PAHCS may wait to do building project

This article submitted by Michael Jacobson on 5/31/00.

A renovation project at the Paynesville Area Health Care System may not be ready to start this summer, causing administrator Willie LaCroix to suggest that the project should wait until next spring.

At the Paynesville Area Hospital District's board of directors regular meeting on Wednesday, May 24, LaCroix told the board that the mechanical and engineering plans are not finished and might not be ready until July. That means construction would not be able to start until this fall.

Before the hospital system can bid the project, the design needs to be approved by the health department. LaCroix estimated approval would take at least a month, and possibly several.

The project includes major renovations at the hospital and the adjoining nursing home. A new emergency entrance and maintenance room would be added to the hospital, as well as additional exam rooms to the system's main clinic.

In addition to the new emergency room, the nurse's station in the hospital would be moved, a second surgical suite would be added, and the outreach department would almost double in size.

Because the outreach department is in the middle of the building, other departments need to vacate space for it to expand. This complicates the remodeling plans, and makes the mechanical and electrical plans more involved.

The Koronis Manor will be reroofed and will have a sprinkling system installed to meet fire safety codes. A new dining room and a second tub room will be added to the facility.

The administration proposed more substantial changes to the 64-bed nursing home. A proposed addition would turn the facility from primarily double rooms to singles.

The larger project was delayed partly because of cash flow concerns, but primarily because the state will only reimburse the system for $750,000 of improvements to the nursing home per year. The system is now considering a series of projects to upgrade the facility to make it more patient-friendly.

The board decided on a limited project this winter. LaCroix said the mechanical and electrical plans couldn't be done until the extent of the final project was settled.

LaCroix said a recommendation from the hospital system's construction professionals was to start bidding certain parts of the project without having the all the plans finalized. Neither he nor the board was very receptive to that idea. "we've come methodically this far," said Doug Ruhland, who represents the city of Eden Valley on the board. "We don't want to rush now."

"I agree with your thinking to wait until everything is ready," added Don Thomes, Zion Township, the board chairman.

If it gets late, LaCroix was also wary of starting the project in earnest this fall. Nice weather, like the area has had in recent years, would make it easy to work in the late fall and winter. But bad weather could cause difficulties. "I'm not sure you get your best project by starting in the late fall," LaCroix told the board.

Board member Don Anderson, from the city of Paynesville, agreed. If the project isn't ready until late fall , Anderson noted, then it's a matter of a few months to wait and bid it over the winter and start in the spring. Winter bidding and spring construction is considered the optimum schedule.

LaCroix said such a delay would actually be beneficial to the system financially. Since retiring the bonds for the 1983 hospital addition in March, the system has still paid almost $30,000 a month into a building account for the upcoming project. Starting the project next spring would give the system 36 months until the first bond payments are due. "We should be able to build some cash up by then," LaCroix said. "We'd be healthier than we are now."

One concern about waiting would be an increase in the interest rates. But LaCroix thought a rise in rates might be offset by a decline in construction demand. That might result in better bids for the work.

LaCroix also told the board that the current estimate on the cost of the project was down to $4.1 million. The original estimate was $4.9 million. "I'd just be tickled to death if we could do this project for $4.1 million," said LaCroix. The extra $800,000, he added, could be dedicated for a future project on the Koronis Manor.

Other business
•The board approved an educational loan to Mary Jo Buermann for $5,000, which is the maximum amount available through the system's employee loan fund. The board has dedicated $20,000 for educational loans.

Buermann plans to return to school to become a registered nurse.

With the loan, almost $7,000 remains in the fund. Bev Mueller, assistant administrator, expected more requests this fall.

"We've been doing this for 15 years," said LaCroix. "We've gotten some good employees out of it." The system has lost money on only one loan in all those years.

•To comply with state law, the board approved making the next term for the board representative from Richmond for only two years.

Vickie Ruegemer was appointed to the board by the city council of Richmond this winter. The seat will be up for election in November. By making it a two-year term, the seat will be put on the election cycle with the four townships in the district. In 2002, the Richmond seat will start with four-year terms.

The other five city seats-Eden Valley, Paynesville, Roscoe, Regal, and St. Martin-and the at-large seat will be up for election in November for four-year terms. For convenience sake, the district had tried to have the city seats and township seats rotate for elections. State law, however, requires an equal number of seats in each election.

•The board approved medical staff appointments for Albert Hammond, M.D.; Manuel Moran, M.D.; Allan Ingenito, M.D.; Heidi Malling, M.D.; Benjamin Rhee, M.D.; and Dale Vaslow, M.D.

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