHESTER, MN 55904
M utts-Fartaly BIOg New R17-0141 MF8 5/182018 017718 517 SW 3 AYE, Rochester, MN 517,250,6 Story MuMi-Family Apartment Builtling RESIDENCE A7 DISCOVERY SQUARE TCO Issuetl 8/28201
55802 with Mixetl-Use Commercial (Residence LLC
at Discovery Square)208 SOUTH BROAOWAV
ROCHESTER, MN 55804
Multi-Family Bldg Pheced Partial R18-0003MF6 521201 077770 425 5 BROADWAY AYE,E2,428,BS Foundation pertntt application for new URBAN ON FIRST LLC -TRan Finaled 17/18201
Perms ROCHESTER, MN 55804 mufti-family housing EeveloprtieM. Two Dwebpment
levels of parking end 5levels of refitlerMa 30 3 ST SE
sousing. (UrEan on Frrst)STE 600
ROCHESTER MN 55804
M ufti-Femlly BICg New R1B-0011 MFB BIB201B 002495 217 SW 14 AYE, ROCHESTER, MN C' 588237,50 New multi-use resitlentlel apartment Ashley eisner TCO IasueA 1118202
5591Y2 Cullding wiM retell antl perking (2nd St 800 Nicollet Mall
M rsad Use Devabpment Tower Only)Suite 2850
Minnea lis MN 55402
Multi-Femity Bldg Atteretion R18-0072MFB 8232078014472 431 SE 3 AYE, ROCHESTER, MN S3a0 00 Existing R-2 apartment atteretion to Mtly FrieOenc~a CO 10/18207
55904 convert from 50 units to 25. (Clint 10877 110 ST SE
Sudes CMA7FIELD MN 55923
M uttFPamily 8Mg New 218-OO15MF8 815201 017770 425 S BROADWAY AYE,528.380,00 New mu16-tartnly housing devebpmaM.UR&4N ON FIRST LLC -Titan CO ~ 1/19201
ROCHESTER, MN 55904 Two levels of perking and 5levals W Development
esitlential housing. (Urban on Pirst~30 3 S7 SE
STE 800
ROCHESTER MN 55904
MuttFFamily Bldg New R'I B-0037MFB 10/3/207 084709 301 SW to AYE, ROCHESTER. MN 52,178,20 Low nu 45 and apartment builCing with 2 ROCHESTER MN PROPERTIES LLC Inuetl 10/320'18
55902 walk up unds (EWU1 8 EWU2) attaMeC 800 NICOLLET MALL
m tower CwWing (RiB-0011MFB).STE 2850
(Berkman)MINNEAPOLIS, MN 55402
IncluCep on tMe Pertitli E nCiWie GtedR Worksheet S 7.7x8.655
15
2019 Building Permits
Completed /Partial Building Projects
(within DMC Boundary, does not include Mayo Projects
Sub Type Level Category Level PermA Number Permtt Issue Parcel Atldress Info Permit Work Descrip4on Ovmer Curterrt Permit Currerrt Permd
Date Number Valua[ian Status Status Date
Commercial Bltlg Alteration R18-0324CB x/42019081707 20 SW2AVE, ROCHESTER, MN 5200.000 Replacemerrt o~erzterior emergenq KAH 2O 2ND AVENUE LLC -Christopher Finaletl 4f1/20t9
559 2 egress stair (Kahler Grand Hotels Ness
20 2 AVE SW
ROCHESTER MN 55902..
Commercial Bitlg Alteration R'I&0376CB X82019 083045 10 E CENTER ST, ROCHESTER,51.650,000 Tenant improvement in first Moor space of 7ttan Development - Bnan Moser C of O Issuetl 7/82019
MN 55904 LF-I Broativay at Center project 30 3 57 SE
(Pinsburgh Blue Restaurant) STE 600
ROCHESTER, MN 55904
Commeraal Bldg Alteretion R~&0454C8 3/8/20'19'080524 220 S BROADWAY AYE,f5,000,WD' Remodel ofexisting hotel rooms antl Jim Ton~nato TCO Issued 'I/132020
ROCHESTER. MN 559M suOPort spaces on floors t. 2, 8 3 (Hotel 573 G2r~tl Ave
-. .Irxligo) Swte B
Duluth MN 55807
Commercial 81tlg Alteration Rt&0227CB 3/'I520t9 017882 X50 S BROADWAY AYE,E~6'I,000 Front entry antl Ear recon(guranon BGD5 HOTEL LLC Flnaled 5ld0.2019
ROCHESTER, MN 55904 Upgratle of mtenor finishes (Pescara - 30 3 S7 SE
Double Tree HMep STE 600
ROCHESTER MN 55904
Commercial Bldg Alteration R1&OPa4CB 42/201906801 155E 15T, ROCHESTER. MN $143,BSOSky~ay level cornaor fit-up antl whirebox ROCHESTER DEVELOPMENT INC Finaletl 6/1 7/2019
55904 tenant space (Broadway Plaza) 7679 LITTLE RIVER TPKE
STE 650
ANNANDALE. VA 72003
Commercial BIEg Alteration R19-0032CB 4/9/20'19 OBt707 20 SW 2 AYE. ROCHESTER, MN 5505.000 Intenor tenant finish for new Qtloba CMP Foads -Mark or Leigh Miller C of C issuetl 1 W92019
55902 Mexican Restaurant. (~tloba Mezipn 16694 206th Circle
Eats) Hu[chinwn. MN 55350
Commercial eltlg Alteration R19-0037CB 4/ 52019 083045 10 E CENTER ST 2A,'. $655,000 Restaurant tenarrt fit up. (Hilton Cafe) LEGACY FUND 1 lLC L of O Issued 726/2019
ROCHESTER, MN 55904 30 3 ST SE
STE 600
'.ROCHESTER, MN 55904
Commercial Bltlg Alteration R1 Y0104CB 42920'I9 083045 10 E CENTER ST, ROCHESTER,5~52.SBO Tenant improvement inclutling completion Cambria C of O Issued 8262019
MN 55904 of electnpl antl mecharncal as well as 31496 CamDna Ave
finishes Cambria Gallery LeSueur. MN 56058
Commercial BIOg Alteration R19-00'1608 5/132019 083795 202 SW 4 ST, ROCHESTER, MN $250,300 Bw10 out for a cafE on level one. Silver Lake Investors C of O Issuetl 8!2/2019.
55902 {Discovery Square) 700 Meadow Lane North
'..Minneapolis, MN 55422
'Commercial Bldg Alteration R'130127CB S2320t9`A8'1707 20 SW 2 AYE, ROCHESTER, MN 545,000 Installation of new MUA and EF unit, antl Kahler Hospitaldy Group Finaled ~ tn9/2019
55902 all associated tluct for krtc~en exhaust for ' 7~7 3b Ave SE
new tenant space (Hahle~/OtloDa greaseRochester. MN 55904
tlucY improvement)
Commercial Bltlg Alteration R19-0~15C8 6/182019 082430 206 5 BROADWAY AYE,8549.2'12 Renwabon of existing brench bank Doug Harber C of C Issuetl ~ ~2~f2019
ROCHESTER, MN 55904 (Assoaated Bank) %55 Campus Dr
Plymouth. MN 55441
Commercial Bltlg Alteration R'19-0186CB 6/t82019i7iD804~9 '519 SW t AYE. ROCHESTER, MN 822,576Remove antl replace walls antl ceilings In People's Food Coop Flnaletl 6/18/2019
55902 the meat prep room Layout to remain the 519 1s1 Ave SW
same. (People's Footl Co-op) Rochester, MN 55902
Commercial Bitlg Alteration -R19-006908 715/2019083045 70 E CENTER ST 141 $65.000 Tenarri imprrnements to inclWe Rochester Hospdaliry Group, LLC Cot 0 Issuetl 12272019
ROCHESTER, MN 55904 completion of mechanical. pumMrg antl 212 2n0 St Se Su Re Y25
electripl as well as fi nishes (Hilton Lobby Mlnneapohs. MN 55414
-Bar)
Commercial Bldg Alteration R~&0101CB 7/92019'.983795 402 SW 4 ST, ROCHESTER, MN 5543,294'Tenant Improvement occupies space on Silver Lake Investors C of O Issuetl 9/30/2019
'55902 the thlrtl level oFthe new Discrovery Square 700 Meatlows Lane North
BuiMing Builtl oN inclutles oNices antl lab Minneapolis. MN 55472
space (Wuxi Diagnostics
16
Commercial eltl9 Alteration R110244C8 7/24/2019082430 206 S BROADWAv AVE,$98,600 Repair to elevator shah vans and stairway BLOOM INTERNATIONAL REALTv LLC C of C Iwuetl 8272019
ROCHESTER, MN 55904 walls and fi re stopping of penetrations. 206 BROADWAY AVE S
(Associated Bank Builtling) S7E 500
ROCHESTER. MN 55904
Commerdal Bitlg Alteration Rt9-O'ASCB BIt6fI0~9983795 202 SW 4 ST 220, ROCHESTER,E460,990 New oRce/lab tenant improvement (Suite Sliver Lake Investors C of O lssuetl 1 VU2019
M N 55902 220 Discovery Square Bu~ltling) 700 Meatlow Wne North
Minneapol5. MN 55472
Commercial Bldg Alteration R19-0286CB 10/142019 Oi7897 101 SW 1 AYE. ROCHESTER. MN 8100,000 Expantlirg Caribou Coffee into tie Matt Masiw C of C Issuetl i 1/820'19
55902 neighEoring tenor» Space -Freshens 2900 Lakebree2e Ave North
I ncreasing eating (Caribou CoRee1 Brooklyn Center, MN 55429
Mufti-Family Bidg Alteration R130002MFB 1/29I2019A18102 211 NW 2 ST 20'10, ROCHESTER,Sa5,000 Alteration to suite 2010 CHARTERHOUSE INC-Deborah Kenitz Flnaietl 4/'15/2019
M N 5590'I 2tt 2ST NW
ROCHESTER. MN 5590'I
Mufti-Pamity Bidg Alteration Rt9-0054MFB 8/72019-018102 2~t NW 2 ST 18'16. ROCHESTER.515.000 Apartmerrt renova➢on (Charter House) CHARTERHOUSE INC-Scott Green finaleC 11/13@019
MN 55901 211 2 ST NW
ROCHESTER, MN 55901
Commercial Bltlg Atltlition R'I&0029C8 Sn620'19 Ot7926 21 SW t ST. ROCHESTER. MN -`55,250;000 AtltlAion of Jewel Box, re-skinning of ROCHESTER PROPERTY OWNER Issued 5/162019
55902 ' exterior taGatle, relocating tlameshc water LLC -Tony Barronco
I n Peace Plaza antl installation of new 533 SOUTH THIRD S7
elevator (Wells Fargo Downtrnvn) S7E 100
MINNFAPl11 IR MN 55415
Demolaion Commercial R~40003D 7l2820~9 075697 315 NW 1 AYE. ROCHESTER, MN 583,000 Demolition of existing American Legion EKN Development Group Issued 2282019
55901 bantling, inclutling removal o~ existing 720 Newport Center DR
asphalt parking ioUcurbs: for NNre Newport Bead. CA 92660
coristruc[ion of Civic on FirsFHyatt House
hninl nrruert
Commercial Bldg Phasetl Partial R~8-6967CB 5/16/2019 075697 315 NW 1 AYE, ROCHESTER, MN 53,710,W0 Placement of new footings, drilletl piers, EKN DeveloDmeM Group- Ebbie Issuetl 5/16f2019
Permit 55901 structural fountlatwns antl 3levels of post Nakhjavani
tensionetl concrete for a new 8 story hotel 220 Newport Center Or
(Civic on First) Suite 11-262
NPwnnrt Rear. C:A 91fi60.
