A major expansion of the Minnesota Sex Offender Program, once anticipated to bring hundreds of jobs to St. Peter, will now likely happen in Moose Lake.

Gov. Tim Pawlenty’s bonding proposal, released in January, includes nearly $45 million for the construction of a 400-bed residential facility for civilly committed sex offenders in Moose Lake.

Until faster-than-expected growth in civil commitments caused state officials to rethink their plan this summer, that facility was to be built on the St. Peter Regional Treatment Center campus.

Pawlenty’s proposal still requires approval by the state Legislature. But, at this point, it appears any economic benefits from the growing number of civilly committed sex offenders in the state will go north.

St. Peter City Administrator Todd Prafke said city officials were planning on additional treatment center employees when preparing documents such as a recently released housing study.

“Some of the work going on in town has been with the anticipation that that type of work (at the treatment center) would take place,” Prafke said.

St. Peter Chamber of Commerce President Larry Haugen said businesses were eager to serve the new employees.

“It’s certainly been the optimistic topic of conversation around St. Peter,” Haugen said.

About 1,000 people are now employed at the treatment center, making it St. Peter’s largest employer. While growth there may proceed slower than expected, it will not be stagnant.

State Operated Services runs both the sex-offender program and the Minnesota Security Hospital, a program for the mentally ill and dangerous. As the sex-offender program grows in Moose Lake, the security hospital will expand in St. Peter.

Mike Tessneer, State Operated Services corporate executive officer, said the security hospital population is also growing faster than expected, at the rate of 20 additional patients per year, up from about five per year.

“The growth we anticipated a year ago, I think it is going to be in St. Peter — it’s just going to be in the security hospital, not the sex offender (program),” Tessneer said.

Still, the sex offender program is growing at almost three times the rate of the security hospital, adding 60 to 80 patients per year. That growth was too much for St. Peter’s Pexton Hall, remodeled recently to add 104 beds for sex offenders.

Originally expected to accommodate the sex-offender program until the 400-bed facility is completed in 2008, Pexton Hall may now run out of room as early as April, Tessneer said.

As a stop-gap measure, sex offenders temporarily will be housed in a space at the Minnesota Correctional Facility in Moose Lake. The state prison is adjacent to the State Operated Services facility for sex offenders.