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Public forum on Measure B held in Quincy

Linda Satchwell
Staff Writer
8/4/2010

The Measure B forum held by the League of Women Voters July 29, at the Veterans Hall in Quincy was notable for a couple of things: its civility considering the contentious nature of the debate on this measure, and its lack - for the most part - of new questions or ideas.

Measure B proposes to cap the hospital tax at $50/$100,000 assessed value.

Every facet of this debate, which has hit voters and taxpayers hard in their minds and pocketbooks, has been discussed and argued already.

Because the tax cappers were discussing the issue with fellow citizens in the Save Our Hospital group, rather than the board and administration of Plumas District Hospital, the debate was calmer, less extreme and, while each side showed its areas of entrenchment, they also showed sincere interest in this community and in the fate of its hospital.

Jane Braxton-Little of the League of Women Voters moderated the forum, and Nancy Lund was the timekeeper. Braxton-Little introduced the pro-Measure B $50/100K members as Bob Herr, private citizen and taxpayer, and Skip Alexander, private citizen and taxpayer.

Peter Hentschel, attorney, and Bill Coates, former supervisor and businessman since 1974, represented the Save Our Hospital group.

Opening statements presented the mantra that each side would intone for the rest of the evening, with some slight, but interesting variations.

Skip Alexander opened by saying, as he has many times before, that the hospital had "taken advantage of" taxpayers when they put together Measure A, that the tax was "excessive," and finally, that "the hospital won't close."

Hentschel and Coates, on the other hand, maintained an absolute certainty that the death of Measure A would mean the eventual death of the hospital. Hentschel pointed out that the hospital can't purchase bonds if there is a cap on the tax, because the bonds couldn't be guaranteed.

Further, Measure A money was raised specifically to pay for the new hospital building; it can't be shifted to pay for upgrading the old building. If Measure B passes, then, "it will devastate healthcare," said Hentschel.

Coates expanded on the hospital's demise theme by saying PDH was down three doctors already, and it had been unsuccessful in recruiting new physicians over the past three years.

Coates also said repeatedly the community has been strong for 160 years, having weathered both natural and economic disasters. To his mind, what's been behind that strength is the way this community has always bonded together in times of need.

He said, further, that he'd hoped for a Quincy Library Group-type of discussion with the tax cappers, but this hadn't happened.

Coates is also one of the prime movers behind the recent board meeting decision to make $125/$100,000 of assessed value its upper limit.

Coates' group consulted with bond counselors and state financial managers in coming up with a figure they feel is viable in two ways: It will cover the cost of bonds if the hospital gets the USDA loan they've applied for - currently at 4.0 - 4.5 percent. In addition, it is an amount they feel, after talking to a large number of district taxpayers, that is affordable.

The July 15 special board meeting where PDH's board hammered out the language of this agreement with members of the SOH group was one of the points of contention for the pro-Measure B group at the forum, however.

They said the reason they were conspicuously missing from that meeting was that no one had told them it was occurring.

To the Measure B proponents, the meeting appeared to a planned effort to keep the Measure B group away as the Save Our Hospital group worked with the hospital board.

It was pointed out in this newspaper, the Measure B group could request PDH notify them of special meetings via email. not sure what this has to do with anything in the forum discussion

On the other hand, when one questioner asked how the $50/$100,000 amount had been chosen, Alexander explained it had been figured by taking the $87 estimated high tax, and working out that at a 2 percent inflation rate, $50 now would equal $87 in 30 years, at the back end of the loan.

Herr said, "Of course, part of the problem is that bond payments or taxes are front loaded. The $87 high actually comes very early in the life of the bond, then declines from there."

That statement put a dent in the reasoning behind the $50 figure. When another questioner noted even some tax cap proponents were beginning to admit $50 was too low a figure, Alexander said he hadn't heard that.

In addition, Alexander raised the specter of a Measure C. He said if the money raised can't be used to fix the existing hospital, then "maybe they need to come up with a new measure to let that happen."