Commercial Bldg New Rt&0078C8 7/302019 075697 315 NW i AYE, ROCHESTER, MN $28,480,475 New i72 room hotel wi(h 2levels o/ Chic Center Hotel JV, LLC luuetl 7/3D/2p19
55901 parking. Common amenrtiec On 1st floor 180 North Unrve~srty Ave
mclutle meeting rooms, swimming pool, Suite 200
guest kitchen arW IobCy bar (Civic on First_ Provo, UT 84601
Commercial Bltlg Phased Partial R'19-0206C8 102/20 9 075680 101 SW 11 AYE. ROCHESTER, MN 56,750,000 Footing, fourWation aritl untlergrountl Tyler Miles Issuetl 70/220'19
PermR 085073 55902 utiiRies for new hotel package (Eleven02 70'I9 West Atherton Drive
Hotel) Taylorville, UT 8423
~lr~dudetl on the Partial FMpendRun CtedU Wbrksh~et $ 5,662,402
17
18
TO: Jim Bier, Treasurer
Kathleen Lamb, Attorney
FR: Dale Martinson, Assistant Treasurer
Date: May 21, 2020
RE: April 2020 DMCC Budget Summary
The attached unaudited financial summary of activity through April of 2020 reflects total year‐
to‐date DMCC operating expenditures of $602,980 of the $2.873 million approved 2020 budget.
The remaining amount unspent represents 79% of the total budget. There was also an
additional payment request of $105,678.78 submitted in May for April activity.
The second page of this summary provides a listing of DMCC authorized projects managed by
the City of Rochester. Approximately $1.8 million has been spent on these projects this year
through April of 2020. Total life‐to‐date expenditures on these projects is approaching $41.8
million.
Please feel free to contact me with any questions or concerns.
19
20
Destination Medical Center Corporation
Financial Budget Summary
December 2020 (unaudited)
2020 Approved Curent Month April 2020 Amount Percent
Approved Budget April 2020 Year To Date Remaining Remaining
General Administrative Expenses 41,000 ‐ 8,346 32,654 80%
Professional Services 225,500 900 19,436 206,064 91%
Insurance and Bonds 20,000 ‐ 10,874 9,127 46%
‐ ‐ ‐
Subtotal DMCC 286,500 900 38,655 247,845 87%
Third Party Costs ‐ DMC EDA **
Payroll, Staff, Administration & Benefits‐EDA 965,481 57,045 204,706 760,775 79%
Operating Expenses 69,695 9,724 40,580 29,115 42%
Operational Costs ‐ Contracted 2,779 4,739 (4,739) #DIV/0!
Economic Development Outreach & Support 807,200 98,768 170,211 636,989 79%
Professional Services 677,770 26,817 144,088 533,682 79%
Miscellaneous Expenses 50,000 ‐ ‐ 50,000 100%
Subtotal EDA 2,570,146 195,132 564,325 2,005,821 78%
Total DMCC 2020 2,856,646 196,032 602,980 2,253,666 79%
2019 Budget Carryover ‐ Encumbered Funds for EDA Contracts 16,800‐ ‐ 16,800 100%
Totals for 2020 Including Encumbrance 2,873,446 196,032 602,980 2,270,466 79%
NOTE: A payment request for $105,678.78 was submitted in May 2020 for April 2020 activity.DMCC Working Capital Note 1,000
EDA Working Capital Note 75,000
21
DMCC Projects
Managed by the City of Rochester
As of April 30, 2020 Project YTD
Expenditures Project Budget Life To Date
Expenditures
8611C- - Sn/S12AvSW/NW<2StSW>2StNW 28,790.61 2,850,000.00 551,811.43
8612C- - WZmbrRvrSn/SRlfLin<CookPk>CCDr 950,000.00 46,592.09
8613C- - ChateauTheatrePre-OccupancyM&O 35,653.69 4,826,802.00 407,008.50
8614C- - DMCTransit&InfrastrctrPgrmMgmt 8,422.00 3,260,524.00 1,824,811.98
8617C- - Broadway @ Center Parking Ramp 10,500,000.00 10,500,000.00
8618C- - SharedParkngStudy&PrgmDevlpmnt 35,297.79 2,061,854.00 1,874,219.10
8620C- - City Loop Plan 1,209,938.00 968,732.35
8621C- - Transit Circulator Study 2,241,532.00 1,780,876.51
8623C- - DMCC Street Use Study 3,117,708.00 2,885,881.60
8624C- - ChateauTheatreBldgImprov/Purch 66,152.78 8,303,247.02
8625C- - Heart of the City 153,597.10 11,648,940.00 2,488,358.14
8626C- - Sn/SUpsize1Av&3AvSE<4StS>1StN 1,185,874.19 8,500,000.00 6,718,174.66
8326 C - Reconst4thStSW<1stAve>6thAveSW 2,250,000.00
8628C- - Downtown Circulator Project 269,712.00
8702C- - RPTSolarPwrdBusFleetGrntApp 51,332.76
8703C- - FTA TOD Pilot PrgmGrntApplctn 26,057.97
8704C- - FTA Low-NoEmissions PrgGrntApl 1,140.11
8705C- - TransitCrcltr-FTAGrntBus&Faclt 19,258.02
8706C- - DMCTransitCirculatorTODPlnStdy 220,066.72 377,439.59
8708C- - Transit Villages 1&2 26,314.08 26,314.08
8804C- - TH 52 LID Bld GrantApplication 22,144.99
8901C- - TH 14/52 InterchangeBldGrntApp 36,330.84
8902C- - FestivalAreaStdy&ConceptDesign 84,133.27
8903C- - DedctdBikeLns-3rd/4thAve&CtrSt 23,096.63 256,043.08
Grand Total 1,783,266 51,167,298 41,769,620
* Notes: Broadway @ Center Parking Ramp Maximum DMCC Local Share Credit = $10,500,000
4th Street Reconstruction DMCC Support set at $2,250,000
22
Board of Directors
Destination Medical Center Corporation
Rochester, Minnesota
We have audited the financial statements of the governmental activities and the general fund of the
Destination Medical Center Corporation (the Corporation) for the year ended December 31, 2019, and
have issued our report thereon dated May 20, 2020. We have previously communicated to you
information about our responsibilities under auditing standards generally accepted in the United States
of America and Government Auditing Standards, as well as certain information related to the planned
scope and timing of our audit. Professional standards also require that we communicate to you the
following information related to our audit.
Significant audit findings
Qualitative aspects of accounting practices
Accounting policies
Management is responsible for the selection and use of appropriate accounting policies. The significant
accounting policies used by the Corporation are described in Note 1 to the financial statements.
No new accounting policies were adopted and the application of existing policies was not changed
during 2019.
We noted no transactions entered into by the Corporation during the year for which there is a lack of
authoritative guidance or consensus. All significant transactions have been recognized in the financial
statements in the proper period.
Accounting estimates
There were no accounting estimates affecting the financial statements which were particularly sensitive
or required substantial judgments by management.
Financial statement disclosures
Certain financial statement disclosures are particularly sensitive because of their significance to
financial statement users. There were no particularly sensitive financial statement disclosures.
The financial statement disclosures are neutral, consistent, and clear.
Difficulties encountered in performing the audit
We encountered no significant difficulties in dealing with management in performing and completing our
audit.
Uncorrected misstatements
Professional standards require us to accumulate all misstatements identified during the audit, other
than those that are clearly trivial, and communicate them to the appropriate level of management.
Management did not identify and we did not notify them of any uncorrected financial statement
misstatements.
23
Board of Directors
Destination Medical Center Corporation
Page 2
Corrected misstatements
Management did not identify and we did not notify them of any financial statement misstatements
detected as a result of audit procedures.
Disagreements with management
For purposes of this letter, a disagreement with management is a financial accounting, reporting, or
auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial
statements or the auditors’ report. No such disagreements arose during our audit.
Management representations
We have requested certain representations from management that are included in the management
representation letter dated May 20, 2020.
Management consultations with other independent accountants
In some cases, management may decide to consult with other accountants about auditing and
accounting matters, similar to obtaining a “second opinion” on certain situations. If a consultation
involves application of an accounting principle to the Corporation’s financial statements or a
determination of the type of auditors’ opinion that may be expressed on those statements, our
professional standards require the consulting accountant to check with us to determine that the
consultant has all the relevant facts. To our knowledge, there were no such consultations with other
accountants.
Significant issues discussed with management prior to engagement
We generally discuss a variety of matters, including the application of accounting principles and
auditing standards, with management each year prior to engagement as the Corporation’s auditors.
However, these discussions occurred in the normal course of our professional relationship and our
responses were not a condition to our engagement.
Other information in documents containing audited financial statements
Our auditors’ opinion, the audited financial statements, and the notes to financial statements should
only be used in their entirety. Inclusion of the audited financial statements in a document you prepare,
such as an annual report, should be done only with our prior approval and review of the document.
This communication is intended solely for the use of the board of directors and the management of the
Corporation and is not intended to be, and should not be, used by anyone other than these specified
parties.
CliftonLarsonAllen LLP
Rochester, Minnesota
May 20, 2020
24
DESTINATION MEDICAL CENTER CORPORATION
(A COMPONENT UNIT OF THE CITY OF
ROCHESTER, MINNESOTA)
FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2019
25
DESTINATION MEDICAL CENTER CORPORATION
ROCHESTER, MINNESOTA
TABLE OF CONTENTS
YEAR ENDED DECEMBER 31, 2019
INTRODUCTORY SECTION
BOARD OF DIRECTORS
SECTION I – FINANCIAL SECTION
INDEPENDENT AUDITORS’ REPORT 1
FINANCIAL STATEMENTS
STATEMENT OF NET POSITION AND GOVERNMENTAL FUND BALANCE
SHEET 3
STATEMENT OF ACTIVITIES AND GOVERNMENTAL FUND REVENUES,
EXPENDITURES, AND CHANGES IN FUND BALANCE 4
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND
BALANCE – BUDGET AND ACTUAL – GENERAL FUND 5
NOTES TO FINANCIAL STATEMENTS 6
SECTION II – COMPLIANCE LETTERS
INDEPENDENT AUDITORS’ REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS
BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN
ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS 12
INDEPENDENT AUDITORS’ REPORT ON MINNESOTA LEGAL COMPLIANCE 14
26
27
DESTINATION MEDICAL CENTER CORPORATION
ROCHESTER, MINNESOTA
BOARD OF DIRECTORS
AS OF DECEMBER 31, 2019
BOARD OF DIRECTORS
R.T. Rybak Chair
Kim Norton Vice Chair
Paul Williams Secretary
Jim Bier Treasurer
James Campbell Director
Michael Dougherty Director
Nick Campion Director
Pamela Wheelock Director
28
SECTION I – FINANCIAL SECTION
29
(1)
INDEPENDENT AUDITORS’ REPORT
Board of Directors
Destination Medical Center Corporation
Rochester, Minnesota
We have audited the accompanying financial statements of the governmental activities and the general
fund of the Destination Medical Center Corporation (the Corporation), a component unit of the City of
Rochester, Minnesota, as of and for the year ended December 31, 2019, and the related notes to the
financial statements, which collectively comprise the Corporation’s basic financial statements as listed
in the table of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes
the design, implementation, and maintenance of internal control relevant to the preparation and fair
presentation of financial statements that are free from material misstatement, whether due to fraud or
error.
Auditors’ Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We
conducted our audit in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial statements. The procedures selected depend on the auditors’ judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the
Corporation’s preparation and fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion
on the effectiveness of the Corporation’s internal control. Accordingly, we express no such opinion. An
audit also includes evaluating the appropriateness of accounting policies used and the reasonableness
of significant accounting estimates made by management, as well as evaluating the overall
presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinions.
30
Board of Directors
Destination Medical Center Corporation
(2)
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities and the general fund of the Corporation as of
December 31, 2019, and the respective changes in financial position and the budgetary comparison for
the general fund for the year then ended in accordance with accounting principles generally accepted in
the United States of America.
Other Matters
Required Supplementary Information
Management has omitted the Management’s Discussion and Analysis that accounting principles
generally accepted in the United States of America requires to be presented to supplement the basic
financial statements. Such missing information, although not a part of the basic financial statements, is
required by the Governmental Accounting Standards Board, who considers it to be an essential part of
financial reporting for placing the basic financial statements in an appropriate operational, economic, or
historical context. Our opinion on the basic financial statements is not affected by this missing
information.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated May 20,
2020, on our consideration of the Corporation’s internal control over financial reporting and on our tests
of its compliance with certain provisions of the laws, regulations, contracts and grant agreements and
other matters. The purpose of that report is solely to describe the scope of our testing of internal control
over financial reporting and compliance and the results of that testing, and not to provide an opinion on
the effectiveness of the Corporation’s internal control over financial reporting or on compliance. That
report is an integral part of an audit performed in accordance with Government Auditing Standards in
considering the Corporation’s internal control over financial reporting and compliance.
