The SMDC campus expansion plan finally has the necessary city approvals.
Thursday night, the City Council passed a list of resolutions to get the oft-delayed development started. And in what appears to be a move to defuse more controversy, the city will not buy land for the private hotel project.
The estimated $90 million expansion will change the face of the medical district and create at least 200 new jobs. St. Mary's/Duluth Clinic will have a new building for expanded medical services and a top-floor addition to the main hospital.
The city will build a new parking ramp and connect the campus to the skywalk. SMDC will also build a skywalk link from the addition to its clinic.
The extended-stay hotel is still expected to be built at Third Avenue East and Superior Street, and part of East First Street will be open to two-way traffic.
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Previously, the Duluth Economic Development Authority was going to buy the property for the hotel for about $450,000 and give the land to SMDC. The health system would then sell the land to an unnamed hotel developer.
But that action was taken off the agenda. City Administrator Mark Winson said SMDC will now acquire the property on its own, or have the hotel developer acquire it. "We feel the hotel needed to stand on its own," he said.
As approved, the project will obligate the city for about $26 million. Officials have stressed that the city's financial commitment will not involve any general fund money.
Both the Duluth Area Chamber of Commerce and the Greater Downtown Council urged the council to approve the package, as did the construction unions.
There were some concerns, however, over possible pending layoffs at SMDC. Cathy Warner, president of United Steel Workers Local 9460, said members at SMDC were concerned about rumored layoffs. She wanted assurance that there was no truth to this rumor before city approval.
Other speakers voiced similar concerns, and council members had heard the same rumors. Council President Rob Stenberg said Tom Klassen, chief operating officer at SMDC, tracked the rumors and found no plans for layoffs.
That led to a discussion on the project job agreement. Winson explained that creating the new campus will create a minimum of 200 new jobs at $25 an hour or more. Those jobs will be at the new site and not related to overall job gain or loss at the facility.
