Phoebe board alters Palmyra loan agreement

Photo by Carly Farrell

Photo by Carly Farrell

ALBANY, Ga. -- In a called meeting Friday morning, the Phoebe Putney Memorial Hospital Board of Directors voted unanimously to amend its resolution relating to the funding of purchase of Palmyra Medical Center.

The board reworked its decision regarding a $100 million loan from Bank of America to allow for flexibility in regard to "working capital purposes in the ordinary course of business."

Phoebe CEO Joel Wernick said the board's action will allow the hospital more flexibility in how to spend the loan money that was intended to be used on the purchase of Palmyra while the FTC challenges Phoebe's acquisition.

Before the board's decision, the loan agreement limited funds specifically to the acquisition of assets by the Hospital Authority of Albany-Dougherty County in relation to the purchase of Palmyra.

The decision came after the board met for roughly 45 minutes in a closed-door session in the Willson Board room at Phoebe.

Georgia law allows boards to go into closed door sessions to discuss pending litigation, the acquisition of real estate or personnel matters.

On Thursday, U.S. District Court Judge Louis Sands granted temporarily a request by the Federal Trade Commission and the Georgia Attorney General's Office seeking an injunction to block the purchase from going through until an FTC's administrative hearing could be held in September. The FTC and the defendants will make arguments next month, after which Sands will decide whether to extend or lift the order.

The FTC contends that the acquisition would create a monopoly on health care in the six-county region around Dougherty County.

When asked for clarification of what Phoebe could use the funding for, lead counsel Tommy Chambless said its not limited strictly to the Palmyra purchase.

"Well, 'working capital in the ordinary course of business' broadens the potential use to many things that are not necessarily associated with the Palmyra project, and could include anything traditionally thought of as capital projects," Chambless wrote.

In addition to the change in the resolution, Wernick said the board had been briefed on the "recent events" involving the purchase.