CliftonLarsonAllen LLP
Rochester, Minnesota
May 20, 2020
31
DESTINATION MEDICAL CENTER CORPORATION
ROCHESTER, MINNESOTA
STATEMENT OF NET POSITION AND GOVERNMENTAL FUND BALANCE SHEET
DECEMBER 31, 2019
See accompanying Notes to Financial Statements.
(3)
General Statement of
Fund Adjustments Net Position
ASSETS
Cash and Cash Equivalents 1,148$ -$ 1,148$
Advances to DMC EDA 50,000 - 50,000
Due from Other Governments 318,828 - 318,828
Prepaids 72,177 - 72,177
Total Assets 442,153$ - 442,153
LIABILITIES
Accounts Payable 318,976$ - 318,976
Due to Other Governments 51,000 - 51,000
Unearned Revenue 72,177 - 72,177
Total Liabilities 442,153 - 442,153
FUND BALANCE/NET POSITION
Fund Balance:
Unassigned - - -
Total Fund Balance - - -
Total Liabilities and Fund Balance 442,153$
Net Position:
Unrestricted - -
Total Net Position -$ -$
32
DESTINATION MEDICAL CENTER CORPORATION
ROCHESTER, MINNESOTA
STATEMENT OF ACTIVITIES AND GOVERNMENTAL FUND REVENUES,
EXPENDITURES, AND CHANGES IN FUND BALANCE
YEAR ENDED DECEMBER 31, 2019
See accompanying Notes to Financial Statements.
(4)
General Statement of
Fund Adjustments Activities
EXPENDITURES/EXPENSES
Economic Development:
Building Rent 34,017$ -$ 34,017$
Legal Consultants 146,785 - 146,785
Other Professional Services 14,668 - 14,668
Travel and Training 322 - 322
Insurance 13,607 - 13,607
Program Costs 2,491,338 - 2,491,338
Total Expenditures/Expenses 2,700,737 - 2,700,737
PROGRAM REVENUES
Intergovernmental:
Local Government 2,700,723 - 2,700,723
Total Program Revenues 2,700,723 - 2,700,723
Net Program Revenues (14) - (14)
GENERAL REVENUES
Investment Earnings 14 - 14
Total General Revenues 14 - 14
Change in Fund Balance - - -
Change in Net Position - - -
FUND BALANCE/NET POSITION
Beginning of Year - - -
End of Year -$ -$ -$
33
DESTINATION MEDICAL CENTER CORPORATION
ROCHESTER, MINNESOTA
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND
BALANCE – BUDGET AND ACTUAL – GENERAL FUND
YEAR ENDED DECEMBER 31, 2019
See accompanying Notes to Financial Statements.
(5)
Actual Over (Under)
Original Final Amounts Final Budget
REVENUES
Intergovernmental:
Local Government 2,897,606$ 2,897,606$ 2,700,723$ (196,883)$
Investment Earnings - - 14 14
Total Revenues 2,897,606 2,897,606 2,700,737 (196,869)
EXPENDITURES
Current:
Building Rent 35,000 35,000 34,017 (983)
Legal Consultants 225,000 225,000 146,785 (78,215)
Other Professional Services 41,200 41,200 14,668 (26,532)
Travel and Training 5,000 5,000 322 (4,678)
Insurance 20,000 20,000 13,607 (6,393)
Program Costs 2,571,406 2,571,406 2,491,338 (80,068)
Total Expenditures 2,897,606 2,897,606 2,700,737 (196,869)
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES -$ -$ - -$
FUND BALANCE
Beginning of Year -
End of Year -$
Budgeted Amounts
34
(This page intentionally left blank)
35
DESTINATION MEDICAL CENTER CORPORATION
ROCHESTER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2019
(6)
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Destination Medical Center Corporation (the Corporation) is a component unit of the
City of Rochester, Minnesota, and was incorporated on July 23, 2013. The Corporation was
established by the City of Rochester, Minnesota pursuant to Minnesota Statutes Section
469.41 as a Minnesota nonprofit corporation. The Corporation was established to benefit the
City, and more broadly, Olmsted County and the state of Minnesota by researching,
preparing, and implementing a master development plan, including facilitating public
infrastructure projects and a variety of development and redevelopment projects, all to
promote and provide for the establishment of the City, the County, and the State as a world
destination medical center.
The Corporation is governed by a board of directors consisting of eight directors. The
composition of the board of directors include the Mayor of the City of Rochester or the
Mayor’s designee, the City of Rochester Council President or the President’s designee, the
Chair or another member of the County Board of Olmsted County, a representative of Mayo
Clinic, and four directors appointed by the Governor of Minnesota.
Basis of Presentation
The financial statements of the Destination Medical Center Corporation have been prepared
in conformity with accounting principles generally accepted in the United States of America.
(GAAP) as applied to governmental units. The Governmental Accounting Standards Board
(GASB) is the accepted standard setting body for establishing governmental accounting and
financial reporting principles. The GASB pronouncements are recognized as generally
accepted accounting principles in the United States of America for state and local
governments.
Financial Reporting Entity
The Corporation was established to oversee the planning and implementation of the
Destination Medical Center initiative. The Corporation works with the City of Rochester,
Minnesota and the Destination Medical Center Economic Development Agency to prepare
and adopt a development plan.
Component units are legally separate entities for which the Corporation (primary
government) is financially accountable, or for which the exclusion of the component unit
would render the financial statements of the primary government misleading. The criteria
used to determine if the primary government is financially accountable for a component unit
include whether or not the primary government appoints the voting majority of the potential
component unit’s governing body, is able to impose its will on the potential component unit,
is in a relationship of financial benefit or burden with the potential component unit, or is
fiscally depended upon by the potential component unit.
Based on these criteria, there are no organizations considered to be component units of the
Corporation.
36
DESTINATION MEDICAL CENTER CORPORATION
ROCHESTER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2019
(7)
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Basic Financial Statement Presentation
The General Fund of the Destination Medical Center Corporation meets the definition of a
Special-Purpose government and is involved in only one program, as specified in Minnesota
Statutes, Sections 469.40 - 469.47. Accordingly, the Corporation is allowed to combine its
government-wide statements with the fund statements. At December 31, 2019, and for the
year then ended, there were no reconciling items between the two types of statements.
The government-wide financial statements (i.e. the statement of net position and the
statement of activities) display information about the reporting government as a whole.
These statements include all financial activities of the Corporation.
The statement of activities demonstrates the degree to which the direct expenses of a given
function or segment is offset by program revenues. Direct expenses are those that are
clearly identifiable with a specific function or segment. Program revenues include charges to
customers or applicants who purchase, use or directly benefit from goods, services or
privileges provided by a given function or segment and grants and contributions that are
restricted to meeting the operational or capital requirements of a particular function or
segment. Other items not properly included among program revenues are reported instead
as general revenues.
Measurement Focus and Basis of Accounting
The accounting and financial reporting treatment applied is determined by its measurement
focus and basis of accounting. The government-wide financial statements are reported
using the economic resources measurement focus and the accrual basis of accounting.
Revenues are recorded when earned and expenses are recorded when a liability is
incurred, regardless of the timing of the related cash flows. Grants and similar items are
recognized when all eligibility requirements imposed by the provider have been met.
Government fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Under this basis of
accounting, transactions are recorded in the following manner:
1. Revenue Recognition – Revenue is recognized when it becomes measurable and
available. “Measurable” means the amount of the transaction can be determined and
“available” means collectible within the current period or soon enough thereafter to be
used to pay liabilities of the current period. State revenue is recognized in the year to
which it applies according to Minnesota Statutes and U.S. generally accepted
accounting principles.
2. Recording of Expenditures – Expenditures are generally recorded when a liability is
incurred. However, expenditures are recorded as prepaid for approved disbursements or
liabilities incurred in advance of the year in which the item is to be used.
37
DESTINATION MEDICAL CENTER CORPORATION
ROCHESTER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2019
(8)
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Budgets and Budgetary Accounting
The Corporation adopts an annual budget, which is adopted on a basis consistent with
U.S. generally accepted accounting principles (GAAP). Reported budget amounts represent
the original adopted budget as amended by the board. For 2019, the amount budgeted for
the purpose of paying the expenses of the Corporation was $2,897,606. Actual expenditures
of the Corporation were $2,700,737 resulting in a favorable variance of $196,869.
Assets, Liabilities, and Fund Balance/Net Position
Cash and Cash Equivalents
Cash and cash equivalents consist of deposits in a checking account and a repurchase
agreement account for any available deposits at the end of the business day.
Advances
Advances consist of monies advanced to the Destination Medical Center Economic
Development Agency to fund operational expenses.
Due from Other Governments
Due from other governments consists of program costs receivable from the City of
Rochester, Minnesota.
Prepaids
Certain payments to vendors reflect costs applicable to future accounting periods and
are recorded as prepayments. Prepaid items are reported using the consumption
method and recorded as an expense or expenditure at the time of consumption.
Unearned Revenues
Unearned revenue is prepaid insurance and unspent dollars that were advanced to the
Destination Medical Center Economic Development Agency.
Fund Balance
In the fund financial statements, governmental funds report fund balances as
nonspendable, restricted, committed, assigned, or unassigned. The Corporation
currently only reports unassigned fund balance. Restricted fund balances are
constrained by outside parties (statute, grantors, bond agreements, etc.). Committed
fund balance represents constraints on spending that the Corporation imposes upon
itself by high-level formal action prior to the close of the fiscal period. The board of
directors authorizes all assigned fund balances and their intended uses. Unassigned
fund balances are considered remaining amounts.
38
DESTINATION MEDICAL CENTER CORPORATION
ROCHESTER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2019
(9)
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Fund Balance (Continued)
When an expenditure is incurred for which both restricted and unrestricted fund balance
is available, it is the Corporation’s policy to use restricted fund balance first, then
unrestricted fund balance. When an expenditure is incurred for purposes for which
committed, assigned and unassigned cash fund balance is available, it is the
Corporation’s policy to use committed first, then assigned and finally unassigned fund
balance.
Revenues
Intergovernmental revenues are reported under the legal and contractual requirements
of the individual programs. Generally, grant revenues are recognized when the
corresponding expenditures are incurred. The intergovernmental revenues are entirely
provided by the City of Rochester, Minnesota.
Investment income is recognized when earned, since it is measurable and available.
Expenditures
Expenditure recognition in the general fund includes only amounts represented by
current liabilities. Noncurrent liabilities are not recognized as governmental fund type
expenditures or fund liabilities.
Net Position
Net position represents the difference between assets and liabilities in the government-
wide financial statements. Net position is reported as restricted in the government-wide
financial statements when there are limitations imposed on their use through external
restrictions imposed by creditors, grantors, laws, or regulations of other governments.
NOTE 2 DEPOSITS AND INVESTMENTS
A. Deposits
In accordance with Minnesota Statutes, the Corporation maintains deposits at depository
banks as authorized by the Corporation’s board of directors.
Custodial Credit Risk – Custodial credit risk is the risk that in the event of a bank failure,
the Corporation’s deposits may not be returned in full. The Corporation’s deposit policy
for custodial credit risk follows Minnesota Statutes for deposits.
Minnesota Statutes require that all deposits be protected by insurance, surety bond, or
collateral. The market value of collateral pledged must equal 110% of the deposits not
covered by insurance or corporate surety bonds.
39
DESTINATION MEDICAL CENTER CORPORATION
ROCHESTER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2019
(10)
NOTE 2 DEPOSITS AND INVESTMENTS (CONTINUED)
A. Deposits (Continued)
The Corporation’s deposits in banks at December 31, 2019 were entirely covered by
federal depository insurance or by surety bonds and collateral in accordance with
Minnesota Statutes.
B. Investments
The Corporation may also invest idle funds as authorized by Minnesota Statutes as
follows:
Direct obligations or obligations guaranteed by the United States or its agencies.
Shares of investment companies registered under the Federal Investment Company
Act of 1940 and received the highest credit rating, is rated in one of the two highest
rating categories by a statistical rating agency, and all of the investments have a final
maturity of thirteen months or less.
General obligations rated “A” or better; revenue obligations rated “AA” or better.
General obligations of the Minnesota Housing Finance Agency rated “A” or better.
BANKER’S acceptances of United States banks eligible for purchase by the Federal
Reserve System.
