The Rochester City Council on Monday approved the release of local-option sales tax money to the University of Minnesota Rochester so the university can begin assembling and preparing sites for its future campus.
When Rochester residents voted in 2012 to extend the city's half-cent sales tax to raise $139.5 million for 10 projects, it included $14 million for the UMR campus to be built along South Broadway near the Rochester Area Family YMCA.
The city is releasing approximately $2.28 million of that $14 million for three projects involved in assembling sites for the campus. The university plans to carry out demolition and site preparation on the properties, but probably won't build on them for another five to six years, City Administrator Steve Kvenvold said.
The UMR is about to launch its master plan development process for the new campus, said Rochester Development Administrator Doug Knott.
The city will transfer to the university ownership of three parcels — at 601 and 609 First Ave. S.W. and 614 Sixth St., S.W. — which the city acquired during the last several years for the campus. One of the buildings is a former KTTC TV location and the other two are known as Sands Development and the Stillman Building. Combined, the transfer amounts to $1.32 million.
The city also is releasing $470,000 in sales tax money to the UMR to pay for demolition of a building at 724 First Ave. S.W. The university owns the property. It plans to issue requests for proposals for the work between March 14 and April 8.
In addition, the UMR owns two properties at 617 and 701 S. Broadway, where Tex-Mex and Chinese restaurants once stood.
"They acquired those and tore the buildings down, but left the slabs in place," Knott said.
The city will provide UMR with $496,000 to demolish the parking lots, rework the sites and create a temporary park with small trees and shrubs. Two billboards on the site will be removed, and a sign declaring the property the future home of the UMR will be added.
City Council President Randy Staver suggested Monday night that the sign also indicate that the properties are part of the city's $14 million sales tax project for the UMR campus. The other council members agreed with him.
Because the city doesn't have all of the sales tax money it needs to fund projects today, it is using money it has in other funds until the sales tax can replenish them.
"Primarily, we have tax abatement dollars that we have downtown, and we have a future construction account, money that's set aside in the Capital Improvement Plan for projects," Knott said.
He said the city also will be bonding to fund other sales tax projects until the money is collected.
UMR Chancellor Steven Lehmkuhle and Assistant Vice Chancellor Jay Hesley, who attended Monday's meeting, told the council that the university has acquired about 70 percent of the property it needs for its campus. Currently, the university is housed in the downtown University Square building at 111 S. Broadway.
UMR considers the YMCA a part of its campus because of its proximity and university students who pay a UMR services fee receive YMCA memberships.
Knott said the university is acquiring properties in the area as they become available.