ROCHESTER – A last-minute catch spurred Mayor Kim Norton last week to veto a $125,000 grant to renovate a historic downtown building’s space into an apartment, arguing the project is better suited for a zero-interest loan program. The Rochester City Council disagreed.
The council shot down Norton’s veto 6-1 Wednesday amid discussions on how Minnesota’s third-largest city navigates preserving historic structures vs. allowing property owners to use whatever means necessary to make their land profitable. The vote also brought up questions over who gets access to downtown economic funding.
Council members approved a historic downtown commercial district around this time last year, which included a revolving door loan program for restoration projects that kept some of downtown’s older properties intact. Property owners raised concerns at the time, arguing that grants were a better option as it costs more to keep up aging buildings.
Destination Medical Center’s (DMC) board followed up with a downtown grant program last summer. The DMC board passed about $700,000 in grants last month, including $125,000 for the apartment project above the Marrow restaurant in the 300 block of Broadway Avenue. At the time, commercial developer Bucky Beeman said he had been thinking about the project since buying the building in 2020 but was concerned about financing.
Norton was among DMC board members who supported the project in December; the council passed it as part of a package earlier this month. But Norton said she had misgivings once she realized the project was adaptively reusing the commercial building.
“It wasn’t until the contract came before me to sign that I fully understood,” she said.
Norton said she believed projects like this, which transforms a building to create new income sources for property owners, should be paid for using loans instead of simply granting money to fix a historic building as-is. She felt it should be funded through the city’s loan program rather than DMC dollars, which include county and state funding.
The council disagreed with Norton, arguing the DMC grant money was appropriate. Council members Norman Wahl and Shaun Palmer said the project was in line with the months of work city staff and council members did to create a benefits package for downtown property owners, while member Andy Friederichs argued any sort of improvement in a commercial district brings in more money.