PDH will find out at the end of September whether it will receive the low interest USDA loan; however, the cap would effectively kill that possibility, said Hentschel and Coates.

When asked what solution the tax cappers have to the hospital's problems, Alexander said "I don't know ... the hospital should figure it out."

Hentschel countered the board had spent the past 10 years doing just that, and the much reduced new hospital building paid for by Measure A was their long considered answer.

Coates said, "It's up to us to figure it out," reminding the audience repeatedly that PDH is "our hospital."

Alexander responded that the "$125/$100,000 doesn't sound good and it's not guaranteed."

Hentschel explained, "with the benefit of hindsight," the SOH group could ask a lot of questions and do research to develop their figures.

"We're comfortable with the numbers. We're satisfied that you'll not pay more than $100/$100,000 average over the life of the bond."

Coates said his group did the research and brought these figures to the board "because we were afraid to lose the hospital. We came up with a plan," adding they'd repeatedly asked the Measure B group to offer a plan, but they hadn't done so.

Alexander said he didn't trust the $125 figure, and that PDH has "said the same thing before."

Given the dismal economy, he said, "maybe we need to stop with this until people get their jobs back."

Herr, however, said he thought the USDA loan was a good idea, and the board should have been looking at this from the beginning.

Herr pointed to a recent downturn in the hospital's financial picture, saying they'd experienced a "$502,000 operational loss" and a "$250,000 net loss."

Alexander also hit the figures, saying that according to County Assessor Chuck Leonhardt, assessed values were likely to be lower by about 5 percent countywide.

This, he said, "drags the assessed value pool down," though Leonhardt was estimating that "Quincy is up 1 percent."

When contacted, Leonhardt said the actual figure is worse - the countywide assessment is down by 8.3 percent.

Shawn Montgomery, Auditor, said Plumas District Hospital's secured roll assessment was down 4.8 percent from last year. She said that it usually goes up 2 percent, so this marks a 6.8 percent drop.

She and Leonhardt agree this is a historic decline.

Moreover, Alexander said if the assessed value pool goes down, the hospital couldn't borrow as much money. Already they'd cut the amount from $17 million to $15.3 million, since the district can only borrow up to 2.5 percent of the assessed value of the district.

"Where," asked Alexander, "is the extra money going to come from?"

Coates replied the hospital needs $21 million to build. "If we get 15.3 million [in USDA bonds], and $4 million in revenue bonds from PDH's revenue stream and then the rest from fundraising. We'll just ante up."

Herr and Alexander suggested PDH might consider a takeover by a larger hospital. He said PDH would be a great asset and a buyer could be told they'd have to build a new hospital building here.

Coates said giving up local control inevitably means the larger institution only does for the local hospital what benefits the takeover hospital - such as increasing referrals - and that eventually it would close PDH.

In closing statements, Coates reiterated points he'd made during the forum, He added a poignant personal note, however. "I lost my son, Brady, on an ambulance ride," from Brownsville/Halsey in Oregon on the way into Eugene.

Coates said he would have paid any amount of money to have a hospital nearby. "We are better than this, please. Let's save some lives."

Herr had the final word of the evening. "No matter what the outcome of the election, we, the property taxpayers and the supporters of Measure B have already won.

"Why do I say this? If it wasn't for Measure B, the hospital would not have set a cap. Finally, two weeks prior to the election, they did.

"Second, if there was not the public outcry and we had not suggested the USDA loan option, the hospital was intending to lock in the remainder of the bonds at a 7 percent rate and a cost to the taxpayer of more than $350,000 a year.

"What we really need at this time is a cooling off period. In November, we will have a new hospital board. If the current hospital CEO's contract is not renewed, we will have to search for a new one. He or she will have fresh ideas, and we need to listen.

"We cannot afford to be a community divided. We need to take the time to see if we can unite for a common cause. Measure B will allow time for this to happen. It will provide plenty of money for the bonds already issued. It will put the proposed building on hold and provide the time to investigate any or all of the options we have talked about tonight."

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