Pinckneyville Back on the Road to a New Hospital
</element><element id="paragraph-1" type="body"><![CDATA[The Pinckneyville Community Hospital Board of Directors unanimously passed a resolution allowing Hospital Administrator Tom Hudgins to submit a pre-application for a loan from USDA to build a new facility.
USDA will have 45 days to review the pre-application before deciding whether or not to invite PCH to submit a complete application. Hudgins plans to have the pre-application in by the end of the month and a denial or an invitation for a complete application from USDA by May 15. Review of a complete application would take an additional 30 days.
Prior to approving the resolution, the board reviewed an update to the debt capacity study and construction cost estimate.
At last week's special meeting, the Board asked Hudgins to contact the auditor about updating the debt capacity study to reduce the projected construction time from 24 to 16 months and to reallocate the real estate tax funds which are currently being used to pay bonds. When those bonds are retired, the same amount of money would be collected and put towards the new debt.
"We aren't raising taxes," said Board President John Shotton. "It's a reallocation, not an increase."
The adjusted debt capacity study showed PCH could feasibly repay $22.7 million. When combined with cash reserves and other funding, the hospital could spend up to $27 million on a new facility.
The debt capacity study by Wipfli which was reviewed last week showed PCH could feasibly repay a loan of $18.5 million at an interest rate of 3.375 percent over 40 years. Combined with the cash reserves and a capital grant, PCH could spend up to $23 million on a new facility.
The most recent construction cost estimate submitted by Contractor Robbins Morton was $25,153,000 for the proposed new facility.
Hudgins said Robbins Morton has already reduced the estimate by $200,000 following a new quote on concrete work. Further reductions may be possible once actual bids are taken.
The preliminary construction estimate discussed at last week's meeting was $24.9 million.
Hudgins said the next step in the process is to authorize Prism Consulting to begin the paperwork to alter the certificate of need to reflect the changes made to the proposed facility footprint. Total cost for completing the alteration paperwork and presenting it to the Health Facilities Planning Board will be $60,000 to $65,000.
The board asked Hudgins to get a cost breakdown from Prism showing what the hospital would be obligated to pay at various points in the process such as by May 15 when an answer is expected from USDA. If no invitation for a pre-application is issued, the project ends there.
The board will consider the cost breakdown at the April 2 meeting. Hudgins said that Prism needs to begin the paperwork in the first week of April in order to have it ready by the September meeting of the Health Facilities Planning Board.