Hospital plans $56 million expansion

To expand Hazel Hawkins Hospital to a level that can meet the
service demand of an ever-increasing population, hospital officials
estimate they need to raise approximately $56 million over the next
20 years through a proposed property tax and impact fees for 50,000
square-feet of new facilities.
Hollister – To expand Hazel Hawkins Hospital to a level that can meet the service demand of an ever-increasing population, hospital officials estimate they need to raise approximately $56 million over the next 20 years through a proposed property tax and impact fees for 50,000 square-feet of new facilities.

To garner the much-needed revenue, officials are proposing implementing a property tax for residents to vote on in a May mail-in ballot election and imposing impact fees for new houses built in the next several years, according to hospital CEO Ken Underwood.

However, some Hollister city and San Benito county officials are leery of increasing impact fees that already exceed those in surrounding counties, although they acknowledge the hospital is in desperate need of an expansion.

The property tax would be voted on by the community in a mail-in ballot in May. But an increase in impact fees – which could boost home-building fees by more than $2,000 – would be decided on by the county Board of Supervisors and the Hollister and San Juan Bautista city councils sometime next year, Underwood said. Neither option is official yet because the hospital board has to approve the property tax at its meeting in January and the impact fee proposal hasn’t been agendized on any of the boards yet, he said.

Hospital volunteers will start mailing informational pamphlets on the proposed property tax, which would add $18 to every $100,000 of assessed value, come the first of the year, Underwood said. That means if someone owns a $600,000 home with an assessed value, the tax would add an additional $108 to their existing property taxes annually. A mail-in ballot will be issued in May as long as the hospital board approves it in January, and a two-thirds vote will be needed to approve the tax, Underwood said.

Underwood said the hospital commissioned a survey about four months ago that asked 400 voters whether they would support the tax, and about two-thirds of the people surveyed said they would vote for the amount the hospital is proposing.

“These projects are going to be necessary for us to provide quality services over the next 20 years,” Underwood said. “The community owns this hospital. I hope people will realize 100 percent is invested back into providing quality healthcare services locally.”

If the tax passes, it would raise about $30 million over the next 20 years, he said.

Five new buildings would make up the hospital’s facelift and would include a new emergency room almost three times the size of the current one. It would provide new technology and furnishings to treat 30,000 patients annually in a timely manner. The current 3,500 square-foot space can only treat 14,000 patients a year and makes for long waits and poor patient satisfaction, according to a hospital-issued statement.

Also included in the expansion is a new obstetrics and rehabilitation unit, an upgraded laboratory and numerous pieces of advanced medical equipment to detect cancer and treat heart patients.

Underwood hopes to start on the first phase, which would either be construction on the new emergency room or the new obstetrics unit, by 2007, he said.

Supervisor-elect Don Marcus conceded the hospital needs to expand to accommodate the county’s growing population, but isn’t sold on the impact fee method of raising the money, he said.

He said impact fees don’t only affect incoming residents, but long-time residents who are upgrading their homes can also suffer the consequences of an increase.

“I don’t know that is the best way,” Marcus said. “I feel taxing the entire community would be better, particularly when the community gets to vote on it.”

The impact fees would affect anyone building a new home in the county – including Hollister and San Juan Bautista – and would add between $2,100 to $2,300 to the approximately $30,000 in impact fees new home owners and developers must cough up to build in San Benito, Underwood said.

If the county Board of Supervisors and city council members in Hollister and San Juan Bautista approve the increased fees, it would garner about $21 million for the expansion over 20 years, Underwood said.

None of the boards have the impact fee proposal on the agendas yet, but Underwood hopes to have it up for discussion sometime in the next few months, he said.

Because of Hollister’s building moratorium, the city isn’t issuing any building permits and the county is issuing very few, Underwood said.

“Truthfully, our objective is to have it reviewed by the governing agencies and hopefully approved,” Underwood said. “The impact of the impact fees may not be until 2006.”

Recently elected Hollister City Councilman Brad Pike mimicked Marcus’ hesitancy concerning the impact fees, but championed the property tax idea because it lets the public decide what they want to do with their tax dollars.

“I’m in favor of expanding the hospital. We need to have a viable way of treating people in our community,” Pike said. “But impact fees, alone – I’m uncomfortable in saying that’s our answer.”

All the San Juan Bautista City Council members did not return phone calls Thursday except for newly elected City Councilman George Dias, who declined to comment.

Erin Musgrave covers public safety and health issues for the Free Lance. Reach her at 637-5566, ext. 336 or [email protected]

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