KPB Prop 2 won’t hike taxes to pay for SPH improvements

As Kenai Peninsula Borough and Homer voters face a slate of bond propositions and tax changes, KPB Proposition 2 could be an easy sell for voters for one simple reason: It won’t take a dime from taxpayers.

The proposition asks voters to approve a general obligation bond of up to $4.8 million to expand South Peninsula Hospital’s Homer Medical Clinic and install a new hospital operating room air handling and ventilation system. Because of increased property values in the SPH Service Area, that won’t require a mill rate increase.

Those projects will happen if the bond doesn’t pass, so options come down to two financing plans:

• Get approval from voters for a general obligation bond financed at about 1 percent and payable at $370,000 a year for 15 years, or

• If the voters don’t approve the bond, borrow the money from the borough that’s financed at about 3 percent.

Financing through a bond, the cheapest option, would save up to $300,000 for both projects.

To pay for the $4.8 million bond would require .21 mills or $21 per $100,000 of assessed value. However, the proposition question says “Based upon assessed values, the administration does not see any need to change the current mill rate.” The current mill rate for the South Peninsula Hospital service area is 2.3 mills or $230 per $100,000 of assessed value.

On a tour last Friday of the medical clinic and the hospital, hospital officials tried to show why the facilities need upgrades.

Prop 2 seeks $3 million for a 5,700-square-foot clinic expansion and $1.8 million for a new air handling and ventilation system. Built in 1986, the clinic has become overcrowded as it has acquired more patients — 9,000 over the last two years, more than 60 percent of the service area of 14,000 people.

The clinic expansion of the existing building at Bartlett Street and Fairview Avenue would add seven more examination rooms; more consultation, lab and imaging space; an expanded and secure medicine supply room; a conference room; more office space for doctors and other staff; a charting room; an expanded waiting room; a new roof, and more parking. It also would move the business office from leased space across the street.

Medical clinic office manager Rhonda Bradshaw lead the tour during the lunch break while patients weren’t in the clinic. In the administration office at the front desk, two or three employees were at the desk while several more worked behind a divider. At another table near where patients check out, four medical assistants demonstrated how crowded it could get if they all had to add notes to laptop computers.

At another table along the hallway to patient exam rooms, doctors updated their charts. The table also includes computer screens to show patients X-rays. There’s no other space for doctors to discuss imaging results with patients.

“That’s not private enough,” Bradshaw said.

Clinic doctors don’t have their own offices and work at stations along the wall in a conference room. So what if a patient receives a bad medical diagnosis?

“We have no room to counsel patients,” Bradshaw said.

Patient interaction happens in the exam rooms. That limits how many patients can be seen at a time. To keep visits moving smoothly, a nurse or medical assistant takes a patient’s vital signs — blood pressure, temperature, weight, etc. — in one room while the doctor visits another patients. Each doctor requires two examination rooms. With the current space, that’s three doctors in the clinic at a time. Adding seven rooms would mean 16 total rooms or eight doctors or providers at a time.

Lab and imaging space also can be crowded. Complicated X-rays for children or elderly have to be done at the hospital. Blood draws are done in a cubicle off the main exam room hallway, with a curtain for privacy. Patients who give urine samples have to carry bottles from the bathroom across the hallway. In the expansion, there will be a pass-through door.

Probably the most crowded room is the staff break room, where it’s standing room only. Bradshaw and SPH spokesperson Derotha Ferraro had staged some photo opportunities to show crowded areas, but for this one they didn’t have to. Three staff members ate lunch at a table while four more stood in the room.

Ferraro said hospital administration and the service area board were being conservative in the project and wanted something financially sustainable. The expanded medical center won’t include the West Wing, another clinic space in a building across Bartlett Street from that main clinic where pregnant woman and newborn babies are seen.

A 1970s-era heating, ventilation and air conditioning, or HVAC, system makes for less dramatic photos, but hospital officials say it’s also important to replace. A network of boxes, fans, ducts and filters, the system makes sure clean air gets into the hospital operating rooms at the proper temperature and humidity. While controls have been upgraded, the basic system is in need of replacement.

“It’s outlived its life cycle three to four times, probably,” said manager Glenn Radeke Jr.

Over the past 18 years, the number of surgeries a year also has more than doubled, from about 660 in 1997 to about 1,600 in 2015. At a presentation at the Homer City Council on Sept. 12, Ferraro noted that the HVAC system has become stressed by an increase in the number of hot days that exceed the average high temperature.

“It makes a difference when you’re trying to use a 40-year-old air conditioner in the operating room,” she said.

The hospital has mitigated the issue by adding portable air conditioners in the hallways of the operating room wing. It’s critical to keep the operating rooms within certain parameters of humidity and heat, said surgical services manager Janet Stookey. Staying within those parameters lessens the risk of infection.

“It’s creating a healthy environment for the best control,” she said. “It’s not a great sexy thing, but it’s important.”

Ferraro said both projects will happen even if voters do not approve the general obligation bond. The borough could go to Plan B and finance the projects itself, but at a higher interest rate. Currently the borough has applied for a conditional use permit from the city to expand the medical clinic. The Homer Advisory Planning Commission held a public hearing on Sept. 14, but postponed action so the borough could come up with a better drainage plan. Bids would be awarded in November, with construction anticipated to be done in the summer of 2017.

Design for the HVAC would be done this winter, with construction to start later this year or earlier in 2017, and the project completed in 2017.

Michael Armstrong can be reached at




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