Dooly County moves to support beleaguered Dooly Medical Center as authority announces closure
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Summary
Dooly County Hospital Authority announced plans to close Dooly Medical Center effective June 1, 2001 because of critical cash‑flow problems; the county agreed to loan the authority $245,000 and authorized short‑term borrowing to cover the advance.
The Dooly County Hospital Authority told county commissioners in late spring that Dooly Medical Center was facing critical cash‑flow problems and that the authority’s board had concluded the facility could not continue without immediate financial assistance.
At a May 25 special meeting, Authority CFO Ken Rhudy announced the board’s decision to close the hospital on June 1, citing the center’s financial condition. In subsequent meetings and a May 29 special session, the county and the hospital authority explored options for keeping essential services and for liquidating assets if closure became unavoidable.
On June 7 and reconvening June 8, the county voted unanimously to execute an intergovernmental loan agreement and to make a $245,000 bridge loan to the Authority to meet immediate obligations. The board also authorized County officers to borrow $245,000 from Flag Bank of Vienna at 4.50% to fund the loan; the loan documents were approved and the board authorized execution of the intergovernmental agreement.
County finance actions and context: The authority had previously been supported by a $650,000 non‑revolving line of credit from the Bank of Dooly, with the county committed to $20,000 monthly payments; facing mounting obligations (payroll, vendor invoices, utilities), the authority sought temporary county assistance while exploring sale or liquidation of the hospital property and assets. The county later agreed in October to make $240,000 available to the Dooly County Industrial Development Authority for related economic development work tied to the facility’s site and transition.
Why it matters: The hospital served local patients and employed county residents. The board’s decision to provide a short‑term loan reflects the county’s effort to manage financial and operational risk and to preserve access to health services while the hospital authority addresses reimbursement, receivables, and asset disposition.
What happened next: The Authority pursued asset disposition and sought buyers; the county recorded votes authorizing short‑term borrowing and approved an intergovernmental agreement to formalize the loan, with repayment terms recorded in county minutes.