Planning For State Mandated Acute Care Hospital

VISALIA, CA – On Monday evening of this week, our Board of Directors approved two resolutions. The first was to confirm the need for Kaweah Delta to create a new acute care hospital to ensure vital life-saving care for patients into the future and to meet the requirements of California’s seismic safety laws. The second, to authorize a general obligation bond election within our District to assist in funding this critical project.

Creation of a new acute care hospital at Kaweah Delta will take place over fourteen years and will result in a six story new acute care hospital and a related central utility plant which will provide energy and other resources that are essential for operating the medical center.

Phasing development of the new acute care hospital is driven by two primary considerations, one, the fact that we can continue to fully use the bed capacity of the Mineral King wing until 2030 and secondly that developing the new acute care hospital in phases will allow us to build the new bed capacity needed to meet earthquake standards over the next fourteen years prior to 2030 as we are able to fund each phase of the project. In addition, building the structure of the new acute care hospital now will result in considerable cost savings as we avoid escalated construction costs from building in the future.

When the new acute care hospital is fully complete by 2030, the Mineral King wing of the Medical Center, which can no longer be used for acute care purposes, will still be available for outpatient care of patients including the unlimited use of its bed capacity for observation patients (those who are under evaluation and treatment for less than 24 hours). This will offer us considerable flexibility in the use of our full bed capacity for both acute care patients and outpatients.

The total cost of completing the fourteen year development of the new acute care hospital is estimated at $550 million. On Monday evening the Board approved the following funding plan:

• Revenue Bonds $75M
• Cash Reserves $133M
• General Obligation Bonds $327M
• Philanthropy / Grants $15M
• Total Capital Cost $550M

Relative to the Board’s authorization of a general obligation bond election to seek community support for $327 million of the total project cost, it is estimated that this would result in an average tax assessment of $48.70 per $100,000 of assessed valuation of real property within the District (taxable value as noted on the tax schedules of Tulare County, not current market value).

The current average assessed value of real property within the Kaweah Delta Health Care District is $175,000. Based on this average assessed value, the average tax assessment for this general obligation bond would be $85.23 per year or $7.10 per month. If we were to express this as a daily tax obligation it would be $.24 per day.

The Board’s action on Monday evening authorized a mail-ballot election which will take place on May 3, 2016. Ballots will be mailed to registered voters within the District by the County of Tulare in early April with a requirement that voters return their ballots by mail or at designated polling places by no later than May 3, 2016.

Creation of a new acute care hospital at Kaweah Delta will be one of the most significant capital projects ever undertaken in this community. While this project is required to comply with state law, it will, most importantly, enhance this community’s access to life-saving trauma care and other services including the ability to respond to critical healthcare conditions including heart attacks, strokes, cancer, and neurosurgical services.