Committee backs supplemental appropriation for Laguna Honda Hospital replacement project

The Budget and Finance Committee on the recommendation advanced an ordinance to appropriate tobacco settlement revenue and interest from 1999 Laguna Honda Hospital general obligation bonds to the Laguna Honda replacement project.

John Thomas, program manager for the Laguna Honda replacement program, told the committee the supplemental appropriation covers funds previously approved by the capital planning committee but omitted from the annual appropriation ordinance and is intended to address near-term cash-flow needs as construction continues toward a late-2009 completion.

Vice Chair Sean Ellsburn asked how much tobacco settlement revenue would remain after the appropriation; Nadia from the Office of Public Finance said estimates from PFM forecast annual tobacco settlement receipts in the range of $18 million to $20 million and projected collections through April 2011 under current assumptions. Budget analyst Mr. Rose said about $48.5 million of the total $51.3 million requested would go to Turner Construction Company and $2.8 million to the joint venture of Ashen & Allen Architects and Stantec Architecture.

Thomas and staff said they expect one additional supplemental of roughly $2 million to reach a 780-bed target; Monique (staff) said the $2 million could be appropriated in the next year’s budget and that the current appropriation should carry the department through the fiscal year.

There was no public comment. The committee voted to send the ordinance forward with the analyst’s recommended amendments.

The committee’s action was procedural: it recommended forwarding the ordinance to the full board for final approval and did not itself enact the appropriation.