Will Measure J Save Southern Inyo?
The Board of Trustees for the Southern Inyo Hospital District have placed a parcel tax increase on the ballot for a special election scheduled on April 10, 2018. If approved by two-thirds of voters, Proposition J will add an additional $215 parcel tax to all property in the Southern Inyo Healthcare District which, according to its supporters, will allow the District to pay off its bankruptcy debts and re-invest in existing buildings and facilities.
SIHD is also considering floating a bond measure to pay off its outstanding debts. The proposed parcel tax revenue, if approved, would be used to pay off the bond.
Proposition J is expected to raise around $600,000 a year for 15 years, or around $9 million over its term. However, even the hospital’s most ardent supporters admit it’s going to be a tough sell.
The tax revenue from Measure J is critical to the success of the Chapter 9 bankruptcy proceeding currently before the California Eastern Bankruptcy Court. The District must show that it can pay off its debts and provide a viable business plan that assures its continued existence. Skeptics of the tax say that, unless the Board looks to alternatives such as eliminating Emergency Room Services, which currently cost the hospital $1 million a year, nothing is likely to change.
Larry Kraus of Darwin and Doug Thompson of Lone Pine said SIHD should provide a full account of its true financial situation before asking the public to support a parcel tax increase.
SIHD is unable to provide that information because Health Care Conglomerates Associates (HCCA), which was contracted in 2016 to manage the failing hospital, has failed to provide timely financial reports and records.
According to the SIHD board, HCCA facilitated questionable financial transactions between SIHD and the Tulare Regional Medical Center (TRMC), another failing hospital with which HCCA had a management contract. TRMC closed its doors in 2017 and is also in bankruptcy proceedings. It has filed a claim against SIHD for $2.5 million, alleging that HCCA transferred some of its money into SIHD accounts.
Southern Inyo Hospital was forced to close in December, 2015. At that time, all of its Board members resigned. A new Board was appointed, and filed for bankruptcy protection in January 2016. Having heard of the success of HCCA in turning around the TRMC, the new Board contracted with them to reopen the hospital and skilled nursing facility. The Board’s confidence in HCCA faltered when it heard of TRMC’s collapse in 2017.
