The City of Pineville has decided to bring an end to its efforts to fund the hosptial.
For nearly three months the city has used borrowed funds to help the hospital meet its payroll and keep its doors open. But the Mayor Scott Madon told the council on Tuesday that it has reached the point where they can no longer borrow money without putting the city at risk.
“The city has borrowed all it can. We’re currently $1.2 million into this project,” he said. “We’ve borrowed all that we can.”
The plan was for a new owner to be place this week after the hospital was put up for auction. The city even entered the bidding to keep all of the hospital’s assets together but a higher bid came in from Cura Healthcare, Inc., for $7 million. However, has Cura failed to make its 20-percent cash deposit in accordance with the sale order, in the amount of $1,400,000.00, but they have until August 16, 2019 to make good for the final settlement and payment of the total sales price.
With no financial assistance from the city and guarantee that the high bidder will come through, the hospital is facing an uncertain future.
“We are working to keep the hospital open, but we face the possibility of making tough decisions over the next couple of days,” hospital CEO Kevin Couch told The Pineville Sun via text message between meetings Wednesday morning.
Employees were informed that the city was pulling out at a meeting Tuesday afternoon. Several of them carried signs asking for support outside the hospital on Wednesday.
They were joined by Dr. Velupillai Wignakumar, a general surgeon at both Pineville and Barbourville hospitals.
“All of these people are working without any salary or any wages. But they are here because they want to keep the hospital open,” he said. “We do not have any clear directions from the bankruptcy or the potential buyer on who’s going to take it on board and run it. That is the problem right now.”
State Representative Adam Bowling also came to Pineville to speak to the protesting employees.
“Without these employees and what the City of Pineville has done, this place would have been closed down months ago back in May. We definitely appreciate everything they have done,” Bowling said. “Basically, with bankruptcy court there’s only so much you can do. But I did feel like it was important for me to be here today just to show them support and let them know that I stand behind them 100 percent. Even though we’ve had a setback we’re not going to give up on them.”
Madon stressed that the city was not making a decision to close the hospital.
“The hospital board will be the ones to make that decision. I’m the chairman of that board and I can’t speak to what they might decide,” he said.
During Tuesday’s meeting Madon apologized for getting the city involved in hospital situation.
“I think it would have been pretty bad if we had sat back and just let it close (in May). It’s a very stinging, hard financial lesson for us to learn but we will recover,” Madon said. “I thought at one time we were going to be able to jump the hurdle but at this time it doesn’t look promising.
“I wish the high bidder the best going forward and if they don’t buy it hopefully Kentucky Highlands and the bank can get somebody to buy it and do something with it.”
As far as the city paying pack the money it had borrowed to keep the hospital going, Madon said he didn’t think tax would have to be raised. Instead the money could be paid back through long-term loans and a bond issue.
“Another reason we’ve got to stop putting money into the hospital is our $5.5 million project around courthouse square. If we kept going the way we were going we could have put that in jeopardy. We may try to roll this in to the bonding issue for that project,” he said.