County, Utica may pick up $41M tab for hospital garage

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Construction of a downtown Utica hospital, with a price tag of nearly $500 million, was front and center for the Oneida County Board of Legislators for about an hour Wednesday.

Scott Perra, the Mohawk Valley Health Systems chief executive officer, highlighted for the lawmakers plans to consolidate services offered at the St. Elizabeth Medical Center and St. Luke’s campuses into one new facility near the Utica Memorial Auditorium. He discussed location, funding and the construction timetable. The new facility would be finished in 2022.

Of special interest to the lawmakers was the possibility of the county and city of Utica paying for a 1,650-spot parking garage.

Perra said the new hospital is as much an urban revitalization project, with a substantial economic impact, as it is a health care one. The MVHS administrator said housing, commercial, retail and entertainment venues are positioned to benefit from the influx of employees to the downtown location. It is estimated that about 3,500 people will work at the new facility.

Several legislators asked questions during and after the hospital official’s remarks, but no objections to the project were voiced.

Building the garage would cost an estimated $41 million, an expense that’s in addition to the $480 million to design, build and equip the new 750,000-square-foot hospital, as well as buy the land needed for the project.

​Perra said the current thinking is to form a partnership between the non-profit MVHS and the city and county to build and operate the parking structure.

As envisioned, the county would bond for the project and then receive partial reimbursement on the debt service from Utica, the county’s largest city. Together, the two governments would pay off the debt. MVHS would be responsible for buying any parcels needed for the garage and demolition of buildings prior to construction, as well as ongoing operation and maintenance after it is open for business. Annual operating costs are project to be in the neighborhood of $1 million.

​”We’re not sure of that yet,” said Perra when asked if there would be a charge to park in the garage.

The MVHS administrator said 500 slots would be set aside for public parking, with the remainder used for hospital purposes. The Aud would be a likely beneficiary of the additional public parking.

Besides the garage, there would be an additional 1,500 surface parking spaces around the new hospital.

Informal discussions about the possible city-county partnership are occurring.

County Executive Anthony J. Picente Jr., a supporter of the hospital project, said after the meeting the amount of money that would be borrowed for the garage might be reduced from the initial projection as the financing undergoes more scrutiny. Possible offsets to the bonding might be state grants and market tax credits.

When he introduced Perra to the legislature, Picente said the new hospital is a “regional necessity.”

“I have been a strong supporter of this endeavor and I will continue to do so,” he said.

Board Chairman Gerald J. Fiorini, R-7, Rome, told legislators they would have to authorize bonding for the garage. Approving the borrowing could be a heavy lift for legislators on the western side of the county whose constituents may look more to Rome Memorial Hospital or Oneida Healthcare for health care needs than to MVHS.

Funds for the project, not counting the parking garage, will consist of: $300 million from the state; $150 million in MVHS financing; and $30 million in MVHS funds and contributions.

Th new hospital is expected to have 392 acute-care beds. Besides inpatient care, there will be an emergency department, outpatient services and primary care in a single location.

Perra said the downtown facility is expected to generate a savings of at least $15 million annually on the expense side versus operating both the St. Elizabeth and St. Luke’s campuses.

There are no plans at present to close MVHS’ Faxton campus, which includes a cancer center, in Utica.

Traveling with Perra was Raymond A. Meier, a former county executive and one-time state senator. He is a member of the business law department at Bond, Schoeneck & King.

Although they did not speak, there were several people in the audience who brought with them signs opposing the downtown hospital.

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