Douglas Co. eyes hospital ownership transfer

Talk about it

ARMOUR — No one objected Tuesday night to a proposal for Douglas County to transfer ownership of Douglas County Memorial Hospital’s original portion to the hospital’s nonprofit corporation.

Hospital Administrator Heath Brouwer told 20 people about the hospital’s plans for an addition and renovation project, and he sought to have the county transfer the older portion of the hospital to conduct the project.

He estimated afterward the endeavor would cost between $3 million and $5 million and would require loans and grants. A design is in the works.

“I would like to benefit the community, as well as the hospital, by adding an addition and renovation to modernize the facility, which would allow us to continue to provide patient care services to the community and surrounding communities that we serve,” Brouwer said.

He spoke at a public meeting at the Douglas County Courthouse in Armour about the hospital and land transfer.

Brouwer initially brought up the issue with county commissioners on Nov. 4.

After the hospital was built in 1957 and the county ceased management in 1987, a nonprofit corporation with the hospital’s name was formed in 1989.

That corporation funded Prairie Health Clinic in Armour in 1998, along with a clinic addition, new retail pharmacy and Prairie Villa assisted living center in 2003.

Nearly four weeks ago, Brouwer told commissioners about the hospital’s shortcomings.

The hospital has one community shower for patients. He noted a lot of rooms don’t have enough outlets and breakers are getting blown. Rooms only have window air conditioning and are small.

At that time, commissioners delayed making a decision until they consulted with State’s Attorney Craig Parkhurst. He spoke on Nov. 16 with commissioners, who decided to set up Tuesday’s meeting.

Tom Kelly, of Armour, asked how the county transfer of ownership would work.

“My only concern is I don’t want T. Denny Sanford’s name on anything over here in Armour, S.D.,” he said, drawing laughter.

Parkhurst explained that state laws prevent so-called sweetheart deals in which local governments deed property to friends who have a private, economic interest. The county must declare property as surplus and take bids at a public auction.

Another option is for the county to transfer the property to a certain entity for specific purposes, he said. A land transfer to the hospital would qualify as one of them.

Parkhurst said he was recommending that a clause stipulate that if the land stopped being used for the public good, it would revert back to the county. If that would occur, the building would return to county ownership, while equipment would go to the corporation.

“As long as the hospital was operating as some type of health service, they would own the land just like any other landowner,” he said.

Brouwer said it would be difficult for the hospital to borrow money for a project on a building that it doesn’t own or could revert back to the county.

Parkhurst said he saw no legal reason why the county couldn’t enter into Brouwer’s proposal.

Commission Chairwoman Karen Blume asked Brouwer if the transfer would work with the reversion clause.

Brouwer said the hospital’s corporation has no intent to change its mission to a different industry.

He also noted that if the county continued with the lease, it would have to pay for wiring and other improvements that might result in a tax increase.

“We just want to control our destiny,” Brouwer said.

A hospital employee and others noted the hospital’s impact on the community.

Tara Ziebart, of Armour, home health director, cited the economic impact that the project would have in drawing more business to town.

“The more draw we have here definitely benefits the entire community, not just those who work at the facility,” she said.

Parkhurst said afterward that he will draw up a deed to transfer ownership of the hospital’s original portion, with the reversion clause, for the county commissioners to consider at their meeting next Tuesday.

Local business owner Mark Van Der Werff said afterward that he favored having the county transfer the deed to the hospital corporation.

“We recognize the value of health care in our community, in our county and we need to support it,” he said. “I would hope if push comes to shove, the county would be willing to support health care even more if need be.

“It’s really the lifeblood of our community and our area if we are going to survive out here. We need health care.”

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