District resubmits offer for Hulett clinic

The hospital district and foundation appear to have come to a tentative agreement regarding the future of the new Hulett clinic. With the sticking point of who will ultimately own the building solved, the Crook County Medical Services District (CCMSD) Board of Trustees passed a motion on Thursday to enter into a lease agreement.

As the board meeting began, Trustee Connie Lindmier made a motion to go ahead with the one-year lease of 4725 square feet within the clinic at $1.25 per square foot per month, as well as $1250 for communal area maintenance. This, she said, would be, “The agreed-upon amount with the option to renew.”

However, Trustee Ed Ray stated that he was still not comfortable entering into a contract when the clinic’s future – and therefore the district’s stake in the building – has not been clarified.

“I want to know what’s going to happen,” Ray said. “Are we going to be leasing for the next 20 years?”

In response, Judy Hutchinson of the Crook County Hospital Foundation repeated the justifications for the clinic building: money was put aside for it “years ago;” Sundance and Moorcroft both got something but Hulett still has not; and it is “very supported” by the town. She also said the population of Hulett is likely to grow due to all the property sales taking place, and infrastructure is therefore necessary.

Hutchinson stated that, when the project began, tentative plans were supplied to the district and ex-CEO Nathan Hough was in support, but certain board members have never supported the district. She said she is not sure what else the foundation can do to show the need for the new clinic.

“I’ve heard all this before,” Ray replied. “But what are we going to do at the endgame?”

The district recently sent an offer to the foundation to lease clinic space with the terms outlined in the motion made by Lindmier. However, the offer also included a stipulation that the building will be turned over to CCMSD once it has been paid off.

The foundation declined to accept this offer on the basis that ownership of the building was not discussed during the joint meeting that had been held between the boards shortly beforehand. Instead, the foundation’s letter of response to the district indicated that it would, “open lease negotiation with any medical service vendor interested in providing service for the Crook County communities.”

However, at the board meeting, Hutchinson’s explanation of the foundation’s intent was somewhat different. The foundation’s goal, she said, is that, “We want it paid off before we turn it over.”

“If the hospital wants [the building], that’s where it needs to be, but it’s not going to happen until we get done with it,” she said.

When Chairman Mark Erickson asked if the foundation would be willing to put its intentions in writing, Hutchinson said it has to be the district’s decision whether it wants the building. Erickson pointed out that the district has already asked for the building.

“What we refused to do is make a commitment until it’s done,” stated Hutchinson. Lindmier said that, in her motion, her thought had been that, “This is the first step.”

CEO Micki Lyons suggested a compromise in which the district agreed to a one-year lease, but with some provision that the parties come back to the table once the clinic has been paid off. Board Attorney Kara Ellsbury said she would be open to being creative with the lease and could put in such a provision, “But that’s not binding in terms of the foundation would have to give it to us.”

Ellsbury suggested that the board needs to decide if that would be sufficient. Responding to a query from Trustee Sandy Neiman as to whether a letter of intent would be enough, as it is for the sale of a house, Ellsbury explained that there would be no documentation, such as an offer and acceptance, that would inform a judge what the intent of the two parties had been.

During the conversation, mention was made of what Lindmier described as “unneeded negative” coverage of the situation. The clinic will help the whole county, she said, but “people don’t seem to see that.”

Hutchinson stated that the negativity towards the clinic situation has damaged the foundation’s fundraising efforts and may even lead to a situation where the clinic cannot be paid off within one year, as the foundation had aimed to do.

Lyons asked if the foundation could sign something specifically saying that they intend to pass ownership of the clinic to CCMSD once it is paid off.

“We’re not out to make money on this, we’re out to provide a nice facility,” Hutchinson said. “I don’t think our board would have a problem with that.”

Erickson asked her to confirm her statement to mean that the district will be gifted the building, as it’s the only “bone of contention” preventing discussions from moving forward. Hutchinson retorted with her own question: will the district honor the contracts with those who lease the rest of the clinic building?

“We have to,” responded Erickson. Ray agreed, and pointed out that the Moorcroft clinic also houses non-district renters.

Discussion continued with Hutchinson still stressing that the foundation does not want to hand over the clinic until it is paid for until Neiman seconded Lindmier’s original motion.

However, as the motion only states that the two parties will negotiate once the clinic is paid off, Erickson noted that, “It’s not very specific.” Ellsbury agreed that there’s a difference between saying the parties will negotiate and saying the foundation will turn the building over, and that she will need to know which one is correct to move ahead with wording the contract.

After further discussion, a motion was made for the board to accept a contract that specifies a one-year lease at the previously agreed cost, with the option to renew for successive one-year periods at an amount agreed to at that time, which will be a reduced rate due to the fact that the foundation will have paid off more or all of the money owed on the clinic.

The contract will also include the clause that once all debt associated with the real property of the clinic is paid, it will be gifted to the district. This tentative agreement is largely identical to the proposal previously made by the district; the motion passed unanimously.

At time of going to press, a response to the offer had not yet been received from the foundation board. An open house for the new clinic building is scheduled during the Hulett Rodeo.