The Destination Medical Center Economic Development Agency presented a new budget and work plan for the year ahead, with a significant cutback in spending and a tighter focus on objectives.
The economic development agency, which operates as a private nonprofit organization and reports to the Destination Medical Center Corp. Board, requested funding of $3.9 million in 2016.
The funding request is a step back from the previous iteration of the budget, presented in July, where the agency requested $4.6 million.
The largest piece of the EDA budget is directed to staff costs: $1.4 million. That figure includes $1,049,694 in payroll and benefits to the five-member EDA staff, as well as $330,000 in payroll and benefits — paid by Mayo — for two Mayo-contributed staff members who will coordinate with the EDA.
The remainder of the budget includes professional services, $1.3 million, economic development outreach and support, $495,000, operational costs, $270,000, and miscellaneous costs, $405,000.
Since the July meeting, the EDA board has polished its work plan, a document that details specific actions and objectives the agency will pursue. Fine tuning the work plan was a key step in refining the budget request, said Jeff Bolton, EDA Board chairman.
"The EDA was set up to be, and is and will continue to be, the foundational economic development engine that will drive DMC initiatives," Bolton said. "The EDA Board feels that sufficient funding for the EDA is crucial to underwrite the essential work of advancing the development plan into reality. "
Jim Campbell, a DMCC board member, has worked with the EDA as a subcommittee member and has challenged the agency staff and board to tighten its budget and objectives.
"Our objective is to attempt to really understand what it is you're trying to accomplish with these dollars. We want to make these dollars be as accountable and deliver as much return on the investment as we can," Campbell said.
Mayo Clinic has committed $915,000 in funding to the EDA to support the $3.9 million request. The city of Rochester is committed to fund the remaining $2.99 million.
A significant expense, $550,000, in the draft budget is targeted for marketing communications and advertising.
DMCC Board Member Bill George was happy to see the EDA taking an aggressive approach to marketing. Per state legislation, the EDA must attract private investments before public funding becomes available, George reminded the group.
"I think we've got to get out and market and we've got to close some of these deals so we can create this sense of momentum," he said.
The DMCC Board will make a decision on the EDA budget request at its September meeting.
Bolton encouraged the board to consider the budget more than just expenses.
"Personally, I look at the EDA budget as an investment as opposed to a pure expense budget," he said.
The updated EDA work plan shows the three priority areas set by the group earlier this year: Discovery Square, Heart of the City and transportation infrastructure.
Primary outcomes in 2016 include identifying and recruiting high priority partners for Discovery Square and facilitating desired private sector investment in Heart of the City.
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