ProMedica Health System Inc. wants incentives to include free use of part of Promenade Park to build a six-story parking garage, real-estate and income-tax abatements, and infrastructure improvements before it agrees to move its headquarters into a waterfront campus in downtown Toledo, according to a proposed memorandum of understanding Toledo City Council is expected to receive today.
Toledo Mayor D. Michael Collins said his administration and officials from the health-care company completed the tentative agreement on Monday.
“I believe everything in it is doable, and I think the return on investment will demonstrate it was a practical and solid business decision,” the mayor said. “This is a window of opportunity to dramatically change our city ... I understand there are some who are saying they do not want the green space compromised, but my response to that is a city with no treasury is a city that has no future.”
ProMedica announced a bold $40-million plan last year to renovate the century-old Toledo Edison Steam Plant and move up to 1,000 jobs downtown.
Renderings that officials for the hospital operator, one of Toledo’s largest employers, unveiled in November included a five or six-story garage in Promenade’s southwest quadrant — city-owned land that would have to be conveyed to the company as part of the deal.
According to the plan, a YMCA branch would be located on the first floor of the new headquarters.
The document says ProMedica intends to build “up to six above-ground levels” and one subterranean level with total space for about 750 vehicles.
The company wants the land at no cost, along with property north of the former steam plant that now is an amphitheater area south of the Imagination Station science museum. The company also wants the city to vacate the Water Street dead end north of Madison Avenue and an unbuilt stub of Madison east of Water.
The parking garage would be available for public use on weekends and nonbusiness hours for downtown events, according to the memorandum of agreement.
“The people in this [campus] will be coming and going to other facilities, we will have meetings and training, new employees may be coming, and we will have a lot of movement of visitors, so all that is important as we think about the location of the parking garage,” said Robin Whitney, ProMedica’s vice president of property acquisition and development.
Ms. Whitney said ProMedica would pay $20 million to construct the parking garage, with financing from the Toledo-Lucas County Port Authority being one possible option.
Conveying part of Promenade Park for a parking garage has been the proposal’s most controversial aspect. Councilman Steven Steel said he has not been shown good reason why ProMedica needs a new parking structure and believes existing downtown garages would be sufficient.
The city would retain the remainder of Promenade Park and be able to hold events at the site, Ms. Whitney said.
The company would spend $2 million to “restore and improve Promenade Park and the parking site,” according to the agreement. Of that, $1.5 million would be spent to restore the parkland disturbed by building the underground section, which would extend under the park. The remaining $500,000 would be used for improving the rest of the park.
The city would be obligated to add lighting, irrigation, and public restrooms in the park, under the agreement, while keeping it clean, sanitary, and safe with a “reasonable police presence.”
Also on the city’s task list would be moving a water main and improving a pedestrian tunnel, both beneath the park, and creating an improvement plan for Summit Street between Washington and Cherry streets.
ProMedica wants the city to enter into a “Toledo Expansion Incentive Program” agreement with it. Under that program, one-third of new income tax proceeds from jobs on the site would be rebated to ProMedica. Ms. Whitney said as many as 555 jobs could be new to Toledo.
Under a “Community Reinvestment Area Program” agreement, meanwhile, all property taxes there would be abated for seven years, Ms. Whitney said.
“Normally, ProMedica does not pay real estate taxes because we are nonprofit, but the [steam plant] may be in the name of a taxable entity for seven years to get the tax credits we need for the project,” she said. “If that is the case, there will be real estate tax and that is why we are asking the city to abate those taxes. Otherwise the tax-credit incentives wouldn't be worth it.”
Neither Ms. Whitney nor Mayor Collins provided an estimated value for the incentives or public improvements Monday.
Council President Paula Hicks-Hudson said she wanted to read the agreement before commenting about it, and still questioned how much of the bill taxpayers would end up footing with improvements and incentives.
ProMedica wants council to approve the memorandum of understanding this month, Ms. Whitney said. The company plans to start construction in late November and finish by early 2017.
Contact Ignazio Messina at: imessina@theblade.com or 419-724-6171 or on Twitter @IgnazioMessina.
First Published January 6, 2015, 5:00 a.m.
