Pauls Valley, OK, Pauls Valley Democrat

Community News

February 24, 2014

Tax really about hospital’s future

bporterfield@pvdemocrat.com — Pauls Valley city officials are reminding voters an election is not far way for a half cent sales tax meant to help the local hospital.

They are also saying the election on Tuesday, March 4 really comes down to not only the level of support out there for Pauls Valley General Hospital but whether or not it will remain open.

“The reason we’re going for this tax is to try to keep our hospital open,” City Manager James Frizell said during a recent presentation.

“The best way to keep this hospital open is to vote for this tax,” he said. “We’ve got to have it.

“It’s important to get out and talk to people; encourage people to get out and vote.”

Like others before him Frizell stresses the revenues from this tax, if approved by voters, will not be used to pay off old debt incurred by the hospital.

Those past debts coming before the hospital filed bankruptcy nearly a year ago are being accounted for through a process that doesn’t include this tax.

Instead, revenues from this half cent tax are earmarked strictly for helping the hospital make capital improvements, specifically diagnostic equipment and services.

“No matter what you’ve heard this tax won’t go to pay off the debt,” Frizell said. “This is not for personnel or paying off debt.

“It’s to upgrade many of the hospital’s services. It will be used specifically for the operation of the hospital moving forward.”

Lorin Jacobson, a member of the PV City Council and Hospital Authority, says it’s those services provided by the hospital that this tax is all about.

He agrees with Frizell the future of the hospital without this tax looks very bleak.

“We’re targeting diagnostic imaging equipment,” Jacobson said about the tax revenues.

“It’s hard to imagine a scenario where we have a hospital without this tax.”

Estimates are the tax will generate in the neighborhood of $600,000 a year with all of that going for a major upgrading of the hospital’s diagnostic equipment.

Even though the election hasn’t happened yet, both Jacobson and Frizell say a number of changes are already underway, namely the work to “fine tune” the process of updating and improving the hospital as a whole

The one area getting much of the attention is the billing process, which others have said is at the center of the hospital’s current financial struggles.

“That’s where the most drastic changes are taking place,” Jacobson said about the billing.

“Right now we have a billing and medical system that is obsolete,” Frizell said.

“It will cease to exist in a year,” he said about a system currently done by hand.

That system has an updated one on the way, they said.

One person who knows the situation well is Tom Litz of Blanchard, who last fall conducted a study of the overall hospital operations.

Litz has said it was a failed attempt to update the billing process years ago that played a big part in the current financial problems.

“Because of bad management decisions,” Litz said when asked why the hospital is now forced to work its way out of the financial trouble.

“The big one was a disastrous attempt to install a new computer software system for billing and medical records,” he said.

It was this “misadventure” that Litz says sent the hospital in a downward financial spiral over the past few years. That’s led to this need for the revenues from the half cent sales tax on the ballot for PV voters on March 4.

If voters say yes and pass the tax Frizell points to a plan to get the hospital “up and running” by using the tax revenues to borrow millions of dollars through a 20-year loan.

Frizell says this would allow the city to speed up the process and begin updating the needed equipment and other services much faster.

Plans also include making sweeping changes to the hospital’s emergency room, along with surgical services currently not available at PVGH.

The city manager says the overall tax level in Pauls Valley wouldn’t jump that high even with this new tax.

The half cent tax has the potential of taking the community’s overall sales tax to 9 3/4 cents.

That, he says, is comparable to other communities in Oklahoma with tax levels ranging from 9 to 10 3/4 cents.

To really put it in perspective Frizell said the tax represents an increase of 50 cents for every $100 worth of purchases made in Pauls Valley.

A reminder to PV voters — they will see two different ballots on election day.

One is this half cent tax to support the local hospital. The other is a half cent tax renewal for Garvin County.

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