Riverside Healthcare gets $50 million of bonds

Newport News, Va.'s Industrial Development Authority on Friday approved issuing $50 million of revenue bonds on behalf of Riverside Healthcare Association so that the hospital group can fund $130 million of renovations and new projects at its facilities in Newport News and Gloucester and Essex counties.

Riverside must still get approval from the Newport News City Council.

If the City Council approves, Riverside can borrow money that will come from the sale of IDA-issued bonds, which are tax-exempt.

Newport News and the IDA are not on the hook for any of this money; the IDA is just a conduit for the bonds, said Florence Kingston, director of the city's Department of Economic Development. State law allows municipalities to issue bonds for the improvement of medical facilities, specifically for projects that would benefit its residents' health.

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As a hospital system, Riverside has tax-exempt status, meaning it can use municipal bonds if the city approves, according to Kingston and Peter Glagola, a Riverside spokesman.

Since most of the hospital's operations are based in Newport News, the IDA thought it was appropriate to honor the health care provider's request, Kingston said.

The $50 million will eventually help fund about $130 million in projects that Riverside sees happening over the next several years, according to a cost breakdown Glagola provided to the Daily Press. About $60.5 million of that work will happen in Newport News.

At Riverside Regional Medical Center, 500 J. Clyde Morris Blvd., that includes renovating and expanding operating rooms and relocating the neonatal intensive care unit to the east wing of the third floor. The Riverside Regional Medical Center Annex will also be renovated for medical office space, according to the breakdown.

The Gardens at Warwick Forest, 1004 Old Denbigh Blvd., a short-term rehabilitation facility, will get $15 million worth of renovations to its skilled nursing facility.

Glagola said a major highlight for Riverside is purchasing and implementing a new medical record-keeping and billing system.

"Right now we have a couple different systems that talk to one another," Glagola said.

That revamp is supposed to cost $11 million. The single most expensive project is for Riverside Walter Reed Hospital in Gloucester County. That involves revamping its emergency, surgery and patient room areas, as well as other infrastructure upgrades.

The remaining $23.5 million renovations are for Riverside Tappahannock Hospital in Essex County. That includes mechanical, electrical and plumbing upgrades, and renovations to the lab, operating room and its medical office building.

The list of future capital projects comes as Riverside continues major renovations at its facilities.

At Riverside Regional, crews are working on a $67 million project to add floors to its Pavilion. In June 2015, the health system planned out an estimated $296 million to renovate or expand its facilities in Newport News, James City County and Gloucester County through 2020. At the time, Newport News officials approved the nonprofit's request for $125 million in tax-exempt bonds as partial financing for 12 different projects.

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