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HomeMy WebLinkAbout1993-03-18 Special Meeting NEW HANOVER COUNTY BOARD OF COMMISSIONERS JOINT MEETING WITH HOSPITAL BOARD, MARCH 18, 1993 BOOK 23 PAGE 380 ASSEMBLY The New Hanover County Board of Commissioners held a Work Session with members of the New Hanover Regional Medical Center Board of Trustees on March 18, 1993, at 6:00 P.M. in the Conference Room of the hospital, 2131 South 17th Street, Wilmington, North Carolina. Members present were: Commissioners Sandra Barone; WilliamA. Caster; William E. Sisson, Jr.; vice-Chairman E. L. Mathews, Jr.; Chairman Robert G. Greer; County Manager, Allen 0' Neal; County Attorney, Wanda M. Copley; and Clerk to the Board, Lucie F. Harrell. Chairman Greer called the meeting to order. Mr. Eugene A. Lees, Chairman of the Hospital Board of Trustees, welcomed the Commissioners and stated the Trustees have been looking forward to this meeting in order to present a report on the activities of the New Hanover Regional Medical Center. The philosophy of the Board of Trustees and Administrative Staff is to make decisions that are in the best interest of the hospital as well as the community. New Hanover Regional Medical Center is one of the best hospitals in the State of North Carolina and the Trustees are proud of this accomplishment. Also, the purpose of the meeting is to open up better communications and to discuss concerns expressed by the Board of County Commissioners. PRESENTATION ON THE ACTIVITIES OF NEW HANOVER REGIONAL MEDICAL CENTER The mission statement of the hospital is as follows: New Hanover Regional Medical Center is a team-centered, value-focused, teaching provider of quality health care to all in need of its serVlces. The following facts were presented: -568 beds, plus 60 approved rehabilitation beds. -The second largest employer in the County with 2,500 employees, 300 physicians, 750 volunteers and one of the 10 largest hospitals in the state. This is the only major high- tech, teaching medical center within 100 miles. The hospital has a sizeable economic impact on the County with a $74,000,000 payroll encouraging local purchasing and stimulating business for local contractors and vendors. -Clinical facts were presented on inpatient serVlces, outpatient services, and other services. The operational structure of the Hospital Board of Trustees was presented with a list of the various committees and Trustees appointed to those boards. Emphasis was placed on the need to have at least 15 members on the Board of Trustees in order to carry out the many responsibilities that are required for the operation of an efficient and effectively managed regional hospital facility. It was the consensus of all present that 15 members are needed to serve on the Board as well as on the eight working committees. KEY TOPICS: Rehabilitation Hospital: Groundbreaking scheduled for Spring 1993. Opening schedule for the Summer of 1994. The facility is an $11 million investment. New Hanover Community Health Center: To provide care access to medically underserved areas. The hospital is committing to funding of $1 million for building construction. NEW HANOVER COUNTY BOARD OF COMMISSIONERS JOINT MEETING WITH HOSPITAL BOARD, MARCH 18, 1993 BOOK 23 PAGE 381 Revenue Bond Issue: down as follows: $16 million revenue bond issue broken Rehabilitation Hospital NHRMC Energy Plant Improvement New Hanover Community Health Center $11 million $ 4 million $ 1 million After review, there are $9 million of additional needs broken down as follows: Energy Plant Improvement/Phase 2 Parking Garage Replace Pneumatic Tube System $ 5 million $ 3 million $ 1 million Master Engineering Plan: It improve the 25-year facility current code requirements. investment. lS necessary to upgrade and to meet existing needs and This will be a $9 million Parking: Surface parking additions at Glen Meade and MRI parking lots. Sixty employees will be relocated to Long Leaf and Canterbury malls. Displace physician parking and consider a parking garage. Other on-golng lssues that must be addressed as follows: -Clinical Issues -Uncompensated Care -Charges/Cost Shifting -Competition -Planning/Public Relations -Borrowing/Revenue Bonds -Cash Reserves -Total Quality Management Discussion was held on the items of concern expressed by the Board of County Commissioners in the letter of March 17, 1993. The following items were discussed: TERMS OF TRUSTEES: Twelve members of the Board of Trustees are appointed by the County Commissioners to serve a five year term with no one serving more than one consecutive full term without a break of at least one full year. The Commissioners would like to reduce the terms to three years with no one being able to serve more than two consecutive full terms. Also, the Commissioners want authority to remove a Trustee upon a unanimous vote by the Board of County Commissioners. Mr. Lees reported that the Trustees do have a great deal of concern for reducing the term from five to three years. Due to the complexity of operating the hospital, at least two years is required for a new Trustee to become familiar with the hospital operation; therefore, only one year remains for a member to effectively serve as a Trustee before having to apply for reappointment with the possibility of not being reappointed. It would be difficult to visualize anyone being able to perform as Chairman with only three year terms. Commissioner Caster reported 95% of persons requesting to serve a second term are reappointed; therefore, he does not feel reducing the term to three years would be a problem. Mr. Lees commented on County Commissioners being elected every two years and stated the possibility does exist that future Commissioners may not desire to reappoint persons to serve a second term, which would be detrimental