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City clarifies role in hospital property dispute; lawsuit noted, business operations separate
Summary
City officials told the council the municipality’s interest is the hospital building and that a recent lawsuit concerns the hospital business rather than the city; staff said the Helena Health Foundation may be taking over operations from Progressive and the city will focus on property options: sale or rent.
City officials briefed Helena City Council on the status of the former hospital property and a related lawsuit, emphasizing that the city’s role is limited to ownership of the building while the hospital business is run by separate entities.
City counsel and staff said the city issued $9 million in revenue bonds in 1998 for the hospital building under an agreement with the Helena Hospital Corporation, which operated the clinical business until Jan. 1, 2025. Under that agreement the operator was responsible for business operations and bond payments; the city’s interest, officials said, has been the physical building and the payment of the bond. Staff said the bond is now paid and that the city’s options going forward are to sell the building or receive rent.
The city attorney told the council that a lawsuit had been filed related to actions alleged against several officers who were let go last year; the attorney advised waiting on personnel-related administrative hearings so as not to affect pending litigation. On the hospital specifically, the attorney said Progressive (a prior operator) is no longer a player and that it is the city’s understanding that the Helena Health Foundation has taken over the business side. Officials asked the council to avoid public discussion of ongoing negotiations between Progressive and the Helena Health Foundation while a roughly 30-day window of transition remains.
Council members asked for periodic updates; the city attorney said he would provide further information on litigation and administrative steps once he had more details.
Ending: The council received the update; no formal city action on the hospital property or on litigation was taken at this meeting.
