Clayton County greenlighted a package of special tax-funded projects Tuesday night that, if approved by voters, would raise $50 million to help the county’s ailing hospital.
The projects would be financed with a 1-cent special purpose local option sales tax (SPLOST) that would collect nearly $218 million over six years for roads and building repairs, upgrades to public safety facilities and fleets, as well as technological improvements. But nearly a quarter of the money raised would go toward keeping Southern Regional Medical Center afloat.
The SPLOST package now goes to voters, who will decide on May 20 if they want another round of capital projects when many projects from two previous SPLOST campaigns haven’t been completed.
Before the commission’s 3-1 vote, the head of Southern Regional talked about the hospital’s struggle to deal with the escalating costs of indigent care. About 30 percent of the 80,000 visits to the hospital’s emergency room last year were people unable to pay, said James Crissey, Southern Regional’s president and chief executive.
The hospital has pledged to cut its expenses by $12 million a year and has asked the county to chip in $12 million. Crissey noted that a third of Georgia’s counties, including those in metro Atlanta, supplement local hospitals’ budgets to offset the burden of providing uncompensated care.
“Failure of Southern Regional would be catastrophic to Clayton County’s citizens and its economy,” he said.
If voters agree to the plan, proceeds from the SPLOST would be used to pay off the hospital’s bonds — around $45 million. The county’s help would be achieved through a complicated series of transactions involving real estate and bonds. For instance, Clayton would buy the property on which the hospital is located and lease the facility back to the hospital. The transaction would generate about $45 million, which would then be used to pay off the hospital’s bonds.
While the county appears to be on board with helping out the hospital, passing the package of SPLOST projects wasn’t a slam dunk. A couple of commissioners wanted the SPLOST vote to be delayed until November to give the hospital time to come up with a viable plan showing how it will fix its problems.
“The board needs to wait until there’s a long-term plan for Southern Regional to sustain itself,” said Sonna Singleton, who cast the dissenting vote Tuesday night.
Commission Chairman Jeff Turner said in an interview after the meeting that delaying the SPLOST vote would only aggravate the hospital’s problems.
“The hospital’s in dire straits. The more we sit around and wait, the (hospital’s) debt becomes a bigger issue,” he said.
Waiting until November would mean proceeds from the SPLOST would not be able to be collected until April of next year, Turner said. He also noted that even with SPLOST aid, “it’s a possibility that taxes may go up.”
Commissioners had hoped to get more of the county’s seven municipalities to chip in to help save the medical center. Only Riverdale and Lovejoy agreed to allow some of the money they get from the county from tax distributions to go toward helping Southern Regional. Riverdale has pledged $2.9 million while Lovejoy is chipping in about $600,000.
“I saw the plan for the (hospital’s) future to fix the problems so it won’t happen again, “ said Riverdale Mayor Evelyn Winn Dixon. “They have an excellent plan. So it was the right thing to do. We need the hospital. Our citizens need to have some health care and somewhere to go.”
With 1,850 employees, Southern Regional is one of Clayton’s largest employers, Winn Dixon noted. Its failure would create a devastating domino-effect in the county, she said.
The hospital has already begun the painful process of cutbacks. It recently cut 61 positions and laid off 43 workers, and it closed two sleep centers within the past couple of months, Crissey said.
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