Manager talks budget and debt
MARQUETTE — The city’s budget and debt were two topics Marquette City Manager Mike Angeli addressed at an event held by the Economic Club of Marquette County Monday evening at the Ramada Inn.
Angeli, who was the club’s guest speaker, told the crowd of over 100 that Marquette’s 2018 fiscal year budget is over $35 million less than its 2017 budget, which is mostly due to hospital and road construction costs, he said.
According to Angeli, the city is currently about $90 million in debt. Although the “actual number” is unclear, Angeli estimated it to be around $119 million including tax interest.
“About $30 (million) of that is related to the Duke LifePoint construction,” he said. “I’d like to take a minute and explain that because when that came about there was a lot of questions, a lot of concerns, a lot of accusations about who’s paying for the hospital, who’s paying for the debt that’s being accumulated. Well, we have a thing called the Brownfield Act in Michigan that allows us to, as an incentive, to capture the taxes produced by a developer. In this case it was Duke LifePoint. Duke LifePoint, by committing $30 million to this project, applied for a brownfield plan (that) allowed us to capture the taxes from that development.”
Part of the brownfield plan development includes the new hospital site at 850 W. Baraga Ave. that’s set to replace the current facility on College Avenue. The hospital’s new location, which has been under construction since May 2016, is the former site of Marquette’s Municipal Service Center that was rebuilt along Wright Street as part of the arrangement between DLP and the city.
The original brownfield plan states that DLP is responsible for environmental remediation, site preparation and infrastructure, and the city for road improvements and relocation of the Municipal Service Center. Those costs are reimbursed through the Marquette Brownfield Redevelopment Authority via tax-increment financing.
Angeli said city taxpayer dollars aren’t being used to pay for the construction, which has been a concern among the community since DLP proposed the idea of building a new hospital, he said.
“No city tax dollars are being used other than those generated by the hospital. There was some criticism early on that maybe some city taxpayer dollars were going to be used but that’s not the case,” he said.
Angeli also added that according to the agreement between DLP and the city, DLP would have to pay $20 million upfront if the for-profit organization sold the building or left the area.
The commission took a step further, Angeli noted, by creating a special tax assessment that would help collect the remaining $10 million, should the city need to.
“If (DLP) bail or leave or move on or sell the hospital, which I don’t believe they’re going to do, the community is fairly protected,” he said. “You’ll never convince me that … Duke was a mistake. I don’t think this community understands the impact this hospital is going to have on the city. The effects this hospital is going to have on the downtown is going to be significant,” he said.
Angeli added that aside from bringing business to the downtown district due to the hospital’s new central location, DLP also plans to buy all new medical equipment, which the city wouldn’t have been able to afford otherwise.
“I feel that (DLP) has nothing but good intentions for this community to do what they can to make sure they’re successful and we’re successful,” he said.
Don Ryan, host of The Ryan Report, asked Angeli if he knew what DLP planned to do with the “old hospital.”
“What I do know is that Duke LifePoint has hired an independent consultant to study that facility and market it for use. It’s a company that they’ve used before for similar situations,” Angeli said.
Although the city would like to see the site redeveloped as something useful, Angeli said DLP has not told the city what they’ve decided to do yet.
Jaymie Depew can be reached at 906-228-2500, ext. 206. Her email address is firstname.lastname@example.org.