The Catoosa County Board of Commissioners on Tuesday morning voted to issue $35 million in bonds to cover the debt at Hutcheson Hospital in Fort Oglethorpe.
However, Walker County Sole Commissioner Bebe Heiskell said she will not go along with that approach. "I have been informed that the Catoosa County Commission voted this morning to immediately move forward with credit backing of $35 million dollars in Bond Anticipation Notes (BANs) for Hutcheson to consolidate its debts, conditioned upon either Dade County or Walker County joining them in the credit backing.
"Last Friday I announced that I was not willing to unnecessarily put the Walker County taxpayers at risk for these BANs, which BANs in effect obligate the taxpayers to the follow-up Consolidation Bond of $60 million dollars or more.
"I said then, and affirm now, that Walker County will immediately back an additional working capital Note of $3.4 million, to add to the $3.3 million still on hand from the previous working capital note. This $6.7 million line of credit for working capital will supply all critical needs of Hutcheson and its physicians for the next two months pending the receipt of proposals from potential lease partners via the Request for Proposal (RFP) process that is well underway, with proposals due back no later than October 25.
"That $3.4 million amount is based on the estimates from the Hospital’s own administration as to what cash is needed to meet hospital and physician needs pending the RFP decision, and will also give Hutcheson a half million dollar emergency cushion.
"In addition, I am informed that a BAN of $35 million dollars will not even consolidate the debts and give the needed working capital pending the Bond. I am informed that the number is at least $40 million dollars.
"My job is to protect the interests of all the citizens of Walker County, both private and corporate. No one has provided more support to Hutcheson than have I on behalf of Walker County. Over the past three years, Walker and Catoosa Counties have split responsibility for credit backing for approximately $30 million dollars in additional loans for Hutcheson. Dade County has backed zero.
"However, to unnecessarily burden the taxpayers with an additional credit obligation of at least $60 million prematurely, and with no plan from the Board or Administration to pay it back except through the RFP generated lease, when the Hospital’s own administration says it only needs an additional $2.9 million to get them through the RFP process, is just not a reasonable risk. I will not do it. I will not put the Walker County taxpayers unnecessarily at risk on such a business decision.
"I have offered a reasonable and adequate short term solution with credit backing for an additional $3.4 million dollar working capital loan. Dade County has already said they will do nothing until and unless a Lease from an RFP partner is in place. If Catoosa County will not join Walker County in its moderate proposed solution, then I am prepared to go it alone and Walker County will back the $3.4 million dollar loan without Catoosa County. I will make certain the Hospital and the physicians have everything they need. Hutcheson Board, members from Walker County, John Culpepper and Bill Cooke, fully support this decision.
"On the other hand, if Catoosa thinks backing the $35-$45 million in BANs now as opposed to after the RFP is in the best interest of their citizens, then I will step back and let Catoosa back these BANs with no interference from Walker County.
"They have my blessing, and Walker County still pledges to back an appropriate takeout Bond at the appropriate time after a new lease partner is secured. Perhaps Dade will join Catoosa.
"The current hospital is almost entirely in Catoosa. The future of the hospital is on the Parkway and will all be in Catoosa County. Catoosa County businesses control most of the professional and financial services of the Hospital. The Parkway facility is 49% owned by a private group. Catoosa County folks own the surrounding property where the Hospital must expand in the future. So, given these extra benefits, I understand why Catoosa might be willing to put its taxpayers more at risk. I give them my blessing."