Although Craig City Council chambers were nearly full Tuesday night, there was no controversy. More than 20 people attended as a show of support for The Memorial Hospital.

It wasn’t necessary. There was no criticism of the hospital for recent cost-cutting steps.

“I think everyone in business will appreciate that you’re getting your house in order before moving forward,” Councilor Byron Willams said.

On Tuesday night, hospital officials updated the council about a proposed $19 million construction project. Hospital officials have submitted a sketch plan to the city’s planning and zoning commission, which begins the city’s involvement in the construction process.

“It’s a long process, and what we’re trying to do is communicate to you where we’re at,” hospital board member Ron Danner said. “You’re an integral part of our next steps.”

City officials will review the hospital’s proposed infrastructure, parking and landscaping plan and inspect the facility to ensure it meets building codes.

Danner said construction on the hospital could begin as early as spring 2007, but that schedule hinges on whether the U.S. Department of Housing and Urban Development agrees to back the project and allow the hospital to issue revenue bonds.

The hospital laid off 10 employees, asked the Northwest Colorado Visiting Nurse Assoc–iation to move and plans to move its clinic and emergency medical services to cut costs.

“We’re facing the unenviable task of increasing the bottom line so that we can move forward with financing,” Danner said.

Interim administrator Susan McGough said that during the past 10 years, the hospital has expanded its services, which put the hospital in a weak financial position.

“The hospital has not funded its future,” she said. “Our health care must be provided for in a way that’s a balance of many different things.

“The whole design of health care is changing to keep control of costs. We need to be as efficient as possible.”

Having the care clinic, housing the nurse association, subsidizing emergency medical services, supporting the diabetic clinic and Lifeline programs, and absorbing bad debts and charity care are causing the hospital to lose more than $2.5 million a year, McGough said.

“They’re all good programs, but we need to look at them in a better way,” she said. “As the industry changes, hospitals can’t function and remain viable if we do business like we did in 1995.”

The hospital’s community campaign raised more than $1.2 million, spokeswoman Pam Thompson said. But that’s not enough to build a new facility, she said. Those dollars, she said, would help the hospital secure grants and show lenders the hospital has community support.

The hospital isn’t just focusing on cost cutting, McGough said. Officials said they are evaluating every part of the organization for efficiency, as well as concentrating on customer service.

“I like that you’re addressing care and efficiency because that’s more important than the facility,” Willams said.