to the hospital. If the terms are reduced from five to three years, there should be a mechanism ln place whereby an individual serving on the Hospital Board of NEW HANOVER COUNTY BOARD OF COMMISSIONERS JOINT MEETING WITH HOSPITAL BOARD, MARCH 18, 1993 BOOK 23 PAGE 382 Trustees making a significant contribution could be appointed to serve three terms. Chairman Greer reported on the need for the Board of County Commissioners to have authority to remove a Trustee by unanlmous vote. The physicians and Trustees expressed concern for politics becoming involved in the removal process and emphasized the importance of Trustees not feeling they can be removed for poli tical reasons. Concern was also expressed for the Commissioners becoming involved with increasing hospital rates during election years. Commissioner Barone reported the Commissioners are not interested in becoming involved in the day-to-day operation of the hospital; however, the Commissioners would like to be informed when rates are going to be increased. Commissioner Sisson reported a problem would have to exist before the Commissioners would unanimously vote to remove a Trustee. In his opinion, no Board of Commissioners would consider this action unless it was necessary. Presently, if a problem does exist with a Trustee appointed by the Board of County Commissioners, this member cannot be removed without a recommendation from the Hospital Board of Trustees. The purpose of this request is to give some control to the County Commissioners as well as bring this board into uniformity with all other boards appointed by the County Commissioners. Emphasis was placed on the fact that the County Commissioners must answer to the public and consideration must be given to their concerns. Without the confidence and support of the public, the hospital will not continue to grow. Mr. Lees stated, ln his opinion, if the Commissioners feel a Trustee should be removed, a letter from the Chairman to the Hospital Board of Trustees would greatly influence the Trustees and this action would probably be recommended because of due cause; therefore, the proposed recommendation is not needed. Commissioner Barone reported on the David Plate and the request made by Commissioners for clarification of events about this action. Unfortunately, the recelve an answer. recent situation with the Board of County that happened to bring Commissioners did not Mr. Lees reported the hospital attorney advised the Hospital Board of Trustees not to disclose information since this was a legal matter. Commissioner Barone reported the public did not buy that answer. Mr. Lees stated the proposed changes will requlre amending the By-Laws; therefore, no decisions can be made until the entire Board of Trustees has acted on these proposals. He recommended that Jim Hobbs and Allen O'Neal work on the comments received with these items being presented to the full Board of Trustees at a later date. Chairman Greer stated these lssues can be discussed and hopefully worked out to everyone's satisfaction. For example, the Commissioners have not indicated that once a Trustee serves two terms, that he cannot serve again. It could be possible that once a Trustee has served two years, that a person could be appointed to serve another term without a break of at least a full year. NEW HANOVER COUNTY BOARD OF COMMISSIONERS JOINT MEETING WITH HOSPITAL BOARD, MARCH 18, 1993 BOOK 23 PAGE 383 After further discussion, it was agreed that the Hospital Committee would work on a proposal for the terms of Trustees which will be discussed at a later date. The Hospital President and County Manager are to work on a proposal for removal of a Trustee upon a unanimous vote by the Board of County Commissioners. RENT: The current annual rent for the hospital building and grounds is one dollar ($1.00). The Commissioners would like to increase this amount equal to the debt service payments on the County's outstanding general obligation bonds issued on behalf of the hospital. Mr. Lees expressed concern for these costs being shifted to paying patients. This in essence means this cost has been removed from the general tax base with paying patients, who are also taxpayers, receiving the burden of payment. Mr. Jim Eyerman, the Hospital Finance Officer, reported refinancing the general obligation bonds would remove this debt service from the tax rolls and place this debt under the revenue bonds at the hospital which will save approximately 2%. Bond Counsel has no problem with refinancing the general obligation bonds with the revenue bond issue. By proceeding with this process, everyone will save money. Consensus: After further discussion, it was generally agreed that refinancing of the general obligation bonds to debt under the hospital revenue bond issue would be an ideal way to proceed if the hospital is comfortable with repayment of the bonds and all legal requirements have been met. TERMINATION OF LEASE: The current lease between the County and New Hanover Regional Medical Center requires that the County give 120 days written notice of intent to terminate the lease and that such notice shall be given after a public hearing. The Commissioners would like to amend the written notice to 90 days without a public hearing being required. Also the Commissioners would like to amend the current lease to specifically state that in the event the lease is terminated, all the real and personal property (real estate, equipment, cash, etc.) will be owned by New Hanover County. Mr. Lees inquired as to the benefits received from reducing the written notice of intent to terminate the lease from 120 days to 90 days; the benefits derived from not holding a public hearing; the legal implications; and the impact of the County assuming financial obligations related to property and leased