County mulling options of support for Albert Lea Healthcare Coalition

Published 10:19 pm Tuesday, January 28, 2020

The Freeborn County Board of Commissioners on Tuesday directed county staff to begin looking at options for how the county can assist the Albert Lea Healthcare Coalition in its efforts to raise funds for the expected new clinic in the former Herberger’s building.

The coalition has proposed to either gift or sell the parking lot and sidewalks to the building for $1 to the county after the coalition purchases the property. The county would then be asked to repair the parking lot and sidewalks for an estimated $300,000, and the coalition would agree to make snow removal and general liability part of the lease agreement with the expected clinic provider, MercyOne.

Freeborn County Attorney David Walker said he would need to see more details about the business proposal before he could provide a basis for an opinion about the proposal. He said it was critical for the commissioners to evaluate whether it would be an authorized public expenditure and serve a public purpose. He asked if the county contributed funds if that would be a one-time agreement or if it would be part of a larger program for economic development that other businesses would be eligible for.

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Second District Commissioner Dan Belshan questioned whether there was funding through a revolving loan fund through the Minnesota Department of Employment and Economic Development or other state funding, where the cost would not need to be added onto the tax levy and the county would not have to spend taxpayer dollars for the project. The commissioners recalled a similar revolving loan being given through the county and DEED to SoyMor in 2006 and more recently to Mortarr through the city. Many of these types of loan funds hinge on the number of jobs created.

Brad Arends, president of the Albert Lea Healthcare Coalition, said the coalition is slated to close Feb. 7 on the former Herberger’s building, which is presently owned by the Carrington Co. This is being made possible through an Albert Lea High School graduate, who is gifting the coalition $1 million. Of those funds, $850,000 will be used for the purchase.

In addition, the coalition has raised $1.27 million in donations and pledges from 44 local businesses, $500,000 from local individuals and $30,000 from a local foundation. MercyOne has also committed $900,000 toward the buildout of the clinic and $1.1 million for furnishings and equipment, and has agreed to pay for two-thirds of the cost of the outpatient surgery center. MercyOne has contracted with an outside provider to pay for, build and operate a separate urgent care unit in the facility.

The project will be built in stages depending on patient loads and is targeted to open Oct. 1. At that time, there are projected to be 32 full-time employees. Paperwork provided to the county from the coalition said once the entire project is completed, the primary care clinic and outpatient surgery center will have between 85 to 100 full-time employees and generate over $800,000 of annual rental income to the coalition. The remaining 24,000 square feet of open space in the building is expected to be occupied with supporting businesses, generating additional annual rental income to the coalition.

Arends said coalition trustees plan to discuss a possible forgivable revolving loan with the city after the February closing date of the property. He said there was a delay in the closing date because of an easement with the mall owners.

Belshan said he thought the county commissioners and city councilors needed to have a meeting to talk about how to economically fund the project without raising levies.

Chairman Glen Mathiason said he has received more calls from people who don’t like the possibility of using taxpayer dollars for the project and would support another way that the county could contribute.

“It would be a good way to go about it if it’s possible,” Mathiason said.

County Administrator Tom Jensen said he would bring back more options at the county’s Feb. 3 meeting.