Northwest Colorado Visiting Nurse Association officials said they would research whether the organization legally has to move its offices after The Memorial Hospital last week gave it six months to vacate the building.

The Memorial Hospital asked the association to leave the 745 Russell St. building as part of its efforts to make better use of hospital building space, save money and restructure.

Hospital officials announced the major restructuring last week as they work to improve the hospital’s financial position and build a $19 million facility.

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Although the groups work closely together, the association, a nonprofit that offers community health services, isn’t affiliated with the hospital.

The history

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In 1997, the hospital and the county built the Russell Street building to house the association. The building is next to the hospital.

VNA officials last week said they were surprised by the hospital’s decision.

Hospital officials say they can get an additional $98,000 in Medicaid reimbursements by moving the Valley Health Center, located in the hospital’s basement, into the association’s offices. The hospital has offered the association space in another building.

‘Pretty unusual’

But Association Director Sue Birch said she thinks the Russell Street building was constructed specifically to house the association.

Grant funding and a bond were issued for constructing a building to house the association, Birch said.

“The community invested in the building as a permanent home for the VNA, and the VNA took it on as a permanent home,” she said.

Alan Matlosz, with George K. Baum and Co., which handled the bonds, said bond sales for construction rarely specify a lessee.

“It would be pretty unusual for that to happen,” he said. “If (the hospital) obligated that space to the visiting nurses, it wouldn’t be in the bond documents, it would be a separate agreement or contract.”

Official statements

According to a Sept. 18, 1995, bonding company official statement, proceeds from the bond sale were to be used to “finance, in part, the cost of construction of a new facility adjacent to the hospital’s existing facility.”

A single section of the paperwork refers to the association, and states “upon completion, a portion of the construction project will be occupied by Northwest Colorado Visiting Nurse Association.”

Matlosz said the official statement is a marketing tool and is not legally binding.

A portion of the bond proceeds also were used to repay other county-issued bonds. Only $325,000 of the $1.03 million bond revenue was used for construction of the building, Matlosz said.

The hospital contributed more than $565,000, and the Colorado Department of Local Affairs contributed $640,000 to the $1.7 million construction project.

The provisions of the local affairs grant have expired, hospital spokeswoman Pam Thompson said.

Next steps

The association’s board of directors formed a committee to address its options shortly before the hospital’s announcement Thursday. The board met once before the announcement, but the discussion was largely based on the building’s history, board member Jeannie Thornberry said.

“We had more questions than anything,” she said.

The committee also discussed whether the building could be purchased or whether the association could make the full payments with an option to purchase the building or a portion of the building.

“If the VNA absolutely doesn’t want to move, we have to help the hospital meet its bottom line,” Thornberry said.

Keeping the building open costs the hospital $128,000. The association pays $31,270 of that amount in rent. Moffat County makes that payment to help meet its legal obligation to provide public health services.

By contracting those services, the county saves money, Birch said. In addition to making the association’s lease payment, Moffat County contributes $100,000 to the association’s $3 million budget.

Thornberry said her main concern is the cost of moving association offices.

“The VNA is always looking for money. We’re always struggling,” she said.

Thornberry said she hopes the subcommittee will be able to present some preliminary options at the board’s Nov. 30 meeting.

“I’m confident that between the county commissioners, the hospital, the community and the VNA, we can come up with a solution,” Birch said.

She already has begun re—-searching sources that would fund the purchase of the building and is accepting community donations.

“We’re very artful at raising state, federal and regional support for the services we offer,” she said. “We’re very committed to Moffat County, and we will continue to have a presence in Moffat County, whether we secure the current facility or find another one.”

The Moffat County office of the association has served more than 10,000 residents to date.

Christina M. Currie can be reached at 824-7031, ext. 210, or ccurrie@craigdailypress.com.