Can we afford a new hospital?

As Crook County Medical Services District (CCMSD) gears up to potentially take another shot at securing funding for a new hospital, two trustees have concerns over the overall cost.

For Chairman Mark Erickson, the issue is debt: CCMSD could indeed be granted funding, such as American Rescue Plan Act (ARPA) money, he said at last week’s board meeting, but that it will not be enough to cover the full cost of a new building.

He asked, how much debt can and should the district take on to make this happen?

“Can we afford to pay the bill, based on our run rates and our projected run rates? What kind of debt can we afford to take on?” he questioned, hoping that these questions will be answered by a planned feasibility study.

At this time, according to Casey Peterson CPAs and Financial Planners, a study is in progress and will involve data validation from additional firms.

For Trustee Brent Fowler, the issue is buy-in. He reiterated his feeling that the district should make efforts to raise its mill levy.

Without doing so, he said, CCMSD cannot prove to the state that it is fully committed to the project and will consequently be less likely to receive a positive response.

According to Trustee Sandy Neiman, the county commission must call an election for voters to decide whether to increase the mill levy above the three mills originally authorized. CCMSD would be required to pay for said election.

Fowler said that he does not disagree with any of that, but explained that he believes a long-term plan is the first step in planning a campaign to convince voters that increasing the mill levy is justified.

“When you go after these grants and you want that money, you have to prove to these people that you’re willing – our max mill for a medical district is six. We have to prove that we’re willing and the people around us are willing to help pay that price,” he said.

Fowler acknowledged that the district is unlikely to receive a grant big enough to pay for a new hospital building, whether it’s a brand new building or a rehabilitation of the current one. CCMSD will still need to come up with the money to pay for the rest, he said.

“Those grant people want us to pay our part too,” he said.

Neiman expressed concern that, especially during a time of high property taxes, people will simply not be able to afford additional tax.

CCMSD also needs a strategy for the future, Fowler said, stating that it’s “disturbing” that he has not seen a five- and ten-year plan. Without this “vision”, Fowler said, the district cannot know how it will get to where it ultimately wants to be.

“I’d be glad to head up a committee on what our future needs to be for our medical district,” he said.

A strategic plan, however, does already exist. CEO Micki Lyons responded that May will mark the two-year anniversary of when CCMSD completed its most recent plan, which she explained that this mainly involved the employees and was geared towards creating a vision of the type of organization CCMSD would like to be.

Lyons told the board that she had intended to bring up this subject, as she feels it’s time for a new plan.

“What I really want to do is have that same person come back that did our last strategic plan and involve all of you guys in that so that we can start looking at what does our next year to three years to five years look like,” she said.

The previous strategic plan did a good job of involving the community and looking at marketing and brand, she said, but now the district is more financially stable and has a path, she feels it’s time for the board to become involved and add their thoughts on the future of CCMSD.

As the conversation widened to include various possibilities for upgrades to the hospital’s services if and when a new building can be constructed, Erickson summarized the current situation.

“We’ve got some questions out with the feasibility study, and from that we’ll see what our debt-carrying capacity is, and that will enable us to be more informed when we speak with the public as to what the needs may be,” he said.

“Yes, we could propose to raise the mill levy…going through the general election, which is basically two years out, and in the scheme of a long-term plan, [two years] is not that far out.”

Erickson stated that the feasibility study will certainly factor in the maximum possible mill levy in figuring the district’s potential debt load capacity.