A parcel tax that will help the struggling Doctors Medical Center stay afloat passed with nearly three-fourths of the vote on Tuesday.
The West Contra Costa Healthcare District, the public health care agency that operates the San Pablo, Calif., hospital, is trying to put together a financial fix for keep it from again going into bankruptcy.
The $47 parcel tax, which was passed during a special mail-in ballot election, will help raise $5 million annually for the district as a major part of improving its budget.
The hospital district reported an operating loss of $15.5 million in 2010 after operating losses of $13.2 million in 2009 and $18.8 million in 2008, according to the comprehensive audited financial report for 2010.
The district in Contra Costa County, northeast of San Francisco, filed for Chapter 9 bankruptcy in October 2006 under the yoke of financial problems similar to what it faces today. It emerged from Chapter 9 in 2008.
The previous bankruptcy left untouched the district’s $32 million of outstanding debt: $26 million of certificates of participation backed by parcel taxes and $6 million of privately held revenue bonds.
The health care district has $3.6 million of worth of debt obligations coming due this year.
The district must pay a debt service payment of $775,00 this year on the 2004 COPs and a final principal payment of $1.1 million for the revenue bonds, also issued in 2004.
The district had plans to refinance $23 million of outstanding certificates of participation.
Last month, Gov. Jerry Brown signed legislation that provides security to the bond investors in the form of a statutory lien, so that lenders would be assured they would be paid back even in the event of a bankruptcy.
