Posted: Wednesday, July 2nd 2014 at 10:02am
Habersham, authority reach agreement to help solidify hospital
By Rob Moore Editor
DEMOREST - In joint called meetings of both bodies Tuesday night, the Habersham County Commission and Hospital Authority of Habersham County took steps to solidify the hospital's finances.
Through an installment sale agreement, the hospital authority transfers the hospital's assets to the county, and the county agrees to make monthly bond payments through the county's 0.25-mill indigent care tax.
After each body voted on the installment sale agreement, Demorest Mayor and hospital authority member Rick Austin said the joint effort sends a message to the community that both entities believe the hospital is vital.
"It signifies and solidifies that this is our community hospital and it's not going anywhere, and that we're going to do everything that we can to maintain the great service that we offer here," Austin said.
Following the meeting, Hospital Authority Chairman David Kerby summarized.
"What it means to the community is that the Habersham County Commission and the Habersham County Hospital Authority board have come together in an agreement that will allow the hospital to stay open and viable for all the people of Habersham County - and grow if need be - and invest in new equipment and things in the future, so it's a very positive thing for the people of Habersham County," Kerby said.
Similarly, Habersham County Commission Chairman Chad Henderson shared county government's perspective.
"We knew that we needed to take steps to sure up the financial future of the hospital, and what we've done is we've extended the term of the bonds," Henderson said. "However, we've got it to the point that it's actually manageable going forward. The county will be able to make the bond payments and not have to have an immediate increase in the millage rate. It will be a better situation for us because of the fact that we're not having to come out with an immediate tax increase, or a tax increase in the real near future."
Henderson said when the nearly $40-million expansion project was approved in 2007, no one could have predicted the economic downtown that was coming.
"At the time, the sky was the limit," Henderson said. "Everybody was raking in money left and right, and things looked really, really good."
Then the economy went sour, and along with it area hospitals felt the financial pinch.
Henderson said the county operates on an almost $20-million annual budget and simply can't take on a debt nearly twice that size.
"I feel like we took the steps that we needed to take to sure up this hospital," Henderson said. "I think this gives the hospital authority the ability to go out and do everything they need to do to make the medical facility, to make the medical services, the best that they can make them, without having to worry about the payments on the bonds as they've had to in the past.
Henderson also alluded to an upcoming 1-cent Special Purpose Local Option Sales Tax vote that is coming later this year. One part of that tax would go toward retiring some of the hospital debt.
"By the Habersham County Commission agreeing to make the investment in the community by utilizing the indigent care tax to make the payments on those bonds going forward - and hopefully to be able to utilize SPLOST dollars to make payments on the bonds over the next six years - it gives the hospital a much firmer foundation," Henderson said.
Asked about that, Kerby said, "At the moment, our agreement with them to negotiate has expired, so there it stands. We'll have to get back together and talk about a new agreement sometime in the future."
Henderson confirmed the letter of intent with NGHS expired as July 1 arrived, and said he and one other commissioner will join in any future talks with NGHS when they resume, noting the commissioner who accompanies him will rotate among the other four.
Still, Henderson is pleased with the progress made that culminated in the agreement approved Tuesday night. He underscored the importance of keeping the hospital viable in the community.
"Like I said, I think it's an investment," Henderson said. "It's not anything that anybody wants to see go away. There's roughly 606 employees, not to mention all the ancillary employees that go with this hospital.
"The idea of this hospital not being in this community is an impact we can't even begin to imagine," Henderson said.
Henderson said losing Habersham Medical Center would be detrimental to the community in ways no one could imagine and would have a ripple effect on professional services who provide bookkeeping, trash pickup, building maintenance, and other services to doctors' offices.
"The hospital going down actually has the ability to drag the county down completely, and no one has any interest in seeing that happen," Henderson said.
Henderson said the lowest value commissioners have seen on the economic impact of the hospital on Habersham County's economy places that impact at more than $1 billion per year.
"We think it's probably even more than that," Henderson said.
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