OKTIBBEHA COUNTY – Supervisors on Monday voted on a single motion declaring their intent to place millions from the sale of OCH Regional Medical Center into a long-term endowment while also opening the door to issuing as much as $15 million in bonds to address countywide needs.
The combined motion passed 3-1 with one member abstaining during the board’s regular meeting at the county’s circuit court building. The county expects between $55 million and $58 million in net proceeds from the October hospital sale, though the amount is still fluid, with roughly $3.8 million set aside for potential lawsuits and about $1 million reserved for health insurance costs.
Supervisors plan to invest the money into a reserve and trust fund, which must be established through local and private legislation to allow the county to invest into higher-yield assets. During the meeting, the board approved the language for the legislation.
County Administrator Wayne Carpenter said the board must pass a resolution by July 1 specifying exactly how much of the proceeds will be placed into the endowment, assuming the legislation is approved.
Board President and District 3 Supervisor Marvell Howard, who had not previously tipped his hand on whether he felt the hospital proceeds should be spent or saved, said the decision to invest came in part from the public.
“I think the majority of the public wants to see those funds endowed, and I think the board understands that, and that’s what we did today,” Howard told The Dispatch following the meeting. “But at the same time we also recognize that we have some immediate needs, and I think the bond will address that.”
The discussion about bonding authority emerged when District 2 Supervisor Orlando Trainer suggested the board consider either using a portion of the OCH sale proceeds or issuing bonds for county road projects.
Howard said he favored endowing all hospital funds but would agree to an intent to issue up to $15 million in bonds for countywide projects.
Trainer seconded Howard’s statement without Howard having made an official motion. Howard then moved for a resolution declaring the board’s intent to issue a bond of up to $15 million, receiving a second from Trainer.
“The one caveat to that is we will have to determine the assessed value of the county, and we can only bond up to a certain amount of the assessed value,” Howard said.
A bond with no projects?
Before the vote, the motion was amended to explicitly state the board’s intent to also endow all hospital sale proceeds on Trainer’s suggestion. During discussion of the amendment, Carpenter asked whether supervisors wanted to require projects be identified before issuing bonds, to which District 4 Supervisor Pattie Little voiced her support.
District 5 Supervisor Joe Williams disagreed, noting the board was not required to name specific projects in order to issue a bond. Echoing that point, Trainer said the county typically uses “flexible language” in bond orders, though ultimately the board declined to add language requiring projects be identified in advance.
They also left out a proposal from Williams that would have guaranteed at least $2 million from the bond to be allocated to each district.
Howard, Trainer and Williams voted to approve the motion.
District 1 Supervisor Ben Carver voted against the motion, while Little abstained from voting. Both said their concerns centered on issuing bonds without defined projects.
“That’s a big decision on all of us,” Little told The Dispatch following the meeting. “Putting all the money up is what I have been wanting to do. I have not had enough time to process bonds. … We have a lot of (needs). We need to start a fund for (a new) jail. … We have buildings that are crumbling, and we have a lot of work that needs to be done on a lot of buildings immediately, so I know we have a lot of needs.”
Carver, who attended the meeting virtually, said approving an intent to issue bonds without identifying specific projects was premature.
“That, to me, is not good fiscal responsibility to say we’re going to bond up to $15 million, but then what?” Carver told The Dispatch. “Nobody’s even named a project yet. Just to pull money out for the sake of pulling it out is not fiscally responsible in my opinion.”
Howard said the vote of intent does not obligate the county to issue debt.
“All the details will be worked out,” he told The Dispatch. “… That could be $1 million up to $15 million. We don’t have to move forward with it.”
How the county would repay any bonds issued also remains to be determined. Howard said he does not believe the county would directly set aside any hospital proceeds to service bond debt, but he said interest generated by the endowment could be a potential funding source.
“That’s a possibility, and there may be several different sources that we … decide to use to service the bond, but right now all of that has to be determined,” he said. “… Once we do all of our due diligence, then we’ll … look at the funding sources and things of that nature.”
You can help your community
Quality, in-depth journalism is essential to a healthy community. The Dispatch brings you the most complete reporting and insightful commentary in the Golden Triangle, but we need your help to continue our efforts. In the past week, our reporters have posted 35 articles to cdispatch.com. Please consider subscribing to our website for only $2.30 per week to help support local journalism and our community.
You can help your community
Quality, in-depth journalism is essential to a healthy community. The Dispatch brings you the most complete reporting and insightful commentary in the Golden Triangle, but we need your help to continue our efforts. In the past week, our reporters have posted 35 articles to cdispatch.com. Please consider subscribing to our website for only $2.30 per week to help support local journalism and our community.
