Down the home stretch on hospital privatization

It may seem like it has taken forever, but the more than 18 months of work setting up the privatization of city-owned Hutchinson Area Health Care appears to be on the cusp of completion.

A quintet of resolutions and ordinances related to the privatization are on the agenda for the Hutchinson City Council’s Aug. 28 meeting.

The ordinances include one approving the lease of the hospital’s property, including Burns Manor, to the new nonprofit Hutchinson Health Care, and another for the nonprofit’s articles of incorporation and bylaws.

Resolutions awaiting council consideration are ones covering a debt service agreement with the nonprofit, ground rules for the hospital’s use of City Attorney Marc Sebora for some business, and an agreement on determining the value of the hospital’s property.

Conditions of the agreements assure Hutchinson residents their city government keeps an interest in the community’s health care facilities. A key component empowers the council to appoint a minority of an odd-number board, with up to two council members. The nonprofit’s board will be structured so that a majority of representatives will be Hutchinson residents.

Hutchinson also is to receive an annual lease payment, said last month to begin at $160,000, plus debt service. The lease payment, the council was told, will increase 5 percent a year for 30 years. The city will receive about $10 million over the life of the lease. At the conclusion of the lease, the nonprofit has an option to buy the hospital’s assets for $1.

The city retains a permanent right to approve any sale of the hospital to a third party, and will also receive proceeds of such a sale. The city would take over the hospital if the nonprofit dissolves for any reason.

Also on the agenda is a proposal to limit the use of all-terrain vehicles within city limits to conditions similar to those followed by snowmobilers. Generally, ATVs users would have to take the most direct route from their home to a point outside city limits. ATVs would be prohibited from sidewalks, boulevards, parks, school property and golf courses.

The meeting is at 5:30 p.m. in the council chamber of City Center, 111 Hassan St. S.E.

(Terry Davis is a staff writer for the Hutchinson Leader. He can be reached at davis@hutchinsonleader.com.)