Prince George’s County Executive Rushern L. Baker III (D) wants to cover the debt of the county’s hospital operator to increase chances that the state will approve a new $645-million hospital at Largo Town Center.
“The county desires to refund an estimated $48.15 million of outstanding bonds issued by Dimensions Healthcare System, Inc., in 1994,” Baker wrote in a Sept. 6 letter. “This refunding transaction will improve the long-term financial condition of the healthcare system and assist in obtaining the approval of its Certificate of Need.”
Dimensions is a nonprofit organization that operates four county hospitals including the aging Prince George’s Hospital Center in Cheverly, which would be replaced by the proposed 280-bed Largo hospital. Under state law, Dimensions needs a Certificate of Need — which outlines the area health needs that justify a hospital — to build the new regional medical center.
Covering the majority of Dimensions’ debt would take down a “large hurdle” in getting state approval, said Dimensions spokeswoman Erika M. Murray.
“It would definitely make Dimensions’ financial position look different than otherwise would. Our goal was to try to make the financial statements...of Dimensions look as good as it could be,” said Thomas Himler, the county executive’s deputy chief administrative officer.
“[The county] is helping us pave the way to getting our Certificate of Need approved,” Murray said.
The county would pay off the debt in roughly $5 million annual increments over 12 years, according to the resolution.
All multi-year contracts that total more than $500,000 must be approved by the County Council, which introduced the resolution, CR-89-2013, during its Sept. 10 meeting.
“It’s not going to cost us anything more than we’ve already been doing,” Himler said.
The county has been subsidizing Dimensions’ operating costs with annual $15 million payments, he said. If the resolution passes, the county will pay Dimensions $10 million a year.
The council will discuss the resolution on Sept. 24, said Shelby McRae, a County Council spokesperson.
“We appreciate the forward thinking of the county executive and the council, which removes a hurdle towards approving our Certificate of Need application,” said C. Philip Nichols, a Prince George’s County judge and chairman of the Dimensions board. “This is a great example of the power of partnership and it’s clearly a smart move.”
A public hearing on the payments is scheduled for Oct. 1, when the council will also decide on the resolution.
“We’re optimistic [council] will approve it,” Himler said.