On an annual basis through the life of Phoebe North’s lease, Phoebe Putney Health System officials say they will be making payments to be used for the same purposes as ad valorem tax on the properties acquired through the hospital’s purchase.
ALBANY, Ga. — As the U.S. Supreme Court prepares to hear the case regarding the Federal Trade Commission’s opposition to the purchase of Palmyra Medical Center, now known as Phoebe North, the Phoebe Putney Memorial Hospital board is actively working on the process of getting the hospital fully operational.
Among the most recent items included the issue of payments in lieu of taxes for the properties connected to the acquisition, an official recognition of the Phoