Posted at: 02/14/2013 2:56 PM
Updated at: 02/14/2013 4:57 PM
By: Leslie Dyste
The Mayo Clinic's proposal for a publicly assisted expansion sailed through its first legislative committee Thursday, though backers were cautioned that the road ahead could get rough.
The famed clinic headquartered in Rochester is angling for more than $585 million in state and city subsidies to defray public infrastructure costs associated with a multibillion-dollar private expansion. The build-out would occur over the next two decades.
Mayo officials insist the money wouldn't directly feed construction at the clinic itself.
The House Jobs and Economic Development Committee approved the Mayo bill without delving deep into the tax components central to the deal. Both Republican and Democratic lawmakers heaped praise on the plan before the unanimous voice vote. At least a handful of committee stops lie ahead.
"We are competing on an international stage," said Rep. Mark Uglem, R-Champlain. "We have a huge, huge asset in our state and we need to protect that."
Mayo's vision is to make Rochester a destination city. Clinic officials said peer clinics in Cleveland, Baltimore and abroad are setting a torrid expansion pace, so Minnesota needs to move fast to keep up.
The plan relies on diverting future tax dollars to upgrade sewers, roads and other public assets to make room for growth at the anticipated Mayo expansion and spinoff businesses. Mayo would need to meet certain growth benchmarks to unlock the state dollars. A new public authority would be created to help manage the public side of the expansion.
Mayo representatives testified that the risk was largely on them, but lawmakers said they are mindful it could set a precedent.
"It opens a huge Pandora's Box," said Rep. Tim Mahoney, the committee's chairman. "If Rochester does it, why wouldn't St. Paul or Minneapolis?"
Mahoney made clear he supports the bill, but said he wants to see more "off-ramps" for state government to pull back if things don't go as planned.
Mahoney also said the Mayo proposal is likely to get lumped in to the broader tax debate at the Capitol, meaning some supporters of the project could have to vote for tax increases to get the Mayo tax breaks.
"You have a lot of work in front of you to get this thing through," he told the Mayo contingent.
(Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)