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Commission approves first reading of home-rule ordinance to transfer hospital property to nonprofit corporation
Summary
The Coffeyville City Commission approved the first reading of a home-rule ordinance to dissolve the city-owned hospital entity and begin transferring hospital property and assets to Coffeyville Regional Medical Center, Inc.; commissioners discussed reversion rights and said the city sales tax that helps the hospital will remain in place.
The Coffeyville City Commission on Jan. 28 approved the first reading of a home-rule ordinance authorizing the dissolution of the city hospital entity and beginning the process to transfer title and assets to Coffeyville Regional Medical Center, Inc.
City Manager Ben Brubaker and Garth Herman of Gilmore & Bell, the city’s bond counsel, told commissioners the ordinance uses the state constitution’s home-rule authority to fill a gap where state statute does not specify how a city should dissolve a municipally owned hospital and transfer property to a nonprofit corporation. Herman said the ordinance would end the city-appointed board of trustees for the hospital and authorize staff to negotiate transfer documents.
The ordinance would not change the existing city sales tax that provides resources to the hospital, officials said. Herman and Brubaker said past cooperative financing — including bond issues and sales-tax measures approved by voters — would remain in effect.
Commissioners asked about contingency language in the transfer documents if the nonprofit corporation later dissolved or the hospital ceased operating. Brubaker and other staff said the transfer documents under negotiation could include a reversionary or reacquisition right allowing the city to reacquire assets if they stopped functioning as a provider of health care, but they said details would be worked out in the transfer agreement. City Attorney Paul Scribe and CRMC representatives in the meeting indicated the city’s current ownership is tied to an original 1949 portion of the building and that newer facilities are not city-owned.
Commissioners paired the ordinance with public discussion during the meeting about the practical implications of transferring title to a nonprofit and whether future building vacancy would become a city problem; staff said those scenarios would be addressed in the transfer documents where appropriate.
The commission approved the ordinance on a 5-0 voice vote on first reading. Commissioners recorded their votes as: Commissioner Edwards, aye; Commissioner Hendricks, aye; Vice Mayor Van Oster, aye; Commissioner Faulkner, aye; Mayor Maples, aye.
Next steps include completing the negotiated transfer documents and returning to the commission for subsequent ordinance readings and final actions as required by city procedure.
