Lower values increase Whidbey General Hospital bond rate

After spending several months promoting a bond proposal to fund an expansion, Whidbey General Hospital officials find themselves in the uncomfortable position of changing the information they have been telling potential voters.

Because the assessed valuations of property in Island County appears to be dropping for the third year in a row, homeowners could see a higher rate per $1,000 assessed property value than what they were originally told. Voters will likely be asked to approve an estimated $50 million hospital expansion bond in May.

The Whidbey General Hospital Board of Commissioners held a special meeting Friday to discuss the impacts of the declining assessments. Assessed property valuations in 2010 stood at $10.93 billion. That amount is expected to drop to $9.71 billion in 2011, which represents an 11 percent decrease, according to information presented during the meeting. Hospital officials originally figured a 6 percent decrease in assessed valuations when estimating the bond figures.

Despite repeated attempts at contact, Island County Assessor Mary Engle did not return phone calls about why valuations continue to drop or whether the information provided Whidbey General Hospital is accurate.

Hospital officials figured that the bond would cost taxpayers approximately 30 cents per $1,000 assessed property value. Now, with the new valuations taken into account, the rate that taxpayers would pay jumps to 34 cents.

Hospital Chief Financial Officer Joe Vessey cited the declining valuations as the primary reason for the rate increase.

“Proportionately, it’ll feel like they’re paying more,” CEO Tom Tomasino said during the meeting.

The rate change poses a problem for hospital officials. Tomasino has been talking with community groups since August about the upcoming hospital bond. He said he’ll revisit the groups and give them updated information.

Whidbey General Hospital is running a bond that will pay for a new wing on the south side of the hospital campus. The new wing will have single patient rooms for better privacy and the bond will also pay for updates to the facility that will, among other things, improve patient handling and efficiency.

Vessey said he has talked with the bond underwriter and learned the hospital should benefit from increased demand from investors when it comes time to sell bonds, should voters approve. It has to pass by a 60 percent supermajority.

The hospital board plans to meet Feb. 14 to formalize an election date in May and decide the exact amount for the measure, which is expected to cost $50 million and take 25 years to pay off.

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