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County approves first reading of up-to-$130M bond ordinance to finance Ephraim McDowell expansion
Summary
Boyle County Fiscal Court approved the first reading of an ordinance on May 13 that would allow issuance of up to $130 million in tax‑exempt hospital revenue and refunding bonds to finance improvements at Ephraim McDowell Regional Medical Center.
Boyle County Fiscal Court on May 13 approved the first reading of an ordinance that would authorize the issuance of up to $130 million in tax‑exempt hospital revenue and refunding bonds to finance improvements at Ephraim McDowell Regional Medical Center.
Bond counsel and hospital leaders described the financing as a common structure in which the county issues bonds on behalf of the hospital so debt interest can be federally tax‑exempt, producing lower interest costs for the hospital. Bond counsel said the arrangement does not create county liability: debt service would be payable solely from money provided by the hospital or related obligated group.
Why it matters: If finalized, the financing would support renovation and construction to expand emergency and other services at Ephraim McDowell, a major local employer, while preserving the county's debt capacity under Kentucky law. Officials said the financing will not count against the county's statutory debt limit (2% of assessed value) but may affect the county's ability to obtain "bank qualified" status for any other tax‑exempt debt this year because of the size of the issuance.
What officials said - Mark Franklin, bond counsel, said the loan structure lets the hospital borrow at lower rates because interest is federally tax exempt and that the county is not liable for the bonds' debt service. - Dan McCase, president of Ephraim McDowell, and Amanda Kidman, CFO, described property acquisitions, Tower renovations and plans to vacate older hospital space in fall and open improved facilities next season. McDowell representatives said Regions Bank has agreed to buy the bonds in a private placement.
Process next steps Federal tax rules require a public hearing before bond issuance; county staff scheduled a bond hearing at 8:45 a.m. at the next fiscal-court meeting. Officials said sample ordinance and indenture documents are available at the courthouse.
Vote The court approved the first reading of Ordinance 950.26 by voice vote (motion by Magistrate Gay; second by Magistrate Ellis). The motion carried.
Ending: The court advanced the financing to the next formal steps: public hearing followed by a second reading (vote) at a future meeting.
