Carson-Tahoe Hospital Trustees approved the expenditure of $10 million on Thursday to purchase land for their regional medical center. Currently owned by Eagle Valley Children's Home, the 55-acre parcel in northeast Carson City was the first choice of hospital officials.
A small group of hospital officials and supporters applauded and Trustee Pete Livermore lauded those involved in the six-month effort.
"The hospital was looking for a premiere site and Eagle Valley Children's Home is the piece of property we envision as the most appropriate for Carson-Tahoe's future. The whole community will benefit from this decision," he said. "I'm proud to have been a part of it."
Hospital officials closed escrow on 19 acres of Silver Oak property on Wednesday for $2.8 million. The $10 million approved Thursday brings their totals to $12.8 million for 74 acres.
Money for the purchase will first come from the hospital's board-designated funds, hospital profits used to finance new equipment, expansions and major purchases.
Carson-Tahoe is expected to assume about $40 million in defeasance bonds and following that, the money spent will be returned to board-designated funds. The balance, about $23.7 million, will be used to pay off the hospital's debt, bonds now held by Carson City.
Purchase of the Children's Home parcel will be completed in two phases: The first 30 acres will be purchased immediately for $4.5 million and the second 25 acres for $5.5 million within the next year.
The first Eagle Valley parcel will be secured immediately so the design for the medical center's main building can be completed by architects Moon and Mayoris, according to Chief Executive Officer Ed Epperson.
Located in the southeast part of the 55-acre parcel, it's adjacent to the 19 acres purchased from Silver Oak, where auxiliary buildings like the proposed cancer center and medical office buildings will be located.
The success of this project hinges -- in part -- on the hospital's ability to assume bonded indebtedness. The Standard and Poor's rating agency will conduct an on-site visit Jan. 24 to interview officials and determine what sort of bond rating the hospital can support.
The higher the bond rating, the more debt the organization can assume. Officials expect the hospital's transition to a nonprofit to be completed this spring, but defeasance bonding must be secured and the hospital's private, nonprofit status must be approved by the Internal Revenue Service.
Since Carson-Tahoe is still a county facility, the $10 million purchase must be approved by Carson City's Board of Supervisors. The item is on the agenda for the Jan. 17 meeting.