A for-profit, private practice “health care group” is planning a 90,000-square-foot medical facility and 30,000-square-foot ophthalmology center near 23rd Avenue East and the Veterans Boulevard corridor. The larger main medical office building will be home to the health care group and will be connected to the future project “OP medical group” ophthalmology center in the smaller building.
Although the health care group is working with West Fargo-based Enclave, Economic Development Director Lauren Orchard said the group is remaining anonymous at this time.
However, the anonymity of the group became an issue for some Cass County commissioners when they were were asked to approve the West Fargo 10-year tax payment in lieu of taxes, or PILOT, program application.
At the city meeting, Austin Morris with Enclave said the group would not be planning the project for West Fargo if not for the PILOT program.
State law requires all taxing entities to sign off on PILOT plans that extend past five years. The plan was presented to both the city of West Fargo and Cass County on April 5. The West Fargo School Board unanimously approved the project at its March 22 meeting.
The West Fargo City Commission unanimously approved giving the two companies a 10-year PILOT program, which will allow for the health care group to pay $100 on the improvements annually for five years, followed by 50{b5d304c96e94113bdfc523ff4218a1efff4746200bdb9eeb3214a56a1302f2e4} of the taxable base of improvements for the remaining five years. During the 10-year PILOT program, the health care group will still pay about $1.2 million in real estate taxes.
After the PILOT program, the health care campus is expected to add a $26 million investment to the city along with 203 jobs that will pay an average of more than $60,000 per year, Orchard said.
Orchard said if Cass County does not approve the PILOT application, the project may still be able to go ahead as the county has control over just its portion of the taxes past the fifth year. In that case, the county’s portion of the tax revenue would still need to be paid by the applicant in years six through 10, Orchard said.
Cass County Commissioners Rick Steen and Mary Scherling voiced concern about the group remaining anonymous.
“It doesn’t feel good to me,” Steen said.
Orchard said the group must be named if the tax incentives are approved. Along with the anonymity of the health care group, commissioners expressed concern that the specialty medical center would compete with health care giants Sanford and Essentia Health for doctors.
Scherling said it was her understanding it was difficult to find health care providers to fill current positions in other facilities and questioned whether it would create 200 new jobs.
Orchard said the new jobs would be added gradually. About 57 base employees would start, and the centers would then grow to 203 over 10 years.
“The existing employee base is not a result of anyone departing any regional health care system and the applicant’s planned growth over time does not target employee departure from other healthcare systems,” Orchard said. “The applicants will follow recruitment processes standard in the healthcare industry as they add to their existing employment base. The expanding private healthcare group is unable to expand in its current location and building this facility is the next step to continue to advance its care for the growing patient base in our region.”
Steen wondered if such a tax break would be unfair to other health care systems if they were simply moving from those facilities.
Once operating, the medical group expects to see around 200 patients at the campus per day.
The Cass County Commission is expected to vote on the issue at its April 19 meeting.
Specialties that will be found at the medical campus will include ear, nose and throat (ENT); orthopedics; ophthalmology; neurosurgery and spine; and plastics and hand. The building will offer hotel-style accommodations for extended-stay out-of-town patients, an on-site pharmacy, ample parking with heated sidewalks and a covered canopy for pick-up zones.
“Although small in comparison to our communities’ robust regional providers, the Healthcare Group and OP Medical Group are important pieces of the overall healthcare ecosystem that makes our region attractive to residents and patients in need of this specialty care,” Orchard said.
