Hospital board tables Richmond clinic bids

This article submitted by Michael Jacobson on 5/5/99.

The Paynesville Area Hospital District Board of Directors prolonged their meeting last Wednesday night to vote on building a new clinic in Richmond, but they ended up tabling the bids when the fate of the Tax Increment Financing (TIF) District became unclear.

A delegation from the board-- administrator Willie LaCroix, board member Bob Brauchler, and physician Allan Solum--left the hospital board meeting to attend the Richmond City Council meeting held concurrently at Richmond City Hall to confirm final approval of the TIF District.

While the delegation was gone, the board conducted its regular business and glanced at the clinic bids. "We had eight official bids but we could only use six, because two of them came late," said assistant administrator Bev Mueller.

The low bid was for $645,145. "They came in underbid," said Mueller, "which was wonderful."

A vote on approving that low bid would await the approval of the TIF District. The board sentiment was, "Building a clinic depends on if we have a TIF District or not."

The delegation returned frustrated. Expecting the item to be a routine decision for the city council, they were not prepared for the ensuing developments. The city council had supported the TIF District proposal this winter, and the final numbers were lower because of the bids. The TIF District was recommended by the city attorney for Richmond, who drew up the legal agreement.

The delegation said one city council member stated his reluctance to voting on the TIF District that night, citing lack of time to review the final proposal. Then, they said, the mayor commanded LaCroix to answer questions before the council.

Embarrassed and frustrated after a few questions, LaCroix walked out of the meeting and the delegation followed.

They returned to the hospital board meeting knowing neither whether the city council had voted on the TIF District nor how they voted.

"I'm tired of it," LaCroix told the hospital board, adding that he preferred retirement to the frustrations of working with the city of Richmond.

Dr. Allan Solum said he had practiced medicine in Richmond for 13 years and had a personal relationship with the community. Before attending the Richmond City Council meeting, he told the board that he felt the people of Richmond supported the clinic. After attending the council meeting that night, though, he said he realized the extent of attitudes against a new clinic. "It's to their detriment," Solum said. "They just don't realize the value of a clinic in their community."

Several hospital board members expressed concern that instead of feeling welcome the delegation was upset enough to leave the council meeting early. Board member Don Anderson said there had been more frustrations in this project than any other undertaken by the district.

LaCroix said the TIF District would make the new clinic financially feasible. The hospital board decided they couldn't approve building the clinic until they knew about the TIF District and adjourned their meeting without deciding on the bids.

The clinic bids are good for 30 days, so the hospital has until mid-May to make a decision concerning the current bids.

The Richmond City Council did approve the TIF District in a 4-0 vote after the Paynesville delegation left their city council meeting. The TIF District would reimburse the hospital district with $350,200 of its property taxes over nine years.

According to Richmond City Hall, the city is going to contact the hospital administration to set up a meeting to try to resolve the zoning issues. The lot for the proposed clinic was rezoned in September 1998 after a public hearing, but the city thinks there may be problems with the setbacks.

The health care system would still need a building permit for the clinic as well as a permit to hook up to city water.

The hospital board will hold a special meeting on Friday, May 7, at noon to discuss the Richmond clinic project.

Other business
The hospital discussed a number of other topics at their meeting. These discussions were held before the Richmond clinic decision was tabled.

If a new clinic is built in Richmond, the hospital board would likely refinance their existing debt at the same time. In addition to the clinic construction, renovations could be made at the Koronis Manor, the Paynesville Area Medical Clinic, and in several hospital departments. Right now, interest rates for tax-free bonds would be around four to five percent. "If we increased our district size, our rates could go lower," said LaCroix.

The drop might only be a decimal point or two, but "it makes quite a difference on that kind of money," said board member Mel Jones.

The bill that would allow the hospital board to accept the city of Richmond into the district has passed the Senate, but there is a difference in language from the version that passed the House. The bill is now in conference committee with Rep. Doug Stang (R-Cold Spring) and Rep. Al Juhnke (DFL-Willmar) among the three House members on the committee and Sen. Michelle Fischbach (R-Paynesville) on the Senate side.

Representatives from the health care system will be attending the Roscoe City Council meeting on Wednesday, May 12, to discuss the district.

The hospital board approved the following medical appointments to the consulting staff for a provisional period: Albert Hammond III, M.D., a gastrointestinalist; Manual Moran, M.D., a general surgeon, and Edward Green, M.D., an allergist.

Radiologist Traci Napp, M.D., has completed the provisional period and was granted full consulting staff privileges.

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