Commercial paper issued by United States banks corporations or their Canadian
subsidiaries, of highest quality category by a least two nationally recognized rating
agencies, and maturing in 270 days or less.
Guaranteed investment contracts guaranteed by United States commercial banks or
domestic branches of foreign banks or United States insurance companies if similar
debt obligations of the issuer or the collateral pledged by the issuer is in the top two
rating categories.
Repurchase or reverse purchase agreement and securities lending agreements
financial institutions qualified as a “depository” by the government entity, with banks
that are members of the Federal Reserve System with capitalization exceeding
$10,000,000, a primary reporting dealer in U.S. government securities to the Federal
Reserve Bank of New York, or certain Minnesota securities broker-dealers.
The Corporation’s investments consisted of a repurchase agreement with Wells Fargo
Bank, N.A. having a balance of $1,148 at December 31, 2019. The securities sold to the
Corporation include US Agency Bonds with an AAA rating. The repurchase agreement
bears interest at .01% and matures overnight. As such, the repurchase agreement is
presented as a cash equivalent in the financial statements.
Interest Rate Risk – This is the risk that arises because potential purchasers of debt
securities will not agree to pay face value for those securities if interest rates
subsequently increase. The Corporation’s investment policy limits investments to a
maturity of one year, or lesser period that coincides with expected disbursements by the
Corporation. Operating reserves may be invested in securities with a maximum maturity
of up to three years.
40
DESTINATION MEDICAL CENTER CORPORATION
ROCHESTER, MINNESOTA
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2019
(11)
NOTE 2 DEPOSITS AND INVESTMENTS (CONTINUED)
B. Investments (Continued)
Custodial Credit Risk – Investments – For an investment, this is the risk that, in the
event of a failure by the counterparty, the Corporation will not be able to recover the
value of its investments or collateral securities that are in the possession of an outside
party. The Corporation follows state statutes which require that investment balances be
fully collateralized. As of December 31, 2019, the securities underlying the repurchase
agreement are held by the counterparty in the Corporation’s name.
At December 31, 2019, the Corporation had the following deposits and investments:
Repurchase Agreement - Wells Fargo Bank, N.A.1,148$
Total Cash and Investments 1,148$
NOTE 3 RISK MANAGEMENT
The Corporation is exposed to various risks of loss related to torts, theft of assets, or errors
and omissions. The Corporation purchases commercial insurance coverage for such risks.
There has been no significant reduction in insurance coverage from the previous year in any
of the Corporation’s policies. In addition, there have been no settlements in excess of the
Corporation’s insurance coverage in any of the prior three fiscal years.
NOTE 4 RELATED ORGANIZATION
The Destination Medical Center Economic Development Agency (DMC EDA), a related
Minnesota nonprofit corporation, was established by the Mayo Clinic pursuant to Minnesota
Statutes Section 469.43. The Corporation does not have a voting majority of the board of
directors of DMC EDA, which is considered a stand-alone entity apart from the Corporation
and thus, is excluded from the Corporation’s financial statements. Separate financial
statements are issued for the DMC EDA.
NOTE 5 CONTINGENT LIABILITIES AND COMMITMENTS
The Corporation receives financial assistance from state and local governmental agencies.
The disbursement of funds received under these programs generally require compliance
with the terms and conditions specified in the agreements and are subject to audit by the
funding agencies, regulators and other oversight agencies. Any disallowed claims resulting
from such audits could become a liability of the Corporation. Management is not aware of
any disallowed claims at this time.
41
SECTION II – COMPLIANCE LETTERS
42
(This page intentionally left blank)
43
(12)
INDEPENDENT AUDITORS’ REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS
BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Board of Directors
Destination Medical Center Corporation
Rochester, Minnesota
We have audited in accordance with the auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards
issued by the Comptroller General of the United States, the financial statements of the governmental
activities and the general fund of the Destination Medical Center Corporation (the Corporation), a
component unit of the City of Rochester, Minnesota, as of and for the year ended December 31, 2019,
and the related notes to the financial statements, which collectively comprise the Corporation’s basic
financial statements, and have issued our report thereon dated May 20, 2020.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the Corporation’s
internal control over financial reporting (internal control) to determine the audit procedures that are
appropriate in the circumstances for the purpose of expressing our opinions on the financial
statements, but not for the purpose of expressing an opinion on the effectiveness of the Corporation’s
internal control. Accordingly, we do not express an opinion on the effectiveness of the Corporation’s
internal control.
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to prevent, or
detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a
combination of deficiencies, in internal control, such that there is a reasonable possibility that a material
misstatement of the Corporation’s financial statements will not be prevented, or detected and corrected
on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal
control that is less severe than a material weakness, yet important enough to merit attention by those
charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this
section and was not designed to identify all deficiencies in internal control that might be material
weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any
deficiencies in internal control that we consider to be material weaknesses. However, material
weaknesses may exist that have not been identified.
44
Board of Directors
Destination Medical Center Corporation
(13)
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Corporation’s financial statements are
free from material misstatement, we performed tests of its compliance with certain provisions of laws,
regulations, contracts and grant agreements, noncompliance with which could have a direct and
material effect on the determination of financial statement amounts. However, providing an opinion on
compliance with those provisions was not an objective of our audit and, accordingly, we do not express
such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that
are required to be reported under Government Auditing Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and
compliance and the results of that testing, and not to provide an opinion on the effectiveness of the
Corporation’s internal control or on compliance. This report is an integral part of an audit performed in
accordance with Government Auditing Standards in considering the Corporation’s internal control and
compliance. Accordingly, this communication is not suitable for any other purpose.
CliftonLarsonAllen LLP
Rochester, Minnesota
May 20, 2020
45
(14)
INDEPENDENT AUDITORS’ REPORT ON MINNESOTA LEGAL COMPLIANCE
Board of Directors
Destination Medical Center Corporation
Rochester, Minnesota
We have audited, in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States, the financial statements of the governmental
activities and the general fund of the Destination Medical Center Corporation (the Corporation), as of
and for the year ended December 31, 2019, and the related notes to the financial statements, which
collectively comprise the Corporation’s basic financial statements, and have issued our report thereon
dated May 20, 2020.
In connection with our audit, nothing came to our attention that caused us to believe that the
Corporation failed to comply with the provisions of the deposits and investments, conflicts of interest,
public indebtedness, claims and disbursements, and miscellaneous provisions sections of the
Minnesota Legal Compliance Audit Guide for Other Political Subdivisions, promulgated by the State
Auditor pursuant to Minn. Stat. § 6.65, insofar as they relate to accounting matters. However, our audit
was not directed primarily toward obtaining knowledge of such noncompliance. Accordingly, had we
performed additional procedures, other matters may have come to our attention regarding the entity's
noncompliance with the above-referenced provisions, insofar as they relate to accounting matters.
The purpose of this report is solely to describe the scope of our testing of compliance relating to the
provisions of the Minnesota Legal Compliance Audit Guide for Other Political Subdivisions and the
results of that testing, and not to provide an opinion on compliance. Accordingly, this report is not
suitable for any other purpose.
CliftonLarsonAllen LLP
Rochester, Minnesota
May 20, 2020
46
DMC Metrics: WMBE Goals
To: DMC Corporation Board of Directors
From: DMC Economic Development Agency
Date: May 22, 2020
Request of the DMC Corp. board of directors:
Support the proposed new goals for women-owned and minority-owned workforce participation and
targeted business enterprises.
Background:
The table below outlines the current goals, those recommended by the state of MN, and proposed goals
based on the experience to date of DMC projects. Based on this current performance, it is the
recommendation of the DMC EDA, and the City of Rochester administration to support the adoption of
these workforce and targeted business recommendations. At a high level, a work plan is being
developed to support the pursuit of these goals and leverage the partnership and collaboration with
local, regional and state-wide agencies to realize these outcomes.
Targeted Workforce and
Business Categories
2015
Goal
Performance
(2017-2020)
MN Human
Rights Target
for SE MN
Goal for
2021
Goal for
2022
Goal for
2023
Women Construction
Participation 6% 3.6% 9% 7% 8% 9%
Women Professional
Services Participation 6% 32.8% 9% 7% 8% 9%
Minority Construction
Participation 4% 15.2% 15% 15% 15% 15%
Minority Professional
Services Participation 4% 6.5% 15% 15% 15% 15%
Targeted Business:
Construction 4% 7.2% - 7% 7% 7%
Targeted Business:
Professional Services 4% 5.1% - 7% 7% 7%
Targeted Business: Heavy
Construction Projects 4% - - 4% 4% 4%
Proposed Goals
47
Fulfilling the DMC Vision, Mission, and/or Goals:
Create approximately 35,000-45,000 new jobs, with workforce development strategies that support that
growth
Develop strategies to attract new businesses to the market, including small business enterprise (SBE),
minority business enterprise (MBE) and women business enterprise (WBE) participation
The DMC Development Plan and 2020 DMC EDA work plan support the focus and delivery of programs
to support women and minority owned workforce and targeted business enterprise targets.
Work plan or capital improvement budget implications:
There are no additional work plan or budget implications for 2020. In fall 2020 there will likely be an
operating budget to be considered in support of the 2021 WMBE work plan.
Approvals, milestones, and decision points:
February 2020
WMBE Update
Provided to DMCC
May 2020
Proposed WMBE
Targets and
Workplan
Introduced
Summer 2020
City Council
Consideration
48
COVID-19 ORGANIZATIONAL RESPONSES
To: DMC Corporation Board of Directors
From: DMC Economic Development Agency
Date: May 22, 2020
Request of the DMC Corp. board of directors:
· Endorse direction provided by the DMC Corp. board executive committee:
o Accelerate job creation
o Keep our foot on the gas as it relates to DMC’s core work of business development, marketing,
strategic relationships and investor/developer recruitment
o Support economic recovery and resilience
· Consider COVID-19 response and mitigation strategies being developed by DMC, the City of
Rochester, Olmsted County, Mayo Clinic, and other community partners
· Discuss ongoing and proposed DMC COVID-19 response strategies
o DMC’s Road to Recovery Webinar series: 1,221 attendees from throughout Minnesota
o Virtual community engagement efforts, including Transportation open houses, Heart of the City
small business weekly virtual meetings and construction newsletter
o Keep It Local grant programs: $100,000 awarded to 64 local businesses
o New communications highlighting recovery and resilience, including the “Business Pivot” series
o Development of new partnerships, including Medical Alley and Rochester Economic Stability
Team
o Business development and recruitment
· Support 2020 CIP public infrastructure adjustments to facilitate a safe and resilient DMC district
Background:
The DMC EDA is continuing to assess and respond assessing how our work is and will be impacted by the
global COVID-19 crisis:
· Current environment and key assumptions
o Economic recovery will be measured in months and/or years
o The pandemic has affirmed Rochester’s and Mayo Clinic’s position as the global center for
health care and research
o Local, state, and federal stimulus could provide jobs and infrastructure investment
o DMC efforts should focus on economic recovery and resilience and complement community,
regional, state and federal responses
o DMC should do what it can to blunt the harsh effects of this economic crisis and ensure that
our economy is in the best possible position when it subsides
49
· DMC EDA operations and work plan
o Operations
§ Staff safety
§ Cost reductions and budget management
o Work Plan
§ Reprioritize based on key assumptions, DMCC direction, and available resources
§ Assess and redeploy operating and capital project budgets
§ Develop strategies to fulfill work plan and encourage economic recovery/resiliency
Fulfilling the DMC Vision, Mission, and/or Goals:
DMC COVID-19 recovery and resiliency strategies will aid in DMC investment, development, and
workforce retention and growth by creating a safe environment that encourages public confidence and
trust.
Work plan or capital improvement budget implications:
In addition to committing staff hours to pursuing pandemic recovery and resiliency goals, the DMC EDA
has reallocated portions of its annual operating budget to align with direction from the DMCC Executive
Committee:
· $50,000 to sustain local small business innovation and develop safe and proactive economic and
business development strategies via the including the “Keep It Local” grant program
· Marketing and communications support for the DMC Road to Recovery Webinar Series and the
Reopen Rochester initiative
· Marketing support for the “Business Pivot” communication series.
· Revised Business Forward strategy associated with Heart of the City project reflect changes to
the business environment caused by Covid-19.
Funding to support these new programs was reallocated, in most cases, from budgets intended for
travel, conferences, and other expenses not likely to be incurred in 2020.
