ATLANTA -- Dade County, Fla., voters last week approved a half-cent sales tax increase that will funnel $60 million a year into the county's largest public hospital and that eventually could help it fund a large bond-financed construction program.
Ronald Ruppel, chief financial officer at the Jackson Memorial Medical Center, said yesterday a portion of the added revenues could be used to secure bonds to fund the hospital's current building plans as well as new construction programs that will be included in its upcoming capital plan.
"We anticipate bonds being sold, but we cannot determine any amount until sometime next year," he said.
Jackson Memorial hopes to put together in the next six months a five-year financial plan to identify long-term needs, Mr. Ruppel said, adding that the hospital is currently in the process of choosing a financial adviser to help it draw up that plan. The financial adviser, he said, could be designated by the end of this year.
Mr. Ruppel said the hospital also is reluctant to draw up capital plans until it has some experience with collection of the surtax, which will not be imposed until Jan. 1. The hospital itself will not be given its first portion of the tax until April 1.
Until capital financing plans are clearer, Mr. Ruppel said, Jackson Memorial will use the funds from the tax increase to cover operating expenses that have strained the hospital's Public Health Trust. In particular, he said, it will apply the sales surtax to a number of new ventures, including special care centers for diagnosis and post-operative care and facilities for the treatment of trauma, breast cancer, respiratory, and infectious-disease cases. The hospital also is setting up a county-wide health-care system model.
Operating expenses for these ventures have been estimated at $70 million a year, construction costs at $31.9 million, and capital equipment at $19 million.
"This is a wish list and could be revised," Mr. Ruppel said, noting that the hospital also is currently working to set its operating budget for the next year, which begins Oct. 1. This year the hospital budget is $560 million.
Mr. Ruppel said bonds for hospital construction could be issued either by Dade County itself -- perhaps as public facilities revenue bonds -- or through the hospital.
"When the hospital puts together its plans to sell bonds, we will give them a careful look," Edwards Marquez, director of finance for Metro-Dade County, said yesterday. Mr. Marquez said the county also is in the preliminary stages of determining a new general obligation bond authorization, and when that authorization is established, some county GOs could eventually be sold to fund hospital construction. The county's current authorization, which had been set at $533 million, is nearly all used up.
The sales tax increase, which will raise the county-wide levy to 6 1/2 was passed last Tuesday by a 57% margin of county voters. Yearly receipts from the surtax will actually total about $80 million, but because the county is planning to cut back its contribution to the hospital by 20%, the net increase to the hospital from the tax is only $60 million. The county currently gives $97 million a year to the hospital.
Dade County, whose general obligation bonds are rated A-plus by Standard & Poor's Corp. and A1 by Moody's Investors Service, currently has about $380 million of tax-supported debt outstanding. In Oct. 1986, the county sold 15.5 million of new-money public facilities revenue bonds and 50.1 million of refunding bonds for the Jackson Memorial Hospital.