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After dismal 2022, Destination Medical Center retooling its Rochester pitch

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ROCHESTER — A decade into the $5.6 billion initiative that was to make Rochester a world-class medical destination, area marketers are finding that many of the types of companies they hoped to attract weren’t even aware of the city and its connection to Mayo Clinic.

“From a strategic sort of programming standpoint, we know we need to do things to get out and really raise the level of awareness in this community,” said Michael Flynn, director of economic development for Destination Medical Center (DMC), the initiative working to turn Rochester into an international medical hub.

Now, DMC officials are retooling their pitch to outsiders to persuade them to come to Minnesota’s third-largest city. Wednesday, they brought in more than 200 developers, bankers and consultants from the Twin Cities, Des Moines and elsewhere to sell them on Rochester’s growing opportunities.

The move comes as Mayo renewed interest in Rochester after threatening to pull $4 billion in investments in Minnesota out of the state as part of negotiations with lawmakers over a pair of health care workforce-related bills.

When DMC was formed in 2013, Mayo promised to invest $3.5 billion in Rochester over the next two decades, with another $2.1 billion coming from public and private investments.

So far, some $1.4 billion in economic development has been spent in Rochester since 2013, most of that from Mayo. And outside dollars have slowed considerably in recent years, in part due to economic conditions compounded by the COVID-19 pandemic, such as higher construction costs and interest rates on projects, construction labor shortages and other issues.

DMC officials recorded nearly $200 million in investments last year, including a record $173 million from Mayo. Yet private, non-Mayo investments only totaled $26 million — the lowest annual investment of private funds since 2015.

In a survey of 321 life science companies and site selection consultants DMC conducted in 2022, officials found most didn’t know much about Rochester — just 30% were aware of the city and its status as Mayo Clinic’s home.

Only 10% of the 168 life sciences companies surveyed were considering Rochester as a place to open office and lab space, even though most companies were actively looking for places throughout the U.S. to invest in.

“People are looking for [cities] where you have a lot of confidence in the future of the community,” said DMC Executive Director Patrick Seeb. “And Rochester checks a lot of those boxes.”

Seeb said he wasn’t surprised by DMC’s survey results. DMC officials usually pitch in one or two other markets each month, as well as host ongoing delegations from other cities — but that doesn’t mean everyone knows about Rochester.

He said the results helped DMC staff members sharpen their pitch and home in on what attracts companies, such as Rochester’s workforce, the city’s quality of life and opportunities to work with Mayo on research and future inventions.

“We have to tell them about the relationship to Mayo Clinic,” Seeb said. “We have to tell that story because otherwise, they simply don’t know about it and they’re hearing about a lot of other cities.”

DMC and city officials hoped to use Wednesday’s summit to pitch would-be developers on a variety of projects, from planned mixed-use housing west of downtown as part of a bus rapid transit line to be built within the next few years to a $300 million waterfront district along the Zumbro River that could bring in more than 500 housing units to the city.

Other community groups pitched ideas directly to developers. A coalition of minority organizations and businesses want to build an intercultural center that would also act as a food hub and business incubator. A nonprofit serving East Africa women wants to build a women’s shelter in the downtown area. And the Masjed Abubakr Al-Seddiq mosque wants to redevelop its downtown location into a mixed-use building for offices, condos and the mosque, as well as build housing and an Islamic center on 75 acres of land just north of Rochester that would serve a growing Muslim youth population.

“Our city has to provide for each family member,” Rashed Ferdous of the Islamic Resource Group said. “If it’s not fulfilling the need of one child, the family decides to relocate. So we lose talent.”

Developers and bankers in attendance said Rochester appears to be a growing, thriving city, which DMC emphasized with data compiled by the state Department of Employment and Economic Development that shows Rochester residents are on average younger, more educated, more diverse and with a higher labor force participation compared with Minnesota residents overall.

Developers also appreciate DMC’s $585 million in state funding to help cover public infrastructure costs that are often upfront barriers to projects.

Yet some attendees questioned city officials’ insistence on mixed-use buildings in future downtown plans, which historically haven’t paid off as well as strictly commercial or residential projects. Others questioned the city’s riverfront plans as they’ve heard from residents concerned about the Zumbro’s water quality.

Still, most developers in attendance said they were positive about Rochester’s future — as state officials project the city of more than 120,000 residents will gain another 35,000 people by 2045.

“I love the city’s vision,” said Joanne Kuria of Brooklyn Park-based Amani Construction. “The idea to revolutionize downtown and how much change has already happened really allows you to see the city is serious about development.”



