The city will devote $3.3 million a year to developing the Medical Center of the Americas and an additional $1.2 million to finance business incubators and try attracting jobs from elsewhere.

The funds -- earmarked for economic development -- are part of a franchise fee paid by El Paso Electric ratepayers within city limits. If such a customer gets a $60 electric bill, 45 cents goes to support the economic development fund.

Last month, the City Council rejected two competing plans to spend the $4.5 million a year that the fee is supposed to generate in each of the next 20 years. The plan that the council voted 7-1 to approve on Tuesday was a departure from both of them.

Both the city's economic development staff and the El Paso Regional Economic Development Corp. had proposed to use the money to create industry "clusters" in such sectors as alternative energy and attract well-paying companies that would invest heavily in the region.

The council's vote on Tuesday still allows money to be used for those purposes, but it reserves most of the money for the medical center, where officials are trying to develop a biomedical cluster to go along with the Paul L. Foster School of Medicine, the University Medical Center, a children's hospital to be opened next year, the Texas Tech University Health Sciences Center and other facilities.

The idea for the Medical Center of the Americas stems from an economic summit in 1998, when city leaders decided that biomedical pursuits would be a good direction for the regional economy, Mayor John Cook said.

Emma W. Schwartz, executive director of the Medical Center of the Americas Foundation, said similar industry clusters have created thousands of good jobs in regions such as Salt Lake City; Memphis, Tenn.; and Boulder, Colo.

City Rep. Steve Ortega wanted the City Council to devote the entire economic development fund to the medical center.

"I'm betting on the MCA," he said. "I think this is where the community is going to reap the largest benefit."

City Reps. Emma Acosta and Susie Byrd wanted to use a quarter of the money for other purposes, such as a Hub of Human Innovation at the University of Texas at El Paso. The hub helps embryonic businesses get a start, and it has a program devoted exclusively to alternative energy companies.

Some money can also be used by the economic development corporation to close deals with companies interested in moving to El Paso.

The medical center and all other entities will have to make individual proposals for the funds and to sign contracts outlining terms under which they can be used.

City Rep. Eddie Holguin voted against the plan because he was against charging an economic development fee in the first place.

"That money should be given back to the ratepayers," he said.

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

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