California hospitals are staring down a $24 billion earthquake retrofit state-imposed deadline with few options for paying for this steep bill while maintaining quality services.
Senator George Runner’s (R-Antelope Valley) legislation that clarifies current law to allow district hospitals to be eligible for federally insured hospital loans through the US Department of Housing and Urban Development (HUD) passed the Assembly Banking and Finance Committee unanimously earlier this week.
“Our hospitals are in dire fiscal condition and this provides another option to help them meet the pending seismic retrofit deadline,” said Senator Runner.
Senate Bill 776 eliminates the technical problem in the law that prevents district hospitals from being considered seriously by HUD, and provides California hospitals the opportunity to access a HUD loan that can help make their hospitals safer. Hospitals can apply to HUD for up to $100 million per facility.
“Many hospitals are facing a serious financial situation and the purpose of this bill is to provide them with an option to access funds to help them modernize and seismically retrofit their facilities,” said Runner.
Accessing HUD’s hospital loan program would help alleviate this financial burden placed on California’s hospitals. Since the program’s inception, HUD has guaranteed nearly $10 billion in hospital loans, for some 325 hospitals. More than 90% of the funds loaned to date have gone to facilities east of the Rocky Mountains.
Assembly Banking and Finance Committee passed SB 776 with a 8-0 vote. It will be heard in Assembly Local Government Committee next week.