County, Utica reach tentative deal on downtown parking garage

Published Aug 22, 2017 at 4:00pm

There’s a tentative agreement for the city of Utica and Oneida County to fund construction of the parking garage for a planned downtown Utica hospital.

Sixty percent of the debt service would be paid by the county while the city would pick up the remaining 40 percent.

Mohawk Valley Health System, which is building the new hospital, will pay for the structure’s maintenance and operation.

It is projected that the county will borrow about $27.4 million to pay for the garage’s construction — with Utica reimbursing the county for the city’s share. 

Without the county-city financing for the garage, the hospital project cannot move forward, according to several people associated with the planned hospital.

The 60-40 agreement next has to be formalized by the city, county and MVHS. 

The garage’s total cost is in the neighborhood of $40.5 million.

The $13.1 million difference between the amount of money to be borrowed and the overall cost will be made up through grants and tax credits.

With a big lift provided by $300 million from the state, MVHS will fund construction of the facility, but not the parking structure.

The complex itself will cost about $480 million.

Should annual revenue generated by the 1,550-space garage exceed the cost of maintenance and operations, the overage would be divided 60-40 between the county and city, according to the funding plan.

Prior to Monday’s announcement that a deal had been struck, there had been back-and-forth discussions about how much the city was willing to pay.

Initial discussions included a 50-50 split between the county and city, but Utica officials balked at this ratio, asserting it presented too high a burden on the county’s largest city.

County legislators chewed on this issue in executive session for more than an hour Aug. 9 and informally agreed that the county could offer to pay 60 percent of the debt service.

“While this is a major investment for the city, we understand the economic potential the hospital brings and support the city financing 40 percent of the parking garage in order to move this transformational project forward,” said a statement released by Mayor Robert M. Palmieri and Comptroller William Morehouse.

By lowering the city’s share from 60 percent to 40 percent, Utica will save about $5 million over the life of the bonds, they said.

“While our support for a downtown hospital is steadfast, as leaders, it is vitally important we examine all aspects of this issue and strongly advocate for Utica’s best interests,” said the statement.

County Executive Anthony J. Picente Jr. said, “I am pleased the city has joined us. We have supported this project from the beginning. Now we can move forward and start the building process.”

He added, “The parking garage is an essential piece, but the hospital is the bigger picture.”

Mohawk Valley EDGE President Steven J. DiMeo was the point man for bringing the garage’s financing proposal to the city and county.

“It’s good to have the concurrence of the mayor,” he said Tuesday.

The new MVHS hospital, to be located in the vicinity of the Utica police headquarters and the Utica Memorial Auditorium, will consolidate services now based at the St. Elizabeth Medical Center in south Utica and the St. Luke’s campus in New Hartford.

“We are extremely grateful to the city of Utica and Oneida County for their commitment to the new hospital project and the parking garage,” said Scott H. Perra, MVHS president and CEO.

“This is a significant milestone for health care in our community,” theMVHS president added.

There is some opposition to putting the new facility in downtown Utica.