Luring the IU medical school to downtown Evansville was the first hurdle. Now, city officials are working to create a financing package in order to pay for it.
In a 'historic and transformational' decision Friday in Bloomington, the IU Board of Trustees selected downtown Evansville as the site for the new medical school. Other possible locations included the USI campus, the Promenade on the east side and Warrick County. The facility will be located in an area bordered by 4th, 6th, Cherry and Locust Streets in downtown Evansville. The site will be near the new convention hotel.
City Council President John Friend said he fully supports the medical school project. He also expects that the rest of the City Council does too. Now, Friend said, the Council and Mayor Lloyd Winnecke are tasked with finding a way to pay for it.
"It makes you think you just walked out of a Krispy Kreme donut shop. You get glazed over so much because those numbers are so large," Friend said.
The medical school project will require a $51 million public investment, Friend said. Around $15 million of that total will go toward improvements to infrastructure.
"It's all simple," Friend said. "It's just like any other household. 'I have so much money I make. Basically, I can only load my credit cards up to a certain degree."
The most recent charge on the city's credit statement is the new convention hotel. After months of negotiations, the public subsidy was lowered to $20 million. Because of that, Friend said, the city can finance the medical school, the new hotel and the Ford Center through the downtown TIF district.
The downtown TIF district generates around $6.6 million a year. Fried said $3.8 million of that covers the annual bonds for the Ford Center. Paying for the new hotel, Friend said, requires a $1.3 million annual commitment from the money generated by the TIF district. After paying for those commitments, it leaves about $1.5 million available. Right now, the city can use that available money to finance $37.5 million over 25 years.
Furthermore, the bonds on the Old National Bank Events Plaza will expire in 2018. Once they do, it will create more bonding capacity, Friend said. Also, when the hotel and medical school are finally constructed, more money will be generated within the TIF district.
Other funding sources for the medical school will come from food and beverage taxes as well as riverboat funds, Friend said.
"I want everybody to understand one thing: this money is not going to affect anybody's property taxes as they see it," Friend said. "It's all coming from the money generated from that TIF."