A public notice regarding proposed changes to the makeup of Hutcheson Hospital Authority board is scheduled for publication Wednesday in the newspapers of record for Catoosa, Dade and Walker counties.
Board Chairman Corky Jewell said the original board structure, when the facility was known as Tri-County Hosptial, had been based on proportional representation based on the population of each of the three counties.
Walker, being the most populated, had four members; Catoosa, being smaller, had three members and Dade, being the least populated, had two members.
Over the years, the census of the two larger counties has increased markedly and now nearly as many people live in Catoosa as in Walker and both have far outpaced population growth in Dade.
“Today’s proportionality is 45 percent (Walker), 44 percent (Catoosa) and with Dade having the remainder, about 11 percent,” Mr. Jewell said. “Using that original schema would find Walker and Catoosa having nearly equal members and result in a 4-4-1 board.”
Dade County does not agree and declined signing an intergovernmental agreement that would have its delegation surrender one board seat to Catoosa.
“The only way this (restructuring the board) can be done without an intergovernmental agreement is by an act of the legislature,” Mr. Jewell said. “My understanding is that there must be five days when the legislature is in session after the announcement before a bill can be considered.”
Hutcheson Hospital was on the brink of insolvency in the spring of 2011 and entered a management agreement with Erlanger Health System that included financial support of a $20 million line of credit.
Both Catoosa and Walker counties pledged their support of the hospital by guaranteeing that $ 20 million loan, Dade offered moral support but no financial commitment to the venture.
Now, Hutcheson’s day-to-day operations have returned to profitability but its debt load continues to threaten its continued success. Administrators hope to relieve themselves of a portion of that debt and finance overdue upgrades to the hospital by issuing $25 million of bond anticipation notes.
Again, Catoosa and Walker counties are willing, as equal partners, to essentially co-sign a guarantee of those bonds. And again, Dade County is unwilling and unable to pledge its financial support of the hospital.
For that reason the larger counties are asking that the board’s makeup be changed if they are to each guarantee $12.5 million of the total bond — it is either a deal maker or breaker, it was stated.
“This is a mechanism by which the two counties have a guarantee of proportionate liability,” Mr. Jewell said. “This is a situation that in order for us to move forward, there must be some agreement on what needs to be done.”
After today’s announcement, the state of the hospital is now in the hands of the legislature.