MASSENA — St. Lawrence Health System will be providing Massena Memorial Hospital with $2.8 million to help pay the hospital’s short-term expenditures, but it’s money that must be paid back by Massena Memorial.
The Dormitory Authority of the State of New York is lending the $2.8 million to St. Lawrence Health System, and that money will be used as a line of credit for Massena Memorial.
“We need some cash right now. The Department of Health realized that and they were setting up this loan with DASNY,” Town Supervisor Steven D. O’Shaughnessy said.
He said that type of loan cannot be given to a municipality. The town of Massena is the current owner of Massena Memorial Hospital.
“They set it up through Canton-Potsdam Hospital. The town of Massena had to be the guarantor for the $2.8 million,” Mr. O’Shaughnessy said.
Massena Memorial Hospital will repay the money using $20 million in grant funding it is receiving from New York State’s Health Care Facility Transformation Program. The funding is contingent on St. Lawrence Health System creating an entirely new nonprofit entity that will acquire Massena’s assets and operate the hospital as part of St. Lawrence Health System.
The hospital’s Board of Managers, Massena Town Council and St. Lawrence Health System have signed an agreement to convert Massena Memorial from a public to private, nonprofit hospital that would become part of St. Lawrence Health System, along with Canton-Potsdam and Gouverneur hospitals. Under that deal, St. Lawrence Health System will assume the Massena Memorial’s current long-term debts and liabilities.
Chief Financial Officer Patrick Facteau had reported during the July Board of Managers meeting that, from January to June, the hospital had a net loss of $4.5 million.
“If you look at this, the debt is like 10 years worth of town taxes. Everybody should be joyful that this is here today. This is unbelievable. It’s going to help our hospital survive and provide quality health care for Massena to continue,” Town Councilman Samuel D. Carbone Jr. said.
The $20 million in grant funding will be used to help bolster the hospital’s financial situation and advance efforts to make sure Massena and the surrounding area continue to receive health care services locally.
That funding was announced by Gov. Andrew M. Cuomo on Wednesday. According to a release fro the governor’s office, $187 million will be used to support 25 statewide projects “that will protect and transform New York State’s health care system.”
The north country was awarded $21.5 million, including the $20 million for Massena Memorial. The release said Massena’s money will be used to “retire debt and support the conversion of Massena Memorial Hospital from a public to a voluntary non-profit hospital affiliated with St. Lawrence Health System as part of an overall sustainability plan to preserve essential health care services in the Town of Massena.”
Alice Hyde Medical Center will receive $1.5 million for capital improvements to purchase telemetry monitoring equipment, upgrade the pharmacy, and relocate and expand the Women’s Health Center.
A resolution approved by the three boards on Tuesday agrees to transfer all of the hospital’s assets and liabilities to St. Lawrence Health System.
“The big one is the Asset Purchase Agreement transferring all the assets and liabilities to St. Lawrence Health System,” Mr. O’Shaughnessy said. “As part of the APA, Canton-Potsdam Hospital committed to putting $8 million into the facility.”
Although the $8 million is contained in the Asset Purchase Agreement, St. Lawrence Health System is not paying $8 million to purchase the assets, he said, but rather, is making a commitment to fund $8 million into the hospital’s operation.