August 21, 2013

Council commits funds for new healthcare facility

By Neal A. Shipman
Farmer Editor

The McKenzie County Healthcare System will be receiving upward of $500,000 from the Watford City Roughrider Fund to help build a new replacement hospital and clinic, as well as to remodel the existing Good Shepherd Home long-term care facility.
Just a few days after Watford City’s City Council had sent the request for assistance back to the Roughrider Fund for further clarification, the council, along with the Roughrider Fund Committee and representatives from the McKenzie County Healthcare System met on Wednesday, Aug. 14 to hammer out the details that will pave the way for a new $55 million facility.
The urgency of Wednesday night’s meeting was noted by Gene Veeder, McKenzie County Job Development Authority executive director.
“We want to get a decision tonight,” stated Veeder, who served as a moderator during the meeting. “This project needs to move forward quickly to get Bank of North Dakota and U.S.D.A. loans.”
According to Dan Kelly, McKenzie County Healthcare System CEO, the system’s original request of $100,000 per month for 40 years is being scaled back to just $100,000 for five months in order to get the process started.
“We don’t have all of the data that the city council asked us to have available at this time,” stated Kelly. “But under this proposal, we will be able to begin our construction project.”
According to Kelly, the healthcare system is applying for a $15 million low interest loan from the Bank of North Dakota, as well as a $40 million U.S.D.A. loan.
“With the Roughrider Funds and the Bank of North Dakota loan, we’ll be able to start with our project even if we don’t get the U.S.D.A. loan,” stated Kelly. “If we get all of the loans, it is possible we’ll come back to the Roughrider Fund for more assistance.”
The healthcare system is facing a Sept. 1 deadline to request the Bank of North Dakota funds. And that deadline, according to Kelly, is the reason the entire process has appeared to be rushed.
“The Bank of North Dakota needs a letter of support that we have funding up to $500,000,” stated Kelly. “Without the outside support of the Roughrider Fund, we don’t have the revenue to sustain the debt.”
However, again Kelly pointed out that the healthcare system’s ultimate goal is to obtain funding from the U.S.D.A. that will allow the entire project to be constructed at one time.
“Our overall goal is to do the project in one fell swoop,” stated Kelly. “It is far cheaper and less disruptive  that way.”
Part of the problem facing both the Roughrider Fund and the city council in committing funds long-term to the healthcare system is the fact that the fund is set to terminate in September of 2014, unless city voters approve a ballot measure extending the city sales tax.
“I’d encourage the hospital to look at a long lasting revenue source,” stated Justin Voll, city councilman. “Considering the amount of money now coming into the Roughrider Fund and looking at the other requests that will be coming in the future, $100,000 a month is a very big commitment.”
Voll suggested that the healthcare system also consider a county sales tax or a county mill levy to help fund the replacement facility.
“We’d like to hear from the city council what our options are,” stated Kelly. “We’re at the table.”
According to Voll, a county sales tax could raise between $250,000 and $400,000 a year.
But according to Linda Svihovec, McKenzie County auditor, before a county sales tax could be implemented the county commissioners would have to change to a home rule charter and then a county sales tax would have to be supported by two-thirds of the county voters.
Under the motion that was passed by the city council, the healthcare system will receive up to $100,000 per month, up to $500,000, contingent on the Bank of North Dakota loan being approved and upon groundbreaking for the new facility.