Also, the DMC EDA recommends that the DMC Corporation board of directors consider allocating
resources to develop safe and resilient public infrastructure that will provide for the resumption of DMC
district commercial activity and employment.
Approvals, milestones, and decision points:
March 2020
DMCC Exec.
Committee issues
direction
April 2020
DMC Road to
Recovery Webinar
Series, Business
Pivot, and Keep It
Local Grant
May 2020
DMCC
Consideration of
recovery and
resiliency public
infrastructure
support
August 2020
DMCC board update
50
2021 DMCC Funding Request:
Priorities, Process and Timeline
To: DMC Corporation Board of Directors
From: DMC Economic Development Agency
Date: May 22, 2020
Request of the DMC Corp. board of directors:
· Endorse the 2021 proposed priorities
· Affirm the suggested process and timeline to complete the 2021 funding request
Background:
2021 Priorities
Based on board work sessions, recent market studies, and changes in market conditions, DMC EDA staff
have developed the following set of priorities to guide the 2021 funding request process:
1. Transportation
2. Common Ground
3. Housing
4. Workforce
5. Transformative Projects
6. Sustainability
7. COVID-19 Recovery and Resiliency
Additionally, the DMC EDA and City of Rochester DMC project management staff will incorporate
significant business development, marketing, experience, and community engagement initiatives into
the 2021 workplan in order to support these strategic priorities.
Process and Timeline
The following general timeline for the creation and approval of the DMC Funding Request has been
established:
1. May: DMCC and DMC EDA staff begin preparing funding request
2. June-July: City, DMCC and DMC EDA staff draft preliminary request
3. July: DMCC and DMC EDA directors advise staff
4. Early August: DMC EDA board considers funding request
5. Late August: DMCC board considers funding request
6. September: City Council considers funding request
DMC Development Plan Goals
1. Create a comprehensive strategic plan with a compelling vision that harnesses the energy and
creativity of the entire community
2. Leverage the public investment to attract more than $5 billion in private investment to Rochester
and the region
51
3. Create 30,000+ new jobs, with workforce development strategies that support that growth
4. Generate approximately $7.5 - $8.0 billion in new net tax revenue over 35 years
5. Achieve the highest quality patient, companion, visitor, employee, and resident experience, now
and in the future
The nonprofit agency must provide services to assist the corporation and city in implementing the goals,
objectives, and strategies in the development plan including, but not limited to:
1. facilitating private investment through development of a comprehensive marketing program to
global interests;
2. developing and updating the criteria for evaluating and underwriting development proposals;
3. drafting and implementing the development plan, including soliciting and evaluating proposals for
development and evaluating and making recommendations to the authority and the city regarding
those proposals;
4. providing transactional services in connection with approved projects;
5. developing patient, visitor, and community outreach programs for a destination medical center
development district;
6. working with the corporation to acquire and facilitate the sale, lease, or other transactions
involving land and real property;
7. seeking financial support for the corporation, the city, and a project;
8. 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;
9. supporting and administering the planning and development activities required to implement the
development plan;
10. preparing and supporting the marketing and promotion of the medical center development district;
11. preparing and implementing a program for community and public relations in support of the
medical center development district;
12. assisting the corporation or city and others in applications for federal grants, tax credits, and other
sources of funding to aid both private and public development; and
13. making other general advisory recommendations to the corporation and the city, as requested.
Fulfilling the DMC Vision, Mission, and/or Goals:
The DMC Corporation must annually submit a request for operating and capital project funding to the
City of Rochester. The funding request, which includes funding for DMC EDA operations, is drafted by
DMCC board members, DMC EDA board and staff members, and City staff.
The operating budget request includes the following items:
1. Capital Improvement Program (CIP)
2. DMCC Operating Budget
3. DMC EDA Workplan and Operating Budget
4. City of Rochester Staff (who are supported by DMC funding) Workplan and Operating Budget
5. Working Capital Loan
Approvals, milestones, and decision points:
May 2020
Endorse 2021 DMC priorities &
affirm process and timeline
August 2020
DMCC board considers 2021
funding request
November 2020
Funding request update after City
Council provides action
52
Development Plan Five Year Update
To: DMC Corporation Board of Directors
From: DMC Economic Development Agency
Date: May 22, 2020
Request of the DMC Corp. board of directors:
· Discuss the five-year update to the DMC development plan:
o Timing and Process
o Plan Elements:
§ Context
§ Vision and Overview
§ Phase 1 (2015-2019) Benchmarking
§ Phase 2 (2020-2024) Projections
§ Mobility
§ Public Realm
§ Streets and Sewers
§ Private Development
§ Operating Model
§ CIP
Background:
The process to update the DMC Development Plan has been ongoing since July 2019. Since that time,
the DMC EDA has sought the input of regional economic development and planning partners and
reviewed previous reports, documents, and other works that have advanced DMC implementation since
2015.
The DMC EDA is currently preparing updates to ensure that the DMC development plan remains a
relevant, contemporary strategic framework for the implementation of the DMC initiative. It should be
noted, though, that several aspects of the DMC development plan may be impacted by the ongoing
pandemic-induced economic crisis:
· Private and public investment and development
· Key job sectors (construction, retail/dining/hospitality, etc.)
· Business development and recruitment
· Destination patient practice and telemedicine
· Transit system and public space design
· Forecasting availability and best uses of public and private DMC resources
The DMC EDA is preparing plan updates that sufficiently outline the “plan elements” described above
while also recognizing that as the economic crisis subsides, DMC priorities and strategies will need to
adapt to changes in economic conditions in order to achieve long-term DMC goals.
53
Fulfilling the DMC Mission, Vision, and/or Goals:
The Development Plan is meant to serve as a strategic business plan and framework to guide the
implementation of the DMC Initiative.
An updated DMC Development Plan supports all key DMC goals by tracking performance over Phase I
(2015-2019) and adjusting the implementation strategy for Phase II (2020-2024) to reflect the current
conditions in Rochester, Olmsted County and Minnesota in order to achieve the 20-year vision for DMC.
Work plan or capital improvement budget implications:
There is an approved work plan and CIP budget item for this ongoing work. The plan update is expected
to be completed under budget.
Approvals, milestones, and decision points:
July 2019
Review of
planning
documents
and group
interviews with
stakeholders
September
2019
2020 CIP
Approval
May 2020
DMCC board
discussion of
plan process
and timing
August 2020
Presentation
of updated
Development
Plan; send to
City Council
November
2020
Acceptance of
Development
Plan Update by
DMCC and City
54
Discovery Square
To: DMC Corporation Board of Directors
From: DMC Economic Development Agency
Date: May 22, 2020
Request of the DMC Corp. board of directors:
·Continue advancing Discovery Walk development.
·Affirm direction of start-up program development with Medical Alley and others.
Background:
·Economic Development Activities
o Continue business development and recruitment activities to pitch Discovery Square as a
landing place for technology companies as the opportunities arise.
o Medical Alley has been working with DMC and others to develop a start-up initiative program
in Rochester.
·Discovery Walk
o Design Documentation work continues with Coen + Partners, DMC and City staff.
o Using model developed by the steering committee for the Community For Health, under-
represented communities have actively participated in a co-design process.
o Next steps - Make final scope-related decisions on, district energy system, and climate
accommodation systems.
o Aiming for 2020 year-end construction bidding and groundbreaking in 2021.
·Discovery Square 2
o Mortenson working aggressively to advance DS2 with an anticipated groundbreaking in 2020
o Development Assistance Agreement and establishment of TIF District approved on April 20th
o Seeking parking solution, working with various stakeholders.
o Discussions underway with potential tenants.
·One Discovery Square
o 90% leased, some of the remaining space being fitted out as turn-key space.
·Entrepreneurship activities
o DMC part of the SE Minnesota Entrepreneurship grant award from Launch MN initiative.
o The DMC Assistive Tech Challenge moving online, scheduled for June 2, 2020.
·Discovery Square residential and retail activities
o The Maven now leasing - residential and retail space.
o The Residence Discovery Square now leasing - residential and retail space.
o The Hue (formerly “324 Apartments”) under construction, Minnwest Bank first retail tenant.
55
Fulfilling the DMC Mission, Vision, and/or Goals:
Discovery Square is a new address for the future of bio-medical, research and technology innovation and
a keystone to the DMC economic development strategy. The sub-district borrows from Mayo Clinic’s
integrated care model to create an integrated district founded in the principles of translational
medicine.
Technology and innovation are core to the DMC economic strategy. Our vision is to promote an
economic development structure that fosters advancement and growth of the medical, research,
innovation, education, entrepreneurial and general business environment in Rochester.
By attracting new businesses, supporting the launch and development of new startup businesses, and
creating new public realm space, we aim to diversify the local economy, create jobs, generate new tax
revenue, and create a place that fosters a vibrant community and attracts the workforce of the future.
Work plan or capital improvement budget implications:
The current DMC work plan describes a variety of initiatives supported by DMC 2020 operating and CIP
funds, including the design documentation of Discovery Walk.
Approvals, milestones, and decision points:
v
November 2017
One Discovery
Square ground-
breaking
October 2019
Discovery Walk
CIP approved for
Design
Documentation
February 2020
Discovery
Square 2
approved
May 2020
Discovery
Square Update
2020/2021
Discovery Walk
RFP approval
56
Heart of the City
To: DMC Corporation Board of Directors
From: DMC Economic Development Agency
Date: May 22, 2020
Request of the DMC Corp. board of directors:
· Authorize additional CIP funds for the Heart of the City Project
(More information can be found on the next memo)
· Support and provide guidance as the various projects below continue to make progress within the
Heart of the City subdistrict
Background:
2020 Peace Plaza Construction
Restoration of its public space, Peace Plaza and the adjacent street, has been in the planning stage for
several years. It is a transformative common ground project that includes improved safety, accessibility,
universal design elements, sustainability, integrated art, and improved infrastructure to enhance the
overall user experience.
Work started on the Heart of the City Phase One Construction on April 6, 2020. Prior to construction
beginning a hyper-local focus strategy to reach potential local and regional sub-contractors was put into
place. 40% of the bid packages were awarded from the city of Rochester and 92% were from the state of
Minnesota. Original bids, including construction procedures designed to minimize disruption to existing
businesses, came in well in excess of the original project budget. Subsequently, bid documents were
rewritten and the project rebid with certain components treated as optional additional alternates
pending review of all bids.
The Rochester City Council approved the authorization to execute all contracts for the rest of the
bidding packages on April 20, 2020. The City Council also authorized the inclusion of the add alternative
for a snow melt system, conditional of the DMCC board approval on additional CIP funding. More
information can be found in the following 2020 Capital Improvement Program (CIP): Reallocation of
Funds memo.
Business Forward Construction
DMC EDA and other partners have been working with Heart of the City property owners, business
operators, and community stakeholders to design a construction process intended to minimize negative
impact on nearby businesses through improved construction communications, scheduling, and pace.
As previously shared, there is a cost premium associated with implementing a “business forward”
approach of approximately 8% of project costs. These additional expenses have been absorbed in the
overall project costs listed above.
Business Forward is a construction strategy that focuses on encouraging pedestrian traffic and
supporting the local businesses. It is a priority for the project team and extremely important for the
vitality of Heart of the City during the disruption. While preparing for construction, the project team met
57
with the businesses and landowners in the area to understand their needs during construction. The
information gathered from many stakeholders, including the Rochester Downtown Alliance and
Rochester Chamber of Commerce, informed the Business Forward Strategy.
Business Forward principles include:
· Access, Safety and Smart Micro -Construction Phasing
· Communication
· Activation and Programming
These principles are being applied in ways that are mindful of the social-distancing and other safety
precautions necessary to avoid COVID-19 transmission.
Chateau Theatre
The Chateau Theatre is currently closed to the public. The operator, EDG, is abiding by the State’s stay-
in-place executive orders and evaluating potential programming opportunities once the facility can re-
open.
Fulfilling the DMC Vision, Mission, and/or Goals:
Heart of the City subdistrict is a long-standing priority for the DMC Corp. board. It is home to many
hotels, restaurants, entertainment venues, and medical facilities, many of which have been undergoing
reinvestment. Transformation of the public realm, Peace Plaza, will be an asset to the downtown core,
improve the patient, visitor and resident experience, and help spur future investment.
