Officials will go over details for new hospital

• Election not tied to annual mill levy for support of the hospital, ambulance service and health clinics

Voters will have a chance Wednesday to hear about the proposal to build a new hospital, a project dependent on approval of a $25 million bond issue in the Nov. 8 general election.

Lincoln County Medical Center Administrator Todd Oberheu will provide a power point presentation and answer questions from 5:30 pm. To 7 p.m., in Room 4 of the Ruidoso Convention Center, 111 Sierra Blanca Drive.

Built in 1950, the LCMC is a county-owned hospital that has been leased and operated by Presbyterian Healthcare Services since 1972. The partnership operates the hospital, a primary and specialty care clinic, three rural health clinics and a countywide ambulance service. Presbyterian runs eight hospitals, has a statewide health plan and a growing multi-specialty medical group. The non-profit healthcare organization has been serving New Mexico since 1908.

Lincoln County commissioners approved putting the $25 million bond question on the ballot after hammering out a 30-year lease agreement with Presbyterian, which will produce more than enough revenue from the annual lease payment to cover the debt service on the bonds. The new rate does not kick in until construction of the hospital is completed, anticipated to take up to two years. The current rate is $1.1 million annually. The debt service is expected to be under $1.8 million annually, according to the county’s financial advisers.

The new lease amount of $3.2 million annually reflects the added value of the new hospital with $2.3 million coming in cash and $900,000 in documented uncompensated services, a breakdown reviewed by commissioners showed.

According to information provided by Oberheu, the hospital’s community board chairman Gary Mitchell, County Manager Nita Taylor and Commission Chairman Preston Stone, the new 70,000 foot, 25-bed critical access hospital is expected to cost $38.3 million. That figure includes $2.5 million to relocate and build a new emergency medical services (ambulance) facility; $8 million in furnishings and equipment; and $27.8 million in hospital construction.

“Voting in favor of the bond will not cause taxes to increase,” the jointly issued release to the Ruidoso News stated. “The bond is a financing mechanism and will be paid off by the county entirely through increased lease payments by Presbyterian.”

The bonds will be secured by existing property taxes as insurance should something change with the Presbyterian situation. Presbyterian will contribute $8 million to furnish and equip the new hospital. Lincoln County Medical Center Foundation officials have pledged to raise the remaining $5 million needed for the project.

Besides the increased payment, the new lease contains a penalty for late payments and a longer termination notification period.

“We are excited to be moving forward and believe hospital construction is necessary to uphold safe standards of care, maintain the joint Commission accreditation and to recruit and retain physicians in Lincoln County,” the letter stated.

The planned improvements include a modern emergency electrical system, updated intensive care rooms and a new mechanical system. The replacement option is less costly that repair and remodel of the existing facility and will create centralized parking for the entire campus, including the hospital, therapy center and medical complex, they said. A new hospital also can be built more quickly that renovation would take and will have less impact on the existing facility during construction. The site is in the area now occupied by the EMS.

The bonds have no effect or connection to the special annual property tax levy of up to 3 mills approved by voters in 2014 for eight years, which was a renewal of the mill levy to support the hospital, ambulance service and rural health care clinics that has been in place with previous voter reauthorizations since at least 1984.