equipment? Commissioner Sisson, agaln, reiterated the importance of standardizing the hospital lease with other County leases and stated the terms should be the same for all agencies. The recent lease with the North Wilmington Fire Department was certainly indicative of the need to respond quickly with terminating the lease under the 90-day written notice requirement and was most beneficial to the County in this instance. No one ever thought this problem would occur at the North Wilmington Volunteer Fire Department, but it did. Mr. Lees stated the Hospital Board of Trustees and County Commissioners should be able to resolve any critical issue in an expedient manner; therefore, he does not see the need to reduce written notice of termination from 120 to 90 days. Vice-Chairman Mathews stated the purpose for the reduction of written notice is that the Board of Trustees and Board of County Commissioners have had problems with resolving matters in the past year. NEW HANOVER COUNTY BOARD OF COMMISSIONERS JOINT MEETING WITH HOSPITAL BOARD, MARCH 18, 1993 BOOK 23 PAGE 384 Hospital Attorney, Dumay Gorman, recommended a thorough study of the reversion of real and personal property to the County. If the Commissioners decide to move in this direction, this issue must be thoroughly reviewed to see how this process should occur. When all hospital assets are reverted, the liabilities are also reverted back to the County; therefore, this item needs to be studied. Possibly, things should remain as written in the lease with the corporation not being able to transfer these items without approval by the Board of County Commissioners. County consider: property; property. Attorney Copley stated there are two issues to (1) if the hospital dissolves, what happens to the and (2) if the lease is terminated, what happens to the Chairman Greer reported on the example at the North Wilmington Fire Department, where taxpayers paid for equipment, and due to the lease not specifically stating the equipment should revert back to the County this money was lost. Speaking for the County Commissioners, if the hospital lease should be terminated, the Commissioners want assurance that the taxpayers will be protected and are not left without anything, such as no hospital, no money, or any other assets. This is the purpose for the request. Discussion was held on removing the requirement for the public hearing. Chairman Greer stated, in his opinion, he has no problem with holding the public hearing or reducing the lease from 120 to 90 days; however, he feels strongly about the lease specifically stating that all real and personal property should revert back to the ownership of the County if terminated. County Attorney Copley reported the Commissioners have two reasons for requesting that the written notice for termination of the lease be reduced from 120 to 90 days: (1) the need to act quickly; and (2) the uniformity of all contracts. As to the holding a public hearing, the Commissioners feel they should have an option to decide whether or not to hold a public hearing. If a public hearing is required and the public demands that the lease be terminated immediately, the Commissioners would have a difficult time going against the wishes of the public. Chairman Greer reported that in most public hearings you hear only one side, without hearing from the other side. Commissioner Sisson inquired as to whether the reduction of written notice to 90 days is a real problem with the Board of Trustees. Mr. Lees stated, in his opinion, the reduction of written notice could possibly be negotiated as well as the requirement for holding a public hearing; however, these proposals will have to be presented to the full Board of Trustees. After further discussion of the present lease, it was generally agreed to proceed with a proposal to reduce the written notice of termination from 120 to 90 days; and delete the requirement for holding a public hearing. It was also concluded that the attorneys should prepare a proposal or provision that will revert the property back to the County if the lease is terminated. Charitable properties will be addressed in this proposal. Both boards will discuss these proposals and present recommendations to each other within the next month. ADJOURNMENT Vice-Chairman Mathews reported on the need to hold more joint meetings with the full Hospital Board of Trustees and recommended scheduling meetings in January and July of each year. NEW HANOVER COUNTY BOARD OF COMMISSIONERS JOINT MEETING WITH HOSPITAL BOARD, MARCH 18, 1993 BOOK 23 PAGE 385 Consensus: After discussion of the need for better communications between the two boards, it was the consensus of those present to schedule a meeting in six months. Chairman Greer, on behalf of the Board, expressed appreciation to the members of the Hospital Board of Trustees for inviting the Commissioners to meet. Appreciation was also expressed for the excellent job performed by the Hospital Board of Trustees in overseeing the operation of this outstanding medical facility. The meeting was adjourned at 8:36 P.M. Respectfully submitted, Lucie F. Harrell Clerk to the Board ~ MINUTES OF JOINT MEETING WITH HOSPITAL BOARD OF TRUSTEES, MARCH 18, 1993 PAGE 385 Consensus: After discussion of the need for better communications between the two boards, it was the consensus of those present to schedule a meeting in six months. Chairman Greer, on behalf of the Board, expressed appreciation to the members of the Hospital Board of Trustees for inviting the Commissioners to meet. Appreciation was also expressed for the excellent job performed by the Hospital Board of Trustees in overseeing the operation of this outstanding medical facility. The meeting was adjourned at 8:36 P.M. Respectfully submitted, ~~#~ Lucie F. Harrell Clerk to the Board ~ . . .