Work plan or capital improvement budget implications:
This project is funded via state GSIA funds generated through the DMC initiative, approved by both DMCC
and Rochester City Council.
Approvals, milestones, and decision points:
2016
Heart of City
redesign
commenced
2018
Schematic
design
approved,
CIP
authorized
2019
Construction
documents
completed
and bidding
initiated
2020
Contracts
awarded.
Request for
additional
spending.
2021
Anticipated
completion
58
2020 Capital Improvement Program (CIP): Reallocation of Funds
To: DMC Corporation Board of Directors
From: DMC Economic Development Agency
Date: May 22, 2020
Request of the DMC Corp. board of directors:
· Authorize additional CIP funds for the Heart of the City Project
· Authorize reallocation of CIP funds for the Broadway Sewer Diversion Project
Background:
Heart of the City Project- Snow Melt System
Authorize additional spending of $1,622,325 for the Heart of the City renovation project, which will cover
the cost of a snow melt system located under the roadway along First Ave. SW, and in the pedestrian
zones along First Ave. SW and the east side of Peace Plaza. Both DMC EDA and City Council are supportive
of this requested action.
Restoration of its public space, Peace Plaza and the adjacent street, has been in the planning stage for
several years. Original bids, including construction procedures designed to minimize disruption to
existing businesses, came in excess of the original project budget. Subsequently, bid documents were
rewritten and the project rebid with certain components treated as optional additional alternates
pending review of all bids. The snowmelt system was one of these alternatives.
The Rochester City Council unanimously approved the authorization to execute all contracts for the rest
of the bidding packages on April 20, 2020. The City Council also authorized the inclusion of the add
alternative for the snow melt system for both the sidewalk and roadway within the project conditional
of the DMCC board approval on additional CIP funding.
Broadway Project- 1st Street NW Sanitary Sewer Diversion project
Authorize the use of the $1.479 million of that $4 million programmed for the North Broadway project in
2020 to be used for the 1st Street NW Sanitary Sewer Diversion Project in 2020. The funding for the 1st
Street NW Sanitary Sewer Diversion Project is included in the Capital Improvement Plan for 2021. It is
being requested that Sanitary Sewer work be completed a year ahead of schedule.
This work would add additional needed-capacity and decrease the likelihood of sewer backups in
businesses and homes in the affected areas. This work, located from 1st Avenue NW to Broadway Avenue
North, would utilize funds intended for the delayed North Broadway work allocated for 2020. This change
in scheduling would not increase the overall cost of the North Broadway work, but would only change the
work schedule.
59
Fulfilling the DMC Vision, Mission, and/or Goals:
· Heart of the City is one of DMCC’s priority subdistricts; it is home to many of the downtown’s
hotels, restaurants, retail, entertainment venues, and Mayo Clinic programs.
· DMC provides the public financing necessary to build the public infrastructure and other projects
needed to support the DMC vision. This sewer relief project will divert flows from an existing
sanitary sewer trunk, which will increase additional capacity for growth within the DMC District.
Work plan or capital improvement budget implications:
· The Heart of the City Project is funded via state GSIA funds generated through the DMC initiative,
approved by both DMCC and Rochester City Council.
· The Broadway Sewer Diversion Project is funded via state GSIA funds (50%) and local funds (50%),
funds approved by both DMCC and Rochester City Council.
Approvals, milestones, and decision points:
September 2019
2020 CIP Authorized
May 2020
Request for
Reallocation of 2020
CIP Funds
60
D.
DESTINATION MEDICAL CENTER CORPORATION
RESOLUTION NO. ___-2020
Approving Amendments to the 2020 Five Year Capital Plan
BACKGROUND RECITALS
A. The Destination Medical Center Corporation (DMCC) Board approved the 2020
Five Year Capital Improvements Plan (the “2020 CIP”) on October 18, 2019 and approved the
projects set forth in the first year of the 2020 CIP 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. Final approval of each of the capital
projects is subject to a later specific approval by the DMCC upon final determination of scope,
costs and availability of funds. The 2020 CIP was subsequently approved by the City of Rochester
(the “City”).
B. The 2020 CIP provided funding for the Heart of the City design and construction
in the amount of $9,000,000 in 2020, and $6,000,000 in 2021. Initial earthwork and infrastructure
work are underway.
C. Staff from the City and the Destination Medical Center Economic Development
Agency (the” EDA”) now recommend that the DMCC Board approve a budget increase and give
final approval for a snowmelt system. The snowmelt system would be located under the roadway
on First Avenue SW, and in the pedestrian zones along First Avenue and the east side of Peace
Plaza (the “Snow Melt System”). The total amount of the budget increase in 2020 is $1,622,325.
D. In addition, the 2020 CIP provided funding for the reconstruction of North
Broadway Avenue (the “North Broadway Project”), starting in 2020 with funding of $4,000,000.
Staff has informed the DMCC Board that the North Broadway Project will be delayed by one year.
Staff now recommends proceeding with a different project involving sanitary sewer diversion
instead of the North Broadway Project.
E. The 2020 CIP included funding for the 1st Street NW Sanitary Sewer Diversion
from 1st Avenue NW to Broadway in the amount of $1,479,000 of DMC funds (and an additional
$1,479,000 in other City funds), to be performed in 2021 (the “1st Street NW Sanitary Sewer
Diversion”). Staff from the City and EDA recommend the work and funding for the 1st Street NW
Sanitary Sewer Diversion be accelerated by one year, to be performed in 2020. Funding for the
project will be transferred from the North Broadway Project, in the amount of $1,479,000. This
budget amendment would not increase the cost of the 1st Street NW Sanitary Sewer Diversion, but
would change the proposed schedule for completing it.
61
F. As set forth in Exhibit A, attached, staff from the City request that the DMCC
amend the 2020 CIP, to (1) approve the Snow Melt System and increase the total budget for the
Heart of the City project in 2020 by $1,622,325; (2) accelerate the funding for the 1st Street NW
Sanitary Sewer Diversion project to 2020, by transferring $1,479,00 from the North Broadway
Project; and (3) give final approval of both projects.
RESOLUTION
NOW THEREFORE, BE IT RESOLVED by the Destination Medical Center
Corporation Board of Directors, that the 2020 CIP is amended as follows:
(a) Heart of the City: the Snow Melt System is hereby approved as a public infrastructure
project within the meaning of Minnesota Statutes Section 469.40, Subdivision 11, and
consistent with the Development Plan; and the 2020 CIP is increased in the amount of
$1,622,325 for the design and construction of the Snow Melt System, such work to be
performed in 2020, as more fully described in Exhibit A.
(b) 1st Street NW Sanitary Sewer Diversion Project: the 1st Street NW Sanitary Sewer
Diversion Project is hereby approved as a public infrastructure project within the meaning
of Minnesota Statutes Section 469.40, Subdivision 11, and consistent with the
Development Plan; and the 2020 CIP is amended by accelerating the design and
construction of the 1st Street NW Sanitary Sewer Diversion, currently scheduled for 2021,
by transferring funds allocated for the North Broadway Avenue reconstruction, in the
amount of $1,479,000.
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 these amendments to the 2020 CIP.
1235929-10.DOCX
62
EXHIBIT A
To: DMCC Board of Directors
From: City of Rochester Team
Date: May 20, 2020
Subject: Budget Amendment
The City of Rochester provides the following documentation in support of the proposed budget
amendment to the 2020 adopted Capital Improvement Plan (CIP).
The 2020 CIP has $4 million of DMC funding programmed for the North Broadway
reconstruction project. The Rochester Common Council recently rejected the bids for the project
and will re-bid at a later date resulting in the project being delayed to 2021. The Common
Council supports the reallocation of the $4 million of DMC funds as recommended by the DMC
EDA.
On April 20, 2020 the Rochester Common Council awarded contracts for phase I of the Heart of
the City project (RCA attached). The awarded contracts fall within the current budget for the
project. An additional add alternates that did not fit within the current project budget, but are
considered important elements to the long-term longevity of the project, is the snow melt
system. The snow melt system ($1,622,325) would be located under the roadway in First Ave.
SW, and in the pedestrian zones along First Ave and the east side of Peace Plaza. These
systems minimize the need for labor-intensive snow removal, shoveling, and salting, which
helps maintain the quality of the pavers. There is also a safety component by reducing surface
ice and creating a more accessible walkable area in all four seasons. The Common Council
awarded the contract conditional on the DMCC Board approval of additional funding.
On May 18, 2020 the Rochester Common Council approved awarding the contract for the 1st
Street NW sanitary sewer diversion from 1st Avenue NW to Broadway Ave. North (RCA
attached). The project is shovel ready and will begin this summer. This sanitary sewer system
drains the DMC Development District - Central Station and has seen numerous development
projects recently and is reaching its capacity during wet weather events. This project is
identified in the CIP for the year 2021. The Common Council supports using $1.479 million of
the funding allocated to the North Broadway project in 2020 for the 1st Street NW sanitary sewer
diversion project with the $1.479 million allocated for the sewer project being reallocated to the
North Broadway project for the year 2021.
Upon DMCC approval, the Common Council will ratify the budget amendments as well.
63
64
Transportation
To: DMC Corporation Board of Directors
From: DMC Economic Development Agency
Date: May 22, 2020
Request of the DMC Corp. board of directors:
• While retaining prior approved Locally Preferred Alternative for the Rapid Transit route, adopt a
phased implementation strategy
• Initiate boundary modification process to adjust DMC Development District to include route and
transit village location for Phase I.
Background:
Following extensive, multiyear analysis, the DMCC and City of Rochester, with support from Olmsted
County, established a vision for a transit line connecting the Graham Park area with the downtown and
St. Marys areas and ultimately to Cascade Lake. This alignment provides connection to jobs,
entertainment, park space, housing, and parking infrastructure.
Furthermore, the DMCC and Rochester City Council directed staff to advance a grant application to the
Federal Transit Administration in its 2020 application cycle, the deadline for which is September 4, 2020.
A competitive application requires agreement on the transit functionality and land use for each of the
Transit Villages. As it relates to the East Transit Village (ETV), to be located on County owned properties,
City, County, and DMC representatives have been working for months to arrive at a mutually agreed
upon master site plan. All parties seem to share the goal that that the ETV includes efficient transit and
parking operations, mixed-use/mixed-income development, and consistency with the Graham Park
vision. However, the City and County have not been able to come to agreement on the site plan at this
time.
It is important that we take the time necessary to get to the right design solution for the East Transit
Village (ETV), measured by support from both the Rochester City Council and Olmsted County
Commissioners. Meeting these shared goals is not an easy task and should not be rushed.
With the objective of meeting the September submittal deadline, and while understanding more time
may be necessary to finalize the ETV design solution, the DMC EDA recommends advancing the Rapid
Transit vision in phases.
The first phase could consist of the Second Street corridor, connecting Cascade Lake to the Government
Center. This will achieve many of the goals for the Transit system, such as providing a much better
ridership experience, reducing pressure on downtown parking, providing better transit access to
residents of nearby neighborhoods, and reducing single occupancy vehicles on Second Street. Once
there is consensus around the details for the ETV we can work to advance the southward route.
65
Mission, Vision, and/or Goals:
The transportation element of the DMC Development Plan serves as a guiding investment strategy
based on sound market analysis and full integration with the 20-year DMC development program.
Work plan or capital improvement budget implications:
The 2020 DMC CIP includes $3.872 million for transit circulator development.
Approvals, milestones, and decision points:
v
February
2019
Transit hub
locations
approved
May 2019
Approval of
Locally
Preferred
Alternative
September
2019
Budget
Approval for
FTA
Application
May 2020
DMCC board
phasing and
boundary
modification
discussion
Augsut 2020
DMCC
review of
FTA
submission
66
E.
DESTINATION MEDICAL CENTER CORPORATION
RESOLUTION NO. ___-2020
Authorizing Submission of a Modification to the Development District to the City of
Rochester (West Transit Corridor)
BACKGROUND RECITALS
A. Pursuant to Resolutions Nos. 87-2019 and 89-2019, the Destination Medical
Center Corporation (“DMCC”) approved a locally preferred alternative (the “Locally Preferred
Alternative”) for route, alignment and mode for the downtown circulator and additional project
features, authorized expenditures, and approved application to the Federal Transit Administration
for federal funding. These resolutions also contemplated a modification of the development
district, the geographic area in the City of Rochester (the “City”) identified in the Development
Plan (adopted on April 23, 2015, as amended), in which public infrastructure projects are
implemented as the Destination Medical Center development district (the “Development
District”).
