Sherman to help finance former WNJ Hospital demolition

Michael Hutchins
Herald Democrat
The Sherman City Council has agreed to provide up to $400,000 for the demolition of the former Medical Plaza hospital site.

Sherman has agreed to help with the demolition and removal of a former hospital to allow for redevelopment.

The City Council has approved a financing agreement with Aspire Two, LLC to provide up to $400,000 to assist in the removal of the former hospital on Gallagher. Developers with Covenant Development and Aspire Two, said the end goal will be to replace the former hospital with new residential development.

“This particular agreement is really a reimbursement agreement for their first phase of their project, which is to demolish and re-mediate the old Medical Plaza structure there on Gallagher Drive,” City Manager Robby Hefton said.

Under the terms of the agreement, the city will use funds from Tax Increment Reinvestment Zone #3 to help finance the asbestos removal and demolition at the 14 acre site.

The TIRZ is a special zoning classification that allows the city to set aside a portion of property taxes for improvements in the zone. Once a zone has been established, any taxes beyond the initial increment are set aside in a special fund.

As these improvements are made in a TIRZ, the city hopes that will in turn increase the value of the zone and lead to more funding for public improvement projects.

TIRZ no. 3 was initially created to support improvements to the Sherman Commons, but was expanded earlier this year to encompass the nearby hospital ahead of the development.

In doing so, this allowed the city to help with the project using TIRZ funds.

Ryan Johnson, representing Aspire Two, said current estimates call for the asbestos removal to take about 60 days, with demolition over the following two months. At that point, Johnson said the area will be bare and ready for development.

Earlier this year, Johnson said plans for the development included residential uses, with some office uses, but declined to comment on specific details. At the time, city officials speculated that the office uses could be medical related due to other nearby uses.

One remediation and demolition are complete, city officials said developers could return and request further assistance with construction.

In the lead-up to demolition, Johnson said crews have cleared out some of the equipment that remained in the building and have been finding a new home for these pieces. Some kitchen equipment and furniture is going to the Grand Central Station Dining Car to help furnish its expansion.

Members of the council thanked Johnson for helping the city’s non-profits with this equipment.

This project may be the last to be supported by TIRZ no. 3 as the area is mostly developed at this point. Once the project is finished, city officials may explore retiring the zone.

“At that point, the council will have a decision to make about doing away with the TIRZ or finding a project that would make sense,” said Nate Strauch, Sherman Community and Support Services Manager.