Erlanger Asks Court To Order New Walker County Taxes To Repay Debt; Whitfield Says Hospital Won't "Show Compassion" To Money-Strapped County

Wednesday, October 25, 2017

Erlanger Health System has filed a new lawsuit against Walker County, Ga., asking Federal Court to order the county to raise taxes if necessary to satisfy a debt topping $8 million.


The new lawsuit filed at Rome, Ga., names Sole Commissioner Shannon Whitfield as a defendant along with the county.


It claims that Walker County has not paid any of the debt that was accrued during the Bebe Heiskell administration related to the failure of Hutcheson Hospital.


The suit says Walker County "has acted in bad faith, been stubbornly litigious, and has caused Erlanger unnecessary trouble and expense."


Commissioner Whitfield passed a series of revenue increases designed to deal with an extensive debt he inherited, including a new tax he said would raise $2.5 million per year to go toward the Erlanger debt.


Commissioner Whitfield responded to the suit by saying Erlanger was "seeking to raise property taxes on the citizens of Walker County, in a reckless and misguided attempt to receive immediate payment for a bad business deal."


He said, "Despite being $70 million in debt and operating with negative cash flow, Erlanger believes Walker County has the funds currently available in its bank account today to pay an $8.7 million judgment. Erlanger also believes I have the ability to borrow funds without limitation to satisfy the judgement, which is illegal unless voted on by the citizens of Walker County."


He said, "The judgment stems from a 2011 loan to keep Hutcheson Medical Center open, which former Commissioner Bebe Heiskell pledged taxpayer dollars to cover.


"Erlanger's petition is filled with several inaccurate statements which border on perjury, in an attempt to misrepresent Walker County's efforts to communicate its present financial state and intention to make payments on the judgment against it.


"Despite holding multiple meetings with Kevin Spiegel, Erlanger's President and CEO, and enacting a new fee on our citizens to generate funds over the course of three years to pay Erlanger back, the country's seventh largest public hospital falsely attests that we have 'ignored' them and 'refused to pay any portion of the judgement.' In reality, Erlanger has turned a deaf ear to pleas for compassion, as our citizens, who are also Erlanger's patients, had no say in this loan and are physically sick when they learn how much is owed."


Commissioner Whitfield said he was "challenging Erlanger to clarify any misinformation coming from my office on this issue. I have said we owe the money. I have said Erlanger wants paid in full immediately. I have publicly enacted a fee to start redistributing the hard earned money of our citizens to the seventh largest hospital in the country. I have let my citizens know about Erlanger's threats to raise their property taxes seven mills to repay them for a bad business deal with an insolvent hospital and a broke county. Now, with this latest court filing, Erlanger has shown its true colors." 


Federal Court on Aug. 23, 2016, put down a final judgment in favor of Erlanger for $8,705,000, plus interest.


The issue of attorney fees and litigation expenses is slated to go to a jury.


Walker County appealed, but on July 13, the 11th Circuit Court of Appeals ruled for Erlanger.


Erlanger says it is due $171,953 in pre-judgment interest as well as post-judgment interest that continues to accrue at a rate of $141.88 per day.






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