Memorial Health’s desire to expand its current operations in Urbana took another step forward on Tuesday as City Council, following a public hearing, agreed to adopt an enterprise zone agreement, setting the stage for the construction during the second quarter of this year of a 30,000-square-foot medical ambulatory care building on the far east side of Urbana.
According to Champaign Economic Partnership Economic Development Director Marcia Bailey, the agreement – which involves the city, Urbana MOB (property owner) and Memorial Health of Union County (lessee) – will provide Urbana MOB with a 75 percent real estate tax abatement for 10 years on the property.
Located at the northwest corner of the North Dugan Road and East U.S. Route 36 intersection in the Urbana Commons Planned Unit Development (Walmart), the property is currently used for agricultural and is charged a half-year tax of $217.57.
“With anything that is being built on there, the 25 percent real estate taxes would still be paid on that new facility,” Bailey said. “I’m sure the taxes are going to increase from $217.57.”
As the planned lessee of the medical facility, Memorial Health has agreed to a job creation and retention provision as part of the enterprise zone agreement. The independent health system has pledged to retain the 16 full-time permanent positions at its Memorial Primary Care | Urbana office at 900 Scioto St., while creating 12 new full-time positions (additional $1.4 million in payroll) between 2018 and 2023.
Bailey added the 75 percent tax abatement can be recouped if the agreement falls through at any point.
“If for some reason either Urbana MOB does not commit and do the build as agreed to and/or Memorial Health does not hire as agreed to, then the real estate taxes have to be repaid,” she said.
Spence Fisher, executive vice president for Memorial Health, informed council the health system intends to bring forward the jobs outlined in the enterprise zone agreement, but it will probably take a few years to reach the 12 new positions.
“We are really excited about the opportunity here in Urbana,” he said. “This project really stemmed from making sure the practice (Memorial Primary Care) is sustainable and successful long term.
“The building itself will allow us to grow the practice. Right now, we are out of space in the current practice. We are planning for additional physician providers in the practice once we get into the new space,” Fisher added.
As for how Memorial Health’s new facility might affect Mercy Memorial Hospital’s role in the community, Fisher said, some of Memorial Health’s services will overlap those of Mercy’s, while some will be different.
“The practice is very supportive of the hospital here locally, so a lot of business (at Mercy) comes from referrals out of our practice, so they will continue to support the local hospital,” he added. “We are just adding some things around the edges that are important, I think, for the practice and its success long term.”
Council member Dwight Paul added he thinks Memorial Health’s decision to expand will be a benefit to the city and its residents.
“Competition is a good thing,” he said.
Resident weighs in on stormwater utility
Prior to council hearing the second reading of an ordinance seeking to establish Chapter 929 of the city’s codified ordinances, which would create a stormwater utility and establish a Stormwater Utility Review Committee, city residents were invited to speak on the issue during a public hearing.
Brian Wonn, who served on the Stormwater Advisory Council that recommended the utility fee be considered, was the lone resident to speak.
As currently laid out in the draft ordinance, the proposed measure would result in the city’s storm water system becoming a public utility funded as an enterprise fund similar to water and sewer.
To fund the utility, a $5 flat fee per month per meter would be added to all city utility bills, including city utility customers living outside city limits.
City Engineer Tyler Bumbalough said the advisory committee decided it wanted “no more than 30 percent of the generated revenue per year to go toward (storm sewer) operating (costs).
“They wanted at least 70 percent to go toward capital-type projects,” he added.
Wonn said while he agrees something needs to be done to address the storm sewer infrastructure, he has concerns over the funding method.
“The creation of a stormwater utility fee is in a sense really a tax,” he said. “It’s almost like you’re going around the community and holding your hand out to every resident, every month asking for another $5. For some people, it’s more impact than it is for others.”
He noted the Stormwater Advisory Committee decided against a tiered fee approach in which commercial and industrial properties would have been charged a higher rate than residential customers. He said he can’t justify the decision to go with a flat rate fee for everyone.
“It seems somewhat strange that we are asking the residents in a small house to pay the same as an industrial facility,” he said.
Wonn’s suggestion to council was to put the issue on the ballot to see if citizens would support making improvements to the storm sewer system through a small raise in the city’s income tax.
Council member Ray Piper agreed with Wonn.
“My thought is, I don’t like to make that kind of a decision for the public,” Piper said. “I would rather put it on the ballot and let the public vote on it.”
Other council members, however, said the storm water system is a critical infrastructure that needs to be addressed even if residents disagree with paying a stormwater utility fee.
“We are going to make some people unhappy, definitely,” council member Tony Pena said.
Council member Doug Hoffman said council was elected by the people to make the tough decisions and the storm sewer system currently “is going backwards.”
“I think $5 is easy. It makes sense, and it generates the right amount of money ($291,180 a year based on current meters),” he said. “I just think it’s a good business decision.”
As for the possibility of considering an income tax to improve stormwater infrastructure, Director of Administration Kerry Brugger said the revenue generated by the tax would be restricted as to how much could be used toward capital improvements versus operations.
“If you go with an income tax, it’s going to be 75 percent operations and 25 percent capital,” he said. “We are not asking for operating expense. I think three out of the next four (stormwater infrastructure) projects that have been identified are in the Fourth Ward. We’ve got projects that are on the shelf … we need capital. We are not looking for a slush fund to go get payroll.”
Council is expected to hear the third and final reading of the stormwater utility ordinance at its next meeting at 6 p.m. on Jan. 17 in municipal court chambers.
In other business:
•A 34,543-square-foot, triangular-shaped parcel on the north end of Urbana will be rezoned from R-2 Medium Density Residential District to M-1 Manufacturing District after council passed an ordinance approving the measure.
Community Development Manager Doug Crabill said the parcel in question, owned by J&J Champaign and located behind 207 Bloomfield Ave., is a “landlocked parcel” that has been used by the excavating business since the mid-90s for manufacturing-type use, but was never zoned M-1 like the other parcels on the property.
Crabill added the M-1 zoning district is the “best use for the property going forward,” and J&J Champaign is planning to sell the property as it has moved to a new location on East U.S. Route 36.
•Council decided to keep its meeting schedule the same as 2016 and meet at 6 p.m. on the first and third Tuesdays of the month in municipal court chambers.
•Paul was reappointed president pro tempore for 2017, and Amy Deere was reappointed to the position of council clerk.
•Council approved a purchase order in the amount of $43,000 to Smartbill for monthly utility bill printing, mailing and postage for 2017.