B. The City and the Destination Medical Center Economic Development Agency
(“EDA”) now request for a modification to the Development District, set forth in Exhibit A
attached (the “Proposed West Transit Corridor Development District Modification”), in order to
implement a phase of the Locally Preferred Alternative.
C. The DMCC may modify the Development Plan at any time, and must update the
Development Plan not less than every five years. Pursuant to Minnesota Statutes Section 469.43,
subdivision 4, a modification or update must be adopted by the DMCC upon the notice and after
the public hearing and findings required for the original adoption of the Development Plan,
including approval by the City.
D. The DMCC must hold a public hearing before modifying the Development Plan.
At least sixty days before the hearing, the DMCC must make copies of the proposed
modifications available to the public at the DMCC’s and City’s offices during normal business
hours, on the DMCC’s and City’s websites, and as otherwise determined by the DMCC. At least
ten days before the hearing, the DMCC must publish notice of the hearing in the official
newspaper of the City. The DMCC may modify the Development Plan upon its finding that the
elements of the statute have been satisfied, and upon approval of the modification by the City.
E. The City must act on the proposed modification to the Development Plan within
sixty days following its submission by the DMCC.
67
RESOLUTION
NOW THEREFORE, BE IT RESOLVED by the Destination Medical Center
Corporation Board of Directors that the Proposed West Transit Corridor Development District
Modification, dated as of May 28, 2020, and on file with the DMCC is hereby submitted to the
City of Rochester for its review and action within 60 days.
BE IT FURTHER RESOLVED that the DMCC Chair and Vice Chair are authorized:
(1) to make copies of the Proposed West Transit Corridor Development District
Modification available to the public at the DMCC and City offices during normal business hours,
on the DMCC’s website, on the City’s website, and as otherwise appropriate;
(2) to determine the date, time, and place to hold the public hearing for testimony from
the public concerning the Proposed West Transit Corridor Development District Modification;
and
(3) to take such actions as are necessary and appropriate to effectuate the submission of
the Proposed West Transit Corridor Development District Modification and the timely
progression of the approval process.
1235743-5.DOCX
68
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69
70
Sustainable Building Application Amendment
To: DMC Corporation Board of Directors
From: DMC Economic Development Agency
Date: May 22, 2020
Request of the DMC Corp. board of directors:
· Support the new energy standards in the Sustainable Building Guidance based on the Sustainable
Buildings 2030 targets.
Background:
The Sustainable Building Guidance, included in the DMC Application for Funding, will be updated with
the energy standard to reference Sustainable Buildings 2030, a state-supported energy target for new
construction. This change will increase the energy standard for building performance and increase its
threshold.
Previous sustainable building guidance included two energy standards, but they are no longer equivalent
as of 2020. The current increase in performance is attainable with current technology at little cost
impact to projects. In 2025 and 2030, when the standard continues to increase, adjustments may need
to occur based on technology changes and resultant costs to private development projects.
Fulfilling the DMC Vision, Mission, and/or Goals:
A Model for Sustainability - “The principles of sustainability planning are interwoven throughout the
Development Plan through an integrated mix of medium-to-high density uses, integrated live-work
environments and green/park space features throughout the downtown…”
The DMC Development plan includes several greenhouse gas and energy reduction targets for the district
by 2035. Ensuring new construction requesting DMC funds is built in an efficient manner, is critical to
realizing these goals at the end of the project.
Work plan or capital improvement budget implications:
There are no work plan or capital budget implications associated with this item.
Approvals, milestones, and decision points:
June 2018
Sustainable Building
Guidance Adopted
May 2020
Sustainable Building
Guidance Amended
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District Energy Updates
To: DMC Corporation Board of Directors
From: DMC Economic Development Agency
Date: May 22, 2020
Request of the DMC Corp. board of directors:
· Support completion of the two district energy analyses
· Provide guidance on additional information required for future board consideration
Background:
Downtown Waterfront District Energy System (DES):
In collaboration with Olmsted County and the City of Rochester, the DMC EDA evaluated a district
energy system in the Downtown Waterfront sub-district. Currently, several City and County government
facilities are served by the Olmsted County Waste to Energy Facility (OWEF), a steam-based district
energy system. The steam and condensate lines of the system need replacement and the cost to replace
these lines is estimated to cost approximately $30 million.
In April, the County Board elected to move in a direction of independent heating and cooling systems in
their facilities. The DMC and City of Rochester are currently re-evaluating the results summarized below
to only include City facilities. Based on the results of this analysis and its next steps, a capital budget
request may follow to support the City’s investment in a district energy system in the fall of 2020, where
the capital would facilitate the connection of private development to the system.
Discovery Walk DES:
In collaboration with Mayo Clinic, the DMC EDA is evaluating the possibility of a district energy system
(DES) in Discovery Square. This DES is meant to serve new development along or adjacent to Second Ave
southwest, the proposed future location of Discovery Walk. The study is being conducted in partnership
with Mayo Clinic as the DES could provide benefits to both private development and heating and cooling
needs of Mayo’s healthcare facilities.
The study’s next steps and corresponding schedule for decision-making are as follows. The project team
aims to answer the remaining study questions this spring and summer. Immediately following, the DMC
EDA will work with its partner Mayo Clinic to develop a recommendation for consideration, either to
move forward or not with this approach. Based on discussion with Mayo and financial priorities, a
decision may be brought forward for consideration by the DMCC in the fall of 2020. If an understanding
is reached with Mayo Clinic, the expectation is to bring the budget of this project to the DMCC for
approval as part of its 2021 Capital Improvement Plan and would be constructed at the same time as the
construction of Discovery Walk.
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Fulfilling the DMC Vision, Mission, and/or Goals:
A Model for Sustainability - “The principles of sustainability planning are interwoven throughout the
Development Plan through an integrated mix of medium-to-high density uses, integrated live-work
environments and green/park space features throughout the downtown…”
These project evaluations are included in the 2020 work plan. District energy systems could help support
the development of private projects in Rochester. Further, when paired with efficient and
environmentally friendly technologies, district energy systems can also support the realization of the
project’s sustainability targets related to energy and greenhouse gas reductions.
Work plan or capital improvement budget implications:
There are 2020 work plan and CIP budget funds allocated for this work. Depending on the final evaluations
and recommendations from project partners for both the Discovery Walk District Energy System and
Downtown Waterfront District Energy System, there might be corresponding capital budget requests
made for 2021.
Approvals, milestones, and decision points:
May 2020
Project Update
August 2020
Possible Capital
Budget Request
November 2020
Final CIP
Approval
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Destination Medical Center Economic Development Agency
&
City of Rochester DMC Project Management Team
2020 Workplan
Updated:
May 22, 2020
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Table of Contents
1. EXECUTIVE SUMMARY
2. CITY OF ROCHESTER DMC PROJECT MANAGEMENT RESPONSIBILITIES
3. DMC EDA STATUTORY ROLE AND RESPONSIBILITIES
4. WORKPLAN OUTCOMES TO ACHIEVE 2020 STRATEGIC PRIORITIES AND DMC GOALS
1. Executive Summary
In 2020, the Destination Medical Center (“DMC”) initiative will focus on pursuing the strategic priorities endorsed by the
Destination Medical Center Corporation Board of Directors and the City of Rochester Common Council in order to achieve the
goals of the DMC initiative.
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”) and City of Rochester DMC project management team
will continue to pursue the goals of the DMC initiative.
DMC GOALS
· Create a comprehensive strategic plan
· Leverage the public investment to attract more than $5 billion in private investment
· Create approximately 30,000 new jobs
· Generate up to $8.0 billion in new net tax revenue over 35 years
· Achieve the highest quality patient, companion, visitor, employee, and resident experience
2020 STRATEGIC PRIORITIES
· Transportation
· Common Ground
· Housing
· Workforce
· Transformative Projects
· Sustainability
Additionally, the DMC EDA and City of Rochester DMC project management staff have incorporated significant business
development, marketing, experience, and community engagement initiatives into the 2020 workplan in order to support these
strategic priorities. The workplan outlines the objectives and defines the resources necessary to advance the 2020 DMC
strategic priorities.
2. City of Rochester DMC Project Management Team Responsibilities
In January 2019, the Destination Medical Center Corporation approved a proposal to assign new and existing DMC-
related project management responsibilities to DMC-dedicated City of Rochester staff. The City of Rochester DMC
Project Management team supports the DMC initiative in these areas:
· WMBE and Targeted Business Outreach and Compliance
· Subdistrict development
· Transportation infrastructure and multi-modal transit
· Housing
· Experience
· Grant development
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3. 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:
· 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
· Seeking financial support for the DMCC, the City, and projects
· 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
· Supporting and administering the planning and development activities required to implement the development
plan
· Developing and updating the criteria for evaluating and underwriting development proposals
· Providing transactional services in connection with approved projects
· Working with the corporation to acquire and facilitate the sale, lease, or other transactions involving land and
real property
· 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
· Facilitating private investment through development of a comprehensive marketing program to global interests
· Developing patient, visitor, and community outreach programs
· Preparing and supporting the marketing and promotion of DMC
· Preparing and implementing a program for community and public relations
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4. Workplan To Achieve 2020 Strategic Priorities and DMC Goals
STRATEGIC PRIORITY: TRANSPORTATION
Create the integrated transportation infrastructure necessary to provide access to and through downtown
Rochester and encourage additional opportunity for development and investment.
2035 Goal Phase 2 (2025)
Goal 2020 Outcome
Reduce drive- alone
mode share to 50%
or less
Reduce drive-
alone mode share
to 58%
Create Integrated Transit Studies implementation monitoring system
Identify five Transit-Oriented Development sites and partners
Evaluate suitability of autonomous vehicles as a transit option
Advance development of transit line
Complete City Loop implementation and location plan
Promote additional mobility modes, including last-mile & micro-mobility
options
Establish long-term Arrive Rochester TMA governance strategy
Increase Arrive Rochester TMA business and individual participation
STRATEGIC PRIORITY: COMMON GROUND
Design and develop public spaces and amenities to incentivize additional private investment, create unique
experiences, and increase downtown density.
2035 Goal Phase 2 (2025) Goal 2020 Outcome
$5.6 billion of
private investment
$1 billion+ of new private
development underway
Facilitate/support Community and Education subdistrict
development efforts
Advance Saint Marys Place transit corridor
and pedestrian experience planning
Completion of Peace Plaza
renovation
Renovation of first phase of Heart of the City’s Peace Plaza
significantly underway
Heart of the City property owners report minimal business
disruption
Achieve highest
quality patient,
visitor, resident
experience
Discovery Walk construction
completed, activities take
place regularly,
New development is being
considered
Discovery Walk stakeholder group engaged and supportive
of activities and outcomes
Discovery Walk design and construction documents completed,
construction bids received
STRATEGIC PRIORITY: HOUSING
Contribute to a robust mix of housing infrastructure in the DMC District that creates density, sustains
additional commercial and entertainment activity, develops a greater sense of community, and provides for
our growing workforce.
2035 Goal Phase 2 (2025)
Goal 2020 Outcome Status
Show quantifiable
improvements in the
availability of housing in
DMC District - inclusive of
housing type and
affordability.
Will identify
metrics in 2019
housing study
Document progress towards identified housing goal from 2019
affordable housing study; include targets for affordable, senior and
student housing
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STRATEGIC PRIORITY: WORKFORCE
Contribute to our innovative workforce by supporting projects and programs that recruit and retain bio-
med-tech students, employees, employers, and entrepreneurs and encourages the sustainable growth of
our regional construction and building trades economy.
2035 Goal Phase 2 (2025) Goal 2020 Outcome Status
Create 30,000 new
jobs, including 3,230 in
bio-med-tech
100 interns placed annually in
bio-med- tech businesses, with
10% transitioning
into employment in Rochester
Students placed in Discovery Square businesses
Ensure compliance
with specific
requirements of the
DMC Act
Attain state MBE/WBE targets
for SE MN
Operationalize MBE/WBE
program for all DMC projects
STRATEGIC PRIORITY: TRANSFORMATIVE PROJECTS
Pursue high-impact, market-changing development opportunities that advance the DMC Goals and Mission
and maximally leverage DMC resources.
