The El Paso City Council this week took another step to incubate biomedical companies at the Medical Center of the Americas.

The medical center is a major pillar in the council's economic-development strategy.

The council on Tuesday voted to lease an 11.7-acre parcel to the Medical Center of the Americas Foundation to be used for a biomedical research park. The council also took the first step to create a tax-increment reinvestment zone at the medical center to allow the foundation to lease city land at below-market rates.

The council has already voted to dedicate a hefty portion of the franchise fees it gets from El Paso Electric to the development of the medical center.

The lease, which with options to renew for 100 years, would allow the foundation "to act as our agent and develop that land," said Matthew McElroy, the city's deputy director for planning, who also is running the Economic Development Division while the city looks for a permanent head.

The Medical Center Foundation will pay the city $1,000 a year or 10 percent of profits --whichever is greatest -- for the parcel. As a term of the lease, construction of an 80,000 square-foot, life-science research building must start within 36 months, and a certificate of occupancy must be issued within 72 months.

Normally, tax-increment zones are used to sequester tax dollars to redevelop an area deemed to be economically distressed. But the lands at the medical center are not taxed, so there will be no money to sequester. McElroy said the city is seeking the designation to allow it to lease land below market value, as it is doing with the medical center foundation.

"This is the first thing we had to have happen in order for the biomedical park to take shape," said Emma W. Schwartz, executive director of the foundation.

Her organization is getting other city help in developing the area, which includes the Paul L. Foster School of Medicine, the University Medical Center, the Texas Tech University Health Sciences Center and a children's hospital to be opened next year.

The City Council in June voted to devote $3.3 million to developing the medical center. The money come from a franchise fee that costs an electric customer who pays $60 a month about 45 cents.

In deciding to invest so much in the medical center, the City Council rejected several other economic development ideas.

Marty Schladen may be reached at mschladen@elpasotimes.com; 546-6127.