Iola will continue supporting Allen County Regional Hospital through 2020, through a portion of the city’s sales tax revenues.
In a bit of high drama that ultimately lasted about 30 seconds, City Council members narrowly avoided falling short of the votes necessary to extend the helping hand another year.
That’s because two Council members, Kim Peterson and Ron Ballard, both said they were abstaining from voting on the measure because of conflicts of interest. Ballard said he had business dealings with the hospital; Peterson’s husband, Larry, is ACRH’s chief financial officer and interim chief executive officer.
And with Councilman Daniel Mathew absent from Tuesday’s meeting, approving the sales tax ordinance required at least five affirmative votes.
Four of the five remaining Council members voted yes. Councilman Gene Myrick did not.
“I’m speaking of what citizens have told me,” Myrick said in explaining his no vote. “They told me, the sales tax needs to stay within the city.”
Realizing the potential ramifications of a failed vote, Mayor Jon Wells appealed to Peterson to reconsider her abstention.
While saying he respected her ethical abstention, Wells pointed out the city’s sales tax proceeds were going to the hospital to assist with maintenance and capital projects; not for such things as employee salaries.
Peterson, who has been clear in past meetings in saying she supported “whatever was necessary” to keep the hospital afloat, retracted her abstention, and cast the deciding yes vote. She was joined by Nancy Ford, Aaron Franklin, Chase Martin and Mark Peters.
The quarter-cent sales tax, expected to generate around $300,000 in 2020, is a continuation of the city’s support of ACRH since before it was constructed in 2013, and would allow the county to transition to a renewed sales tax commitment of its own.
Up to now, those revenues have been used to ensure the hospital had sufficient working capital. That will change soon, now that the county has a new lease agreement with Saint Luke’s Health Systems.
Saint Luke’s will assume responsibility for paying off construction bonds and working capital; the county (with the city’s help) will retain responsibility for the building’s upkeep.
Hospital trustees Loren Korte and Jim Gilpin and Larry Peterson told Council members last week the county’s own quarter-cent sales tax authority expires at the end of 2020.
They anticipate going back to the voters to reauthorize the sales tax, but at a slightly higher rate (three-eights of a cent) to make up for what the city had provided.
“We appreciate very much the many years you’ve made this possible,” Gilpin told the Council at its Oct. 28 meeting. “One more year would get us to where we need to be.”
