Louisiana Health Secretary Alan Levine on Monday said that the governor’s office is considering the termination of Louisiana State University’s legal affiliation with a proposed academic and charity hospital in New Orleans. The LSU board of supervisors has rejected a governing agreement for the facility that had been negotiated by Levine.

The proposed $1.2 billion complex would be financed in part with at least $400 million of revenue bonds to be issued by LSU. The hospital would serve as the teaching facility for LSU and the private Tulane University, and also treat indigent patients.

The bonds would be issued under the bonding authority already granted to the LSU system, but would be supported by the hospital’s revenue. The agreement calls for the LSU system to own the hospital and lease it to an independent body that would issue the revenue bonds.

LSU supervisors said the agreement put the financial burden on LSU for the debt, without a pledge of support from Tulane. The LSU board adopted a revised agreement that would give the state university more control how the hospital is governed.

Commissioner of Administration Angèle Davis said last week that the state would acquire no more land for the hospital until the dispute is resolved.

Levine said an independent entity, with neither university as the chief operator, could eliminate LSU’s concern that it would be responsible for the debt but have only limited control.

The main building at the proposed University Medical Center is to be named for Rev. Avery C. Alexander, a former state legislator and civil rights leader who died in 1999.

 

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