Mahaska Health Partnership a continued discussion on the Urban Renewal Proposal

Mahaska Health Partnership

I want to thank Mahaska Health Partnership’s Jay Christensen for taking the time to answer some questions over the hospitals expansion project.

Osky News – I have heard several different amounts tossed around. What is the projected cost of the expansion? How much is MHP going to bond on the project?

“The total cost of the project is $22.5 million. The bonded amount is expected to be $24.9 million, which includes capitalized interest costs during construction, bond issuance fees and a debt service reserve of $2.2 million, which is essentially the last year’s payments set aside in advance. MHP will have invested about $2.2 million out of our reserves for Phase I and architectural fees.”

Osky News – Will this impact Mahaska Counties ability to fund other projects at their currently low interest rate while having MHP’s bonds as well? or will their interest rate climb for their projects they many need to cover in the future?

“The County’s bonding capacity is over $72 million and there is presently no outstanding debt. At this time there are no plans for additional debt by the county. As our principle is paid down that would also free up the bonding capacity. We would take less than 1/3 of the capacity.”

Osky News – How will this be paid for under Obama Care. Do you have any projections for payment, especially if a single payer system is implemented?

“The health reform legislation has been favorable to critical access hospitals. While there may be changes, they are anticipated to be at least a net to the present reimbursement levels. There is no plan for a single payer system in the present legislation and none being recommended at this time. If it were, the significant implementation time would provide opportunity for us to alter our strategies to work within the new environment.”

Osky News – What is the next step if the County Supervisor’s deny the request for the GO bonds?

“Our board would have to evaluate our options at that point, which could include the issuance of revenue bonds.”

Osky News – Greg Gordy mentioned a public vote, is MHP opposed to such a vote? Is there time in your building schedule to allow a public vote currently?

“Because we anticipated funding from the USDA, we have bids on Phase II of the project waiting for our final funding selection. Those bids would not still be valid by the time an election would be held, which would mean re-bidding and could also increase costs of the project.”

Osky News – In the currently political climate, the possibility of increased taxes stirs much response from the public currently. I have heard many people in favor of the expansion, and just as many or more that dislike what is happening. I hope to be able to give the public honest and down to earth answers on this issue, and I appreciate your time in answering these questions.

“I want to make sure to state here that we are not proposing an increase in taxes. This method of financing would save future patients of MHP over $12 million over the life of the bonds and would not require an increase in taxes. This issue is not about taxation, but about the most cost-effective method to finance quality health care facilities in Mahaska County.”

There is a public meeting at 6:30, Monday December 6 at the Mahaska Courthouse over Urban Renewal of MHP. The 3rd floor conference room to hear and speak your opinion on the project.