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|04-12-03: Hospital board finalizes cancer center
|By TIMOTHY COX
The Daily Standard
COLDWATER - The final piece of a complex financing puzzle fell into place Friday afternoon
when Mercer County Community Hospital board members approved that hospital's stake in a
regional cancer treatment center under construction in Celina.
The Mercer County hospital board was the fifth and final member of the
West Central Ohio Regional Healthcare Alliance to sign off on bond financing documents
that should close the deal on Tuesday when $6.12 million in bonds are issued to go toward
the project. Alliance hospitals in Coldwater, St. Marys, Van Wert, Lima and Bellefontaine
joined together nearly two years ago to form the non-profit Cancer Network of West Central
The $6.8 million, 24,000-square-foot oncology unit is under
construction just off Havemann Road in Celina. Work was began with a $500,000 line of
credit. The Grand Lake Regional Cancer Center is expected to open early next year.
Alliance hospitals also plan to build a similar treatment center in Bellefontaine.
Hospital board members waded through stacks of legal papers and
approved several agreements and resolutions necessary to close the deal. But all of the
legalese boils down to one thing.
"In essence, the hospital is assuming one-fifth of the debt,"
CEO Jim Isaacs told a half dozen board members who attended the special meeting.
The hospital's share of the cost would be $1,224,000 plus interest over
the life of the bond issue. The 20-year bonds will be made available only through a
private issue, with flexible interest rates computed weekly through a complex formula and
capped at 10 percent. An initial rate will be determined after Tuesday's anticipated
Cancer network officials expect the debt will be retired sooner than 20
years, Isaacs said.
"If there is high usage, it will be paid off more quickly,"
Revenue from the cancer center is expected to cover debt payments,
Isaacs said. If revenue falls short, other hospital funding can be used, he said. However,
even though the bonds are officially issued by the Mercer County Commissioners, no local
tax revenue could be used toward the debt, he said.
The hospital alliance had pursued federal funding to help build the
center and reduce the cost to each local hospital, but the project was passed over during
the last federal budget process, Isaacs said. Officials are considering whether to reapply
for funding the next time it is available, he said.
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