Belen City Council approves amended JPA; county to now have its say

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One down, one to go.

Belen city councilors approved amendments Monday to the joint powers agreement with Valencia County, concerning the proposed hospital in the Hub City.

The JPA, outlining the roles of the city and county regarding the development and operation of a proposed hospital near Interstate 25 in Belen, is on its way for approval by county commissioners, before being sent off for a second review and consideration by the New Mexico Department of Finance and Administration.

The state agency sent a letter to Belen and the county in January stating it couldn't approve the JPA "at this time, since our review has raised several potential issues that require additional analysis by the parties and/or revisions to the JPA."

Although the final edits of the 17-page agreement went back and forth between the city and county attorneys and DFA representatives a few times, Steve Tomita, the city's planning and economic development director, said the city feels confident the concerns were addressed.

"(DFA's) statement to us was, if we adopt these changes, the DFA has approved the JPA," Tomita told councilors.

The five-page letter from DFA lists a number of concerns about the agreement, such as the JPA not defining which power the governing bodies would jointly exercise, the use of mill levy proceeds for the operation and maintenance of a hospital, a potential conflict between termination provisions, the limits applied by the Hospital Funding Act on the issuance of revenue bonds, how equipment and improvements made with revenue bond proceeds can legally belong to a private, contracting hospital upon termination of the JPA and identification of the statutory authority under which the city will sell or lease the property to the county or contracting hospital.

Of the minor changes in the JPA, city officials added that the health care facilities contract RFP would be produced and issued by a county or city employee. Who would pay for the advertising for that RFP and how much they would pay was left blank.

This step follows where the agreement outlines that both parties will "jointly issue a request for proposal" for a lease or other acquisition of the Belen site from the city for construction and operation of a hospital facility.

This would occur after county officials verify the results of Belen's financial feasibility study through either an internal evaluation or by hiring an independent consultant who would provide an independent validation report deciding if a hospital is "successful and sustainable" at the Belen site. This verification has not been completed by the county.

The feasibility study, completed by Ameris Acquisitions' sister company, Ameris Management Services LLC., found that a hospital with 28 medical/surgical beds and 12 geriatric psychiatric beds, along with basic medical/surgical, diagnostics and a 24-hour level one emergency service is "a financially viable endeavor" at the Christopher Road site.

Belen officials drafted a health care facilities contract earlier this year. They also named Ameris Acquisitions, LLC as the qualified medical provider to develop, manage and operate the proposed hospital in Belen.

The Nashville company was the lone responder to the city's request for information and qualifications that identified a medical provider and who to lease city-owned land to for the proposed hospital.

Another change grants the financial responsibility of operating and maintaining the hospital facility to the contractor, before mentioning that the mill levy funds would be used for these costs. City officials omitted who is responsible for developing and equipping the hospital facility, which isn't mentioned again in the agreement.

The JPA goes on to add that Valencia County and Belen "may, if necessary, appropriate and authorized by law" issue revenue bonds for the purpose of constructing, purchasing, renovating, remodeling, equipping or re-equipping the Valencia Community hospital and the acquisition of land, but aren't obligated to do so.

Mention of the Hospital Funding Act justifying revenue bonds was omitted.

At the May 1 county commission meeting, one commissioner raised the question of potential future financial obligation of taxpayers through the use of general obligation bonds.

Commissioner Alicia Aguilar asked if the Belen hospital project was going to be privately financed.

Belen City Councilor Jerah Cordova, who was at the meeting to present the city's rebuttal to a recent hospital resolution issued by the village of Los Lunas, referred to Ameris' RFI proposal, specifically the letter from Stern Brothers.

The letter stated the Chicago company would not require county or city bonds to fund the project.

"It will be privately financed, other than the mill levy," Cordova said. "We have financing that is available, that is fully private and we will pursue that if the commission wishes."

Aguilar noted the agreement still had language about optional bonding and asked if that could be removed. Cordova said the city would be "happy to do that."

The agreement goes on to stipulate the JPA, HCF contract or other contracts entered into following the JPA would outline who would acquire property from the hospital once the JPA is terminated.

City officials also added that both parties would comply with laws associated with the disposition or lease of real property.


-- Email the author at aortiz@news-bulletin.com.