2035 Goal Phase 2 (2025) Goal 2020 Outcome Status
Develop 1.02M SF
new bio-med,
health tech space
Develop 330,000 SF of Bio-
Med-Tech space
Affordable Discovery Square startup
and bridge space available
Two Discovery Square design complete
and construction underway
$5.6 billion of private
investment
$1 billion+ of new private
development underway Advance Downtown Waterfront redevelopment
planning
Five new private
development
projects underway At least one new private development project underway
STRATEGIC PRIORITY: AMERICA’S CITY FOR HEALTH
Ensure that public infrastructure investment supports a more healthy community, citizenry, and built and
natural environments.
2035 Goal Phase 2 (2025) Goal 2020 Outcome Status
Show quantifiable
improvements in
community health measures
Apply health in design
process to 5
infrastructure projects
Apply replicable health in design process to
Discovery Walk
STRATEGIC PRIORITY: EXPERIENCE AND COMMUNITY ENGAGEMENT
Achieve the highest quality patient, visitor, and community member experience both now and in the future.
2035 Goal Phase 2 (2025) Goal 2020 Outcome Status
Achieve highest quality
patient, visitor, resident
experience
Will identify metrics in
proposed experience
master plan
Sustain and grow community support for
the DMC Development Plan
Create strategies, programs and services that support
a world class destination and enhance the experience
for patients, visitors and residents
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STRATEGIC PRIORITY: SUSTAINABILITY
Foster the culture, best practices, and development processes necessary to create a more healthy,
sustainable community that elevates Rochester as a market for investment, development, and workforce
recruitment and retention.
2035 Goal Phase 2 (2025) Goal 2020 Outcome Status
Reduce energy consumption by 25%
below 2012 levels by 2030
Benchmarking program
includes over 200
buildings. City Council
is reviewing an energy
disclosure
policy.
Benchmarking program includes 120
buildings
Reduce DMC-wide
emissions per SF by
22% below 2005
levels by 2025
Create key metrics collection schedule to
monitor progress towards DMC's
greenhouse gas, energy and
sustainability goals
Provide 12 sustainability series in 2020
and lead in management of Earthfest
celebration
Reduce:
· Energy consumption by 25%
below 2012 levels by 2030
· Potable water consumption
below 2012 levels by 2030
· Total waste generated by 30%
below 2012 levels by 2030
· Drive alone mode share to 50% or
less
· DMC-wide emissions per SF by 80%
below 2005 levels by 2050
Progress toward DMC
and Rochester GHG,
energy and
sustainability goals
across sectors
(commercial,
industrial, residential)
Engage in up to 3 national conferences
and 20 local and regional meetings to
learn sustainability and energy use best
practices
Reduce district-wide energy
consumption by 25% below 2010
levels by 2030
Reduce district-wide
energy consumption
by 20% below 2010
levels by 2025
Complete 9 projects identified in Phase
1 of Strategic Energy Project Plan and
evaluate— and if applicable, advance—
two district
energy possibilities in DMC District
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STRATEGIC PRIORITY: BUSINESS DEVELOPMENT AND MARKETING
Execute business development and marketing activity to secure private investment, recruit and retain new
businesses and entrepreneurs, develop our workforce, and achieve the goals of the DMC Development Plan.
2035 Goal Phase 2 (2025) Goal 2020 Outcome Status
Achieve highest quality
patient, visitor, resident
experience
Discovery Square organizations and their
staff are integrated into the Rochester
community
Comprehensive communications plan is
used to on-board and assimilate new
Discovery Square-based businesses
Create 30,000 new
jobs, including 3,230
in bio-med-tech
Assistive Technology Challenge (ATC)
enables formation of 10 new ATC-related
businesses, creating 25 new jobs towards
the 5-year goal of creating 510 Mayo and
non-Mayo new jobs in bio-
med-tech
ATC2.0 completed in spring; ATC3.0
initiated in fall
Programming supports the formation
of 20 new startup companies and 100+
new jobs, towards the 5-year goal of
creating 510 Mayo and non- Mayo
new jobs in bio-med-tech
Partner with other organizations to
support entrepreneurial programming
200+ new jobs created by recruiting 20
new bio- med-tech businesses into
Discovery Square, towards the 5-year
goal of creating 510 Mayo and
non-Mayo new jobs in bio-med-tech
New businesses operate in Discovery
Square
$5.6 billion of private
investment
More than $1 billion of new private
development, consistent with
development plan, underway
Drive qualified traffic to dmc.mn and
generate qualified leads by executing
an integrated marketing campaign to
targeted regional, national and
international
audiences
Secure two national media placements
and a minimum of one national
speaking engagement and showcase
the DMC model to a minimum of two
regional audiences by executing a
comprehensive communications plan
Five new development proposals
introduced and approved
Retail developments
active across all DMC
subdistricts
Retail strategy implemented throughout
DMC district and downtown Rochester
Retail strategy completion and initial
implementation
Ensure compliance with specific requirements of the DMC Act WMBE, Targeted Business Utilization,
Prevailing Wage, American-made Steel
LEGISLATIVE REQUIREMENTS
2035 Goal Phase 2 (2025) Goal 2020 Outcome Status
Ensure compliance with specific requirements of the DMC Act Update Development Plan
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I am pleased to provide you with the Destination Medical Center Economic Development Agency April 2020 Monthly
Report. This monthly report highlights projects and activities within the DMC District, economic development, finances,
sustainability, experience, marketing & communications, and community engagement.
-Lisa Clarke, Executive Director
April 2020
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Organizational Response toCOVID-19
April 2020 Updates
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Current environment and key assumptions
•Economic recovery will be measured in months and/or years
•The global pandemic has affirmed Rochester’s and Mayo Clinic’s position as the global center for health care and research
•Continued local, state, and federal stimulus programs could provide resources for jobs and public infrastructure investment
•DMC is an economic development initiative; our efforts should focus on economic recovery and resilience
•Proactive efforts by DMC complement community, regional, state and federal responses
•DMC should do what it can to blunt the harsh effects of this economic crisis and ensure that our economy is in the best possible position when it subsides
DMCC Executive Committee direction
•Accelerate job creation
•Keep our foot on the gas
•Support economic recovery and resilience
DMC EDA operations and work plan
•Operations
o Staff safety
o Cost reductions and budget management
•Work Plan
o Reprioritization based on key assumptions, direction from DMCC executive committee, and available staff and budget resources
o Assessment and redeployment of DMC EDA budget resources
o Development of new and innovative strategies and tactics to achieve work plan objectives and continue to establish DMC as a leader in
economic recovery and resiliency
Development Plan Five Year Update
•Progress in Phase 1 (2015-2019)
•DMC Phase 1 Priorities: Heart of the City, Discovery Square, Transportation
•DMC Goals
•Possible COVID-19 impacts on update to plan
Recent Activities Include:
•Participation in the Economic Stability Team
Focus Areas:
o Keep it Local, COVID-19 Innovators Grant Program. Two
rounds of applications resulted in $100,000 awarded to
54 small businesses.
o City of Rochester Small Business Disaster Loan Program
o Small Business Consultation Support
o Reduce the Cost of Doing Business
•DMC Hosted a Road to Recovery Webinar Series
o Construction Safety
o Office Environment
o Public and Private Transportation
o Travel, Lodging and Conventions
o Retail and Restaurants
o Outdoor Public and Event Spaces
•Stats: 1,221 attended over the course of the six webinars. 70% of
attendees were from outside of Rochester.84
'HYHORSPHQW3URMHFWs in the DMC District
1
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2
'HYHORSPHQW3URMHFWs in the DMC District
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Finance
Economic Development
•In response to COVID-19 the DMC EDA team has completed operational cost reductions and budget management. Workplan
prioritization and reallocation of resources are currently underway.
Sustainability
April 2020 Updates
3
•Berkman Apartments- Anticipated completion early summer 2020.
•Wells Fargo Renovation- Completed spring 2020.
•Hyatt House- Anticipated completion spring 2021.
•Discovery Square Two- Funding approved at February 6, 2020 DMCC Board Meeting.
•Titan Hilton Hotel- Completed spring 2019.
•The Maven on Broadway - Completed summer 2019.
•One Discovery Square- Completed summer 2019.
•Hotel Indigo- Hotel completed early 2020, restaurant under construction.
•The Transportation Locally Preferred Alternative (LPA) for the circulator was approved by the DMC Corp and City Council. This includes: Route, connecting a
future transit village at Mayo Clinic-owed property near Cascade Lake to a future transit village at Olmsted County-owned property. Mode, consisting of high
amenity rapid transit (electric bus vehicles). Staff is now beginning the engineering and environmental analyses and formalizing agreements with property owners
with the intent to submit a Federal Transit Administration grant application by September 4, 2020.
•Heart of the City phase one construction work started on April 6, 2020. Prior to construction beginning a hyper-local focus strategy to reach potential local and
regional subb-contractors was put into place. Rochester City Council authorized the inclusion of the add alternative for the snow melt system for both the sidewalk
and roadway within the project conditional of the DMC Corp. board approval on additional CIP funding. This action item will be brought to the May 2020 DMC
Corp. board meeting. DMC continues to lead a robust engagement strategy to minimize negative impact on nearby businesses.
•Discovery Walk continues to move forward with design documentation work with Coen+Partners, DMC and City staff. Community For Health initiative has been
meeting regularly with under-represented communities for a series of co-design activities intended to incorporate their needs into the Discovery Walk design.
•Chateau Theatre construction and installation of exhibits have been completed. Due to the COVID-19 pandemic the Chateau Theatre has been temporary closed.
DMC funded project updates:
•Energy Integration Committee (EIC) –The EIC continues to work on the projects identified in the strategic project plan including the
2nd year of the voluntary benchmarking program, an electric vehicle fleet analysis with partners, a large-scale solar installation led
by RPU and two district energy studies.
•Voluntary Energy Benchmarking - The DMC and City released a summary energy benchmarking report in February 2020 on the
inaugural program. In April, the second year of the program was launched in collaboration with Mayor Norton and other local
collaborators. The goal is to have twenty new facilities participate in the second year of the program with training sessions
scheduled in May 2020.
•Sustainability Series – DMC continues its monthly Sustainability Series. In April 2020, DMC hosted a presentation by Kevin Bright
focused on how to apply sustainable living principles while at home. For a crowd of 30 community members, this presentation
focused on ways community members could reduce their environmental impact at the their home.
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Traffic to DMC.MN:
•April traffic showed 9,546K visits and 11,506K pageviews.
•Top pages: DMC Road to Recovery Webinar, Home page, Events, Heart of the City, Maps
•Top 5 states: Minnesota, Virginia, Missouri, California, Illinois, Virginia
•Top 5 cities outside of Rochester: Saint Joseph, Chicago, Minneapolis, Richfield, Maple Grove
Social Media:
Marketing &
Communications
•Attended numerous educational webinars during the month of April provided by national and community organizations to
gain insight regarding COVID-19.
The Rochester, MN community, like others across the United States, are experiencing the impact of COVID-19. The DMC
EDA community engagement strategy will continue to evolve as needed.
•The “When in Rochester App” installed a link for users to access COVID-19 resources. Mayo Clinic is also promoting the App more
with patients as they travel to Rochester
•DMC is working with Mayo to understand new patient needs related to the community needs and COVID 19.
Community
Engagement
Experience
4
Newsletter:
April 2020 Updates
•Two newsletters were delivered to 3,257 subscribers in April. The average
open rate was 31.9% (industry average: 21.8%) and the average click rate
was 5.6% (industry average: 2.2%).
DMC Marketing Campaign:
•April Digital Display – Webinar Promotion
132,198 impressions; combined clicks: 205; combined average click
through rate of 0.20.
•April Paid Search (Google and Bing):
18,456 impressions; 773 clicks and average click through rate of 4.19%.
•Social media growth continued in April with gains on Facebook (+21), Twitter
(+25), LinkedIn (+102) and Instagram (+79).
Blogs:
•Six blogs were published in April.
Media News Stories:
•In April, 192 DMC-related stories were published in the media and 310 social
media mentions.
Highlights:
Restaurant industry leaders discuss road to recovery
COVID-19 Impacts: Restaurants and retailers reach customers in new ways
TV Chef offers advice about reopening to local restaurants
The new normal: 8 ways the corona virus is changing construction
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