Clayton County’s efforts to bail out its ailing hospital is turning into an expensive proposition for taxpayers.
The county decided Monday to borrow $75 million from PNC bank, days after commissioner Sonna Gregory questioned how the lowest bidder — Wells Fargo — became a finalist since it was the employer of another commissioner Michael Edmondson.
Picking PNC means Clayton taxpayers will pay nearly $403,000 more in interest over the next six years. The county’s chief financial officer Ramona Thurman said paying out that extra money will eat into the cost of other county projects slated to be funded by a special local option sales tax known as SPLOST. Residents voted in May to extend the SPLOST for six years to cover county projects and to help Southern Regional Medical Center.
Concerns over Wells Fargo and the appearance of a conflict of interest, however, led the five commissioners during Monday’s special-called meeting not to even consider the bank for the bond deal. Instead, commissioners — including Edmondson — voted to investigate whether the process was improperly influenced to favor Wells Fargo. It was noted during Monday’s meeting that Wells Fargo quoted lower interest rates than PNC.
Efforts to reach Gregory Monday were unsuccessful.
Commission Chairman Jeff Turner said he was satisfied with the decision to go with PNC even though it will cost the county more money. He also noted that he thought the selection process was “proper and in order” but anytime a commissioner raises concerns it has to be addressed.
“The interest rate is a little higher,” he conceded. “However, (going with PNC was necessary) to make everyone comfortable with their vote in order to pass this resolution. Had there not been a decision … Southern Regional would have had to close its doors in 30 days.”
Southern Regional chief executive Jim Crissey told commissioners before their vote “the hospital can not survive unless it receives supplemental funding.”
Edmondson, who abstained from the PNC vote Monday, told The Atlanta Journal-Constitution in an email sent before Monday’s meeting “I don’t mind if there is an investigation… However, I do not think there is much to investigate. The fact that I am an employee of one of the bidders really has nothing to do with anything. Nevertheless, this situation is exactly why our county’s ordinances provide for commissioners to abstain due to personal interest.”
Hampton resident Rae James attended Monday’s meeting and said she was “happy with the decision” to go with PNC despite the higher cost.
“Sometimes it’s not the dollar amount. You have to look at the human factor,” she said noting that her subdivision has had problems working with Wells Fargo. “I’m looking at how Wells Fargo has treated the African-American community.”
Given the current scrutiny of politicians in other counties over business dealings and ethics, Larry O’Keeffe of Rex said Clayton commissioners are “erring on the side of caution.”
“It’s a tough call. It sounds like everybody was open, proper and transparent,” said O’Keeffe who did not attend Monday’s meeting. “Sometimes to do things in the proper fashion you’re going to pay the price.”
The county will close the bond deal with PNC Bank on Thursday.
About the Author
