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Finance committee approves short-term invoicing access for Dahl Memorial Clinic 501(c)(3) during transition
Summary
The committee agreed to allow the Dahl Memorial Clinic's newly formed 501(c)(3) to invoice the municipality for up to $25,000 per month for three months (reimbursable) to cover start-up costs for a retail pharmacy and administrative setup.
The finance committee approved a request allowing the Dahl Memorial Clinic 501(c)(3) to invoice the municipality for up to $25,000 per month for up to three months to support startup costs during transition from a municipal department to an independent nonprofit. The funds are intended for legal counsel, insurance, pharmacy infrastructure and initial inventory and personnel costs tied to a planned retail pharmacy.
Manager Deetsch explained the legal separation: the 501(c)(3) is a separate entity and cannot directly access municipal budget lines. The practical approach discussed and approved was a reimbursable invoicing arrangement: the clinic-in-transition would submit a monthly invoice (a single lump sum) to the municipality, which would issue payment; the clinic expects to reimburse the municipality by the end of the year when pharmacy revenue begins. Deetsch told the committee the municipality "would invoice us for whatever the cost was. We would cut them a check" and emphasized that municipal staff would not be performing the nonprofit's bookkeeping.
Treasurer Heather and other members emphasized the need for limited scope legal counsel for the clinic (the municipal attorney cannot represent both sides in leases or MOAs) and requested clear invoice/reporting terms. Committee discussion reviewed initial line estimates included in the clinic letter: an example first-month estimate cited $19,475; pharmacy inventory of about $7,500 and personnel costs around $8,000 were mentioned as part of start-up calculations.
Assembly member Waddell moved and Assembly member Potter seconded a motion to allow the Dahl Memorial Clinic 501(c)(3) to invoice the municipality up to $25,000 per month for three months to be reimbursed by year-end. The motion carried by voice vote. Staff will establish invoice format and oversight protocols for reimbursement tracking.
Next steps: Director Wall (clinic) was asked to appear at the assembly meeting to explain details; staff to draft invoice and reimbursement terms and circulate to finance and the clerk prior to disbursing funds.
