Jun 15 2015 Public-private partnership aims to expand Mayo Clinic and transform Rochester, Minnesota

The Mayo Clinic, located in Rochester, Minnesota, is already one of the world’s premier medical centers. But that hasn’t stopped it from working with other partners in the private sector and local and state government to create a $6.5 billion plan to transform Rochester into a global biotech hub by building the Destination Medical Center.

A recent article in Fast Company profiled the public-private partnership among the City of Rochester, the Mayo Clinic, the State of Minnesota, county governments, and the private sector that aims to double the population of Rochester, transform land into office space for biotech and pharmaceutical firms, rejuvenate the downtown area, develop amenities, and build infrastructure (possibly even a new rail link to Minneapolis). The Destination Medical Center project is massive — It will take more than 20 years to complete and require $6 billion of investment from the private sector, as well as $585 million from state and local government, which will be generated through sales tax increases and diversion from other portions of the state and local budgets.

The Mayo Clinic expansion is an interesting example of a city building itself around a company. Proponents say the project is likely to improve the quality of life in the Rochester community, with added infrastructure, more jobs, and the transformation of Rochester into a “destination city,” with all of the amenities that go along with that designation.

But some are wary of the private sector having so much influence on the fabric of the city. As an article in the New Republic notes, “because the decision to double in size was made entirely within Mayo’s executive offices, this private hospital, not city hall or the state, is in charge of transforming Minnesota’s third most populous city.” The government has thus far been supportive of the plan, but as Rochester Mayor Ardell Brede points out, there was some surprise that came along with the magnitude of the tax ask, and “some of the citizens say why doesn’t Mayo just pay for this?”

The Intersector Project has recently started exploring a potential “public sector gap” in the cross-sector support industry. As our Executive Director Neil Britto explains, with increasing private sector and non-profit involvement in public services, the public sector has to be prepared to take responsibility for “creating public value in collaboration with other sectors.”

Some of the details of the two decade expansion plan are still vague. With the private sector taking the lead in Rochester, it’s difficult to tell at this stage of the Destination Medical Center project will transform Rochester in a way that benefits its residents, improving schools and bringing jobs and necessary infrastructure into the city, or if the benefits will fall mostly to the private hospital that is at the helm.