Health District approves $400K revenue bond

The San Juan Health Service Board faced a number of questions about a proposed bond at an August 25 public hearing.
The health service district is considering a $400,000 revenue bond that will be used to purchase patient care equipment for San Juan Hospital, including a lab chemistry analyzer, computerized pharmacy information system, an autoclave sterilizer, two anesthesia machines and surgical instruments.
The $800,000 in equipment would be funded fifty percent by the bond and fifty percent by a grant through the Utah Community Impact Board.
The first question was raised by board member Toni Turk, who asked if it is procedurally correct to hold a public hearing after action has been taken on a proposal.
The board voted to proceed with the bond at a July 7 meeting. A public hearing scheduled on July 7 was delayed to August 25 because of problems with notification.
Hospital administrator Phil Lowe said he would look into Turk’s question. Lowe stated that the district followed the recommendation of legal council in delaying the hearing and in voting on July 7.
In the public comment portion of the meeting, Neil Joslin expressed concern about the amount of debt carried by government entities. “The last thing the taxpayers need is more debt,” said Joslin. He suggested that the district wait rather than move forward with the bond.
Board member Gail Johnson stated that the bond is a revenue bond, not a general obligation bond, which limits the liability to taxpayers.
Board member Steve Simpson expressed support for the bond. Simpson said, “The purchase of this equipment will help make the district more financially viable, not less. If you look at the financial statements, you will see that this is born out.”
Construction is progressing on the new clinic facility adjacent to San Juan Hospital. Lowe reports that the district plans to move into the new clinic and host an open house in October.
In addition, a 2,000 square foot addition to the hospital will be complete in November. The addition will expand the hospital lab and the dietary services, including a new walk-in freezer.
The clinic and hospital expansion is funded, in part, by a $1.2 million bond issued by the health service district in 2010. In addition, the district added $500,000 in debt in 2009 during a multi-million dollar surgical suite expansion and remodeling project. Total grant funding for the projects has been approximately $3 million. The total debt for the projects has been approximately $2.1 million.
Lowe said the health service district recently completed an audit of clinical services. He said that auditors found not a single deficiency in the review, which occurs every three to five years.
“In my more than 20 years in health care, this is the first time I have heard of an audit with no deficiencies,” said Lowe.