St. Charles Parish voters will decide Saturday whether to renew an annual $2.9 million property tax millage that largely supports emergency services at the publicly owned St. Charles Parish Hospital.
The vote would extend an existing 2.48-mill tax for a decade, beginning in 2016.
The $2.9 million represents about 7 percent of the hospital’s expenditures, said CEO Federico Martinez Jr.
Martinez said the money would be used, in part, to add a third ambulance during peak hours, expand the 59-bed hospital’s emergency room, staff a new cardiology unit and pay for advanced cardiac-life-support training for the medical staff.
St. Charles Parish Hospital recently broke ground on a $15.5 million building in Destrehan that is slated to be completed by May 2015. It will house additional specialty physicians and urgent care facilities, as well as offices, an optometry center and a pharmacy, Martinez said.
The hospital’s millage was first approved by voters about three decades ago and has been renewed several times, although the length of each renewal and the amount collected has changed over the years.
A potential complicating factor this time is that a recent audit showed the hospital ended the past fiscal year with a $12.1 million cumulative debt. However, Martinez said he has received “good feedback” about the millage while making his pitch to residents in presentations at community meetings.
As costs of providing health care have risen nationwide in recent years, Martinez said, providing emergency services at the St. Charles facility would become a serious challenge without the stream of money the tax provides.
“I think all you’ve got to do is look around and see what health care looks like these days,” he said. “The health care industry is struggling, hospitals are struggling, and we’re one of the few parishes where EMS is part of the hospital. You don’t really find that too many places. We’ve tried to look at other ways to provide ambulance service, but the public has spoken very loud and clear: They want it to be part of the hospital.”
The owner of a $200,000 house with a homestead exemption would pay about $30 annually if the tax passes, while the owner of a $300,000 house would pay around $55.
The audit released by the state’s legislative auditor in March showed the hospital entered the last fiscal year with a $4.3 million debt, which grew during the year by $7.8 million, including about $4.7 million that went toward a lump-sum pension payment, the audit report said.
The audit also cited problems with hospital procedures and internal controls, saying that some money generated from $14 million in general obligation bonds issued during the 2012-13 fiscal year was spent for reasons not in line with the bonds’ intended purpose.
Auditors said the hospital used $3.7 million of the money for operations and almost $2.2 million to pay professional-services fees related to medical services. The 2012 bond election limited the hospital to spending the money on land purchases, buildings, machinery, equipment and furnishings, the audit said.
Although the audit recommended that the hospital repay the money spent on operational purposes, hospital executives disagreed that the $2.2 million spent on service fees was inappropriate, saying they had informed the public before the election that a substantial portion of the proceeds would go toward “physician and new service line development.”
The hospital plans to replace the $3.7 million used for operations before the end of the current fiscal year, the report said.
Martinez has said he’s optimistic the hospital will be able to turn around its finances in the near future and begin showing a profit.
Even though St. Bernard Parish voters earlier this month overwhelmingly voted down a one-year, 30-mill tax to support its fledgling community-owned hospital, Martinez isn’t worried about any anti-hospital backlash in St. Charles Parish, noting that the two proposals are very different. He said the tax in St. Bernard was “a one-time, very high millage,” whereas “this is a millage where we’re not increasing.”
The River Region Chamber of Commerce has endorsed the millage renewal.