Hospital inks loan deal with USDA

<I>Photo by Rocky Wilson</I><BR>Paul Kershisnik (right), of United States Department of Agriculture Rural Development said when Wallowa Memorial Hospital CEO Larry Davy signed the contract Monday that approval in Portland was a "mere formality" for an $8 million USDA loan to build a new hospital in Wallowa County. The USDA is also guaranteeing a $6 million loan which will be put out for bid.

The money to build a new hospital in Wallowa County has been approved and projections are to move into a new facility during fall 2006.

On Monday papers were signed by Wallowa Memorial Hospital CEO Larry Davy to borrow $14 million for the construction of a new hospital facility in northern Enterprise. The $14 million - $8 million in a direct loan from the Rural Housing Service of the USDA's Rural Development program and $6 million in a USDA guaranteed loan to be put out for bid - will be paid back in 30 years at no additional expense to county taxpayers.

The $6 million bid must be advertised on a regional basis, Davy said, meaning it will be advertised in Oregon, Washington and Idaho.

Davy said that the agreement with USDA Rural Development is that the total cost of the facility will not exceed $15.7 million, with the balance being paid for by the Wallowa County Health Care District. USDA Community Programs Specialist Paul Kershisnik of Pendleton said the interest rate on the loan will be locked in at 4 3/4 percent or lower.

The Wallowa County Health Care District has been investigating options to construct a new hospital since a Department of Human Services survey funded by the Oregon Rural Hospital Association in Nov. 2002 determined that the 50-plus year old hospital would soon be out of compliance with state codes and might soon be closed. At that time it was the second oldest hospital in Oregon.

At Monday's signing the hospital's head of maintenance, Dan McCarthy, talked about the problems associated with the 50-year-old plumbing and electrical wiring in the current facility.

Kershisnik said the money would be available Sept. 22. Davy said the Wallowa County Health Care District Board would meet Sept. 27 and at that time was expected to vote to accept the loans.

Davy said that, if road design work is completed and weather permits, efforts will be made this fall to build the access road along Flora Street in front of Les Schwab Tires to the property. Also waiting for building access on that road is a nearly $1 million public safety building.

Final schematic design work with architect Clark Kjos Architects of Portland is expected for completion in the next two weeks, Davy said, with discussions held through the winter months as to specifics for the interior of the one-story facility. Groundwork is expected to begin in the spring of 2005 with completion projected 12 to 16 months after the starting date.

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