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After defeat, supporters of St. Paul’s childcare payment plan not giving up

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In compiling a workable plan that shows a way to help families fill the gaps in state and federal aid for childcare, years of planning and advocacy paid off in greater visibility of low-income families’ struggles — and a possible way forward., Loewen said.

“The problem’s not going away, and neither are we,” he said. “We just have to determine what‘s next.”



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Minneapolis Park Board recommends closure of four outdoor rinks partially because of last year’s warm winter

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After only one week when people could skate on outdoor ice rinks during a record warm winter last year, Minneapolis wants to scale back its number of rinks.

In late October, the Minneapolis Park and Recreation Board recommended closing five outdoor rinks in its proposed 2025 budget due to climate change, increased supplies and materials needed due to inflation as well as fluctuating lake ice and warming house costs. The number of suggested rink closures has since been reduced to four, according to Park Board staff.

The rinks that are recommended to close this winter are in Webber, Windom and Powderhorn Parks. The Lyndale Farmstead Park rink will close in 2025-26.

“Powderhorn and Webber are both built on water bodies, and that makes it more challenging to open and maintain than rinks built on land due to changing ice thickness and quality,” said board spokeswoman Robin Smothers.

The decision to close the Windom and Lyndale Farmstead rinks are “based on proximity to other rinks and the challenges of constructing the various sites,” Smothers said.

The Matthews Park rink was originally recommended to be closed, but Smothers said the rink will stay open since the board would not want two rink closures in one district.

All of this is subject to change until the budget gets approved by the board on December 10. If all the proposed rinks close, it would bring the number of Minneapolis outdoor rinks from 22 to 18.

Joe Dziedzic, a former Minnesota Golden Gophers hockey player who went on to play professionally for the Pittsburgh Penguins and the Phoenix Coyotes, grew up near the Windom Park rink in northeast Minneapolis. He said it saddened him to see the city potentially discontinue the rink.



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Minneapolis Labor Standards Board plan gets mixed reception

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After years of speculation, Minneapolis City Council members have finally laid out their long-awaited Labor Standards Board proposal, which would bring workers and employers together to deliberate new regulations for industries with well-known problems, such as labor trafficking in construction.

Labor unions are pushing for it, and two years ago Mayor Jacob Frey and a majority of council members said they supported creating a Labor Standards Board. But the notion of creating a new layer of government, with workers having a role in regulations that impact business owners, has led to a wave of opposition from local and national industry groups.

Council members promised to pass the Labor Standards Board by the end of the year. At Wednesday’s public health committee, City Clerk Casey Carl, Council Vice President Aisha Chughtai and Council Members Aurin Chowdhury and Katie Cashman presented the structure of the panel for the first time.

Facing a phalanx of competing signs for and against the Labor Standards Board, they described the proposed board as being composed of an equal number of business owners, workers and other community stakeholders (such as consumer advocacy representatives), who would create sector-specific work groups as needed to discuss issues in specific industries and recommend policy solutions to the City Council, which would then go through its regular process of vetting new policies.

“The goal of this structure is to foster collaboration among stakeholders and creative solutions instead of one-size-fits-all policymaking,” said Chughtai. “It’s supposed to increase participation and engagement of those affected day to day by our workplace policies, and ultimately to allow for data informed policy recommendations to be considered by the City Council.”

Chowdhury said: “What this is about is trusting our local businesses, trusting our workers and trusting consumers and experts and saying, ‘Hey, we trust you, we believe that you’re the experts, you should have a table to come together on and have a robust discussion to inform us as policy makers. Most [businesses}, they aren’t acting in an egregious way that’s impacting their workers in a negative fashion, but we want to go and examine the sectors where workers are struggling, where labor standards that are needed are missing, to improve the workplace and in turn improve our economy.”

Earlier this year, national organizations that opposed raising wages for fast food workers in California conducted an ad blitz opposing the Minneapolis Labor Standards board. Since then, a growing number of business groups — the Minneapolis Restaurant Coalition, Hospitality Minnesota, the Minneapolis Regional Chamber, the Downtown Council and Minnesota Retailers — have also urged the council to abandon the board. Small business restaurateurs of color have been the most outspoken, saying they cannot withstand any new regulations after previous years’ passage of minimum wage and sick time ordinances, and do not want workers telling entrepreneurs how to run their businesses.

Speaking for business owners on Wednesday, Council Member Michael Rainville predicted the Labor Standards Board would pit small business owners against their employees. “This makes the city government become a union organizer,” he said. “This will do nothing to decrease the amount of empty storefronts in Uptown or downtown. The business community has made it clear that when their leases are up, they’re going to leave Minneapolis and or just simply close the business.”



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