By Tina Fisher Forde
The Forde Files No 67
Hospital $20 million short; board hires top fundraiser
Shedding Light On Local Issues
Share
Tweet
Tina Fisher Forde
March 24, 2014 – A crew from Johasse Rebar, Bakersfield, installs rebar for the foundation of the Tehachapi Replacement Critical Access Hospital. From left, Brandon Haycock, Bobby Pate, Jose Gonzales and Adam Molina.
The Tehachapi Valley Healthcare District board of directors approved an expenditure of $25,000 to hire financial advisor and investment banker Gary Hicks to provide a plan for raising $20 million to complete the construction budget of the Tehachapi Replacement Critical Access Hospital.
Interim Chief Executive Officer Evan Rayner said at the Mar. 26 board meeting at the Golden Hills Community Services District that the district "will come up with new ideas and explore other avenues of financing and funding."
Those ideas include looking at new options for equipment, loans, grants and philanthropy in what Rayner called "a faceted approach to planning."
Both Rayner and Interim Chief Financial Officer Chet Beedle have worked with Hicks and spoke highly of his ability to locate funding possibilities. Hicks' resume lists his fundraising projects for more than 200 healthcare-related entities, for a total of $3,450,170,756.00 in funds found.
The new Tehachapi hospital is now 30 percent complete, with a targeted opening in the first quarter of 2016.
Project Manager Stacey Pray of SHP Project Development told the board that $22.8 million has been spent on construction, of which $22.2 is bond money. She said $44.5 million is left in the bond funds.
"I am managing an $86 million project," she said. "I am not showing any other source of funding at this point."
If funds drop too far, she said, "I will recommend a cease and desist order."
The construction of the hospital at the Capital Hills site is stalled due to four construction problems, two of which have been resolved, she said. Additionally, the Inspector of Record, who is required to be on site full time, has given notice, creating a vacancy the district must full for construction to continue. Pray said she is negotiating with another inspector.
While the schedule is lagging, contractors are still at work completing the foundation (see photo).
"Right now we're dead in the water," Pray said. "I believe we can catch up. Next month we will see a slight shift."
The project has been spending $1.5 to $2 million a month but with the unexpected delays, that amount has dropped.
"We're not spending as much money as I would like," Pray said. "We're not building as much as I would like. In April we'll get it back up to $2 million [a month]."
In other healthcare district business, the board (director Dr. Kim Horowitz attending remotely by speaker phone) approved moving the remaining $44,549,124 in bond proceeds from a Wells Fargo money market account to a Local Agency Investment Fund (LAIF). The Well Fargo account earns .01 percent, while the LAIF will earn approximately .25 percent.
The LAIF will earn $110,000 more in annual interest, minus a $1,000 transfer fee. The account also provides the liquidity needed for construction.
The board approved the extension of interim pharmacist Dr. Kim Hoffman's employment to July, for a total of 12 months. A former pharmacist at Tehachapi Hospital, she returned when the staff pharmacist quit suddenly.
