Committee begins review of cost analysis for new hospital |

Committee begins review of cost analysis for new hospital

Jeremy Browning

The Memorial Hospital building committee is reviewing the long-awaited cost analysis report detailing construction price estimates associated with building a replacement facility.

The cost analysis looks at different sites including the hospital’s current location.

Committee chair Ron Danner said the committee is digesting the lengthy report, aiming to boil it down and summarize it for presentation to the TMH board of trustees later this month. Eventually, the board will engage the public in a dialogue about the site proposals.

“We will present the information to the board and decide how to disseminate it to the public,” Danner said.

The analysis report shows different costs for the sites even though it is assumed the same structure would be built at whatever site was chosen, Danner said. Some sites have utilities and some don’t. Some have road access issues, and some have added excavation costs for leveling the land. The report combines those factors to produce a summary.

At this phase in the process, TMH is working to coordinate all perspectives on the planned construction project. That begins with the building committee reviewing the cost analysis report, said community relations director Pam Thompson.

In the next steps, TMH officials hope to develop a feel for the community’s perspective through a public forum and a community survey, Thompson said. The survey process will have to be approved by the board. Then TMH will contract with a firm to conduct telephone surveys of Craig residents to get an accurate idea about how the community at large wants to proceed.

Some community members weighed in last year, imploring the board to look beyond the current site as it considers the location of a new facility. The uproar came at a time when the board was pursuing plans to secure financing from the Department of Housing and Urban Development (HUD) for the construction of the hospital at the existing site.

The result has been that the replacement hospital slated for construction beginning in summer 2003 has been delayed considerably.

But both Danner and Thompson said the seemingly disappointing delay has been worthwhile.

“What we’re doing now is very productive,” Danner said, alluding to the investigations of the five proposed sites. “We have answers to questions we didn’t have before.”

The combination of research and community input will help to allay fears that the decision was made too hastily.

After the research and public scrutiny, “We will know we made the right decision,” Thompson said.

While the board and the community and the raw data about site costs have their place, Danner said, “The government is going to have a significant role in the decision of what the hospital will look like.”

There may be an ideal site that is cost-prohibitive, Danner said. And since most of the money for the replacement hospital will come from HUD funding, the agency may turn out to be a bigger player than the board and the community and the construction cost data show. In a sense, HUD has veto power.

But Danner said the board is putting together the required components for a project of this scale.

“You have to go about these things in steps,” Danner said. “The next big factor that could overrule everything, is, ‘What can we afford?'” Danner said.

The hospital’s financial slump this year has raised questions about how much debt service it can support.

In a letter to the board of trustees in late August, Hospital Administrator Randy Phelps wrote, “What continues to be a worrisome part of the business picture is our disappointing performance financially this year in the face of pretty nice patient service volumes.”

TMH continues to leave personnel vacancies unfilled except when the position is “vitally important” to patient services, Phelps wrote.

The administrator praised managers and department heads for picking up extra shifts and making do with available personnel. These efforts, Phelps wrote, are indicative of a “spirit” that will “win the day,” fostering a financial turn-around.

Another component of the financial picture will be the funds raised by The Memorial Hospital Foundation. But without architectural renderings of the proposed building and, in the absence of a firm decision about the building’s site, the foundation has decided to discontinue its capital campaign for now, Thompson said.

To date, the foundation has raised more than $300,000 for the new hospital. Its goal is $2 million in grants and community contributions.

Until plans for the proposed construction are more solidified, Thompson said the foundation will focus instead on raising money for services and equipment for the existing hospital.

The shifted focus will be beneficial, Thompson said, in that it will show the community that the foundation is still working actively to help the hospital and, in turn, the community.

Also, upgraded equipment secured as a result of the foundation’s grant-writing efforts will be transferred to the new site when it becomes operational. In a sense, the foundation is still working to benefit the new hospital by improving resources at TMH that can easily be turned over to the replacement facility.

Thompson assured donors that contributions they’ve already made to the foundation will remain designated for the new building and will accrue interest as plans continue.

“We don’t want people to think we were spending their money on other things,” Thompson said.

Minutes from a recent foundation board meeting indicate the foundation will write letters to current donors explaining the foundation’s activities and the reasons for suspending the campaign.

Jeremy Browning can be reached at 824-7031 or

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