Hospital’s loan bid wins council’s nod

Posted March 27, 2013 at 4:05 pm

By Steve Peterson

Hawarden city councilors gave Hawarden Regional Healthcare officials the support they needed to go forward with an application for a loan from the United States Department of Agriculture (USDA) Rural Development.

Councilors voted 4-0 in support of the hospital board’s plan to go forward with the loan application at their March 13 meeting.

HRH CEO Jayson Pullman said it will take four to six months before USDA officials give their final decision.

“We’re asking for support so the USDA can scrutinize our proposal,” said Pullman, adding he was pleased with the councilors’ vote. No city funds are obligated at this time.

In January, Pullman gave Hawarden councilors a report on what the future of the hospital will look like in an expansion and renovation project that will serve the hospital and community needs for decades.

The hospital will present more details through its work with R.W. Baird Inc. to the USDA. The total project will be $9.9 million and the square footage will stay about the same as the present campus, 30,000, on 1111 11th St. in Hawarden.

Pullman and Kristopher Marwin and Melissa Springer of Samuels Group, who have been working with the hospital expansion-renovation project for about a year, made the presentation. Hoefer & Wysocki Architecture is the architects.

Earlier presentations

“We feel it is necessary for the hospital. It’s a project that makes sense for the community and hospital needs for 20 to 30 years,” said Pullman, adding the plan calls for demolition of the original 1936 wing of the hospital due to its cost of upgrading. “The building is sound but there are significant flaws such as ceiling to floor problems, water leaks in the kitchen and there are tuck-pointing problems.”

Phase I floor plans include an ambulance-emergency department entrance with expansion to 2,250 square feet; radiology area for 2,280 square feet; surgery area for the first phase of 3,050 square feet and 2,400 in Phase II; a 1,555 square feet clinic, a business office; waiting area of 1,000 square feet, a medical-surgery expansion area with eight private patient rooms and 12 semi-private patient rooms; separation of public and staff circulation; an upgraded and efficient mechanical system; and expanded hospital services department.

A new surgery suite will be included with a state-of-the-art operating room; three surgery prep and recovery rooms; renovated physicians’ locker and lounge. Benefits include expansion of services and procedures; increased physician recruitment and ease of expansion and growth.

Revenues generated from the project will be a positive Medicare reimbursement from an annual loss to a positive annual gain, according to the first plan.

“We’re a Critical Access Hospital and we feel we fit the description of that the best,” said Pullman.

Critical Access Hospitals are small, rural facilities which provide 24-hour emergency services with a maximum of 25 acute beds; an average length of stay of 96 hours with both inpatient and outpatient services. The hospital has 10 acute and 15 “swing” beds.

Springer told councilors that through the USDA loan process, the city’s risk will be limited liability.

The Hawarden Hospital Board of Trustees recommended the funding to be a combination of intermediate-term fixed rate tax-exempt (bank placement) and long-term fixed rate working with the staff at Baird Inc.

“We addressed it through financial tests that this will stand on its own and be a sustainable project. We want the project to stand completely on its own with no General Obligation bond from the city,” said Springer.

Pullman said there will be an opportunity for residents to contribute financially. A consultant, Steier Group of Omaha, Neb., has been hired to do interviews with community leaders in the next two months before a capital campaign is started.

Editor’s Note: The USDA loan process is the same as Akron Care Center’s successful garnering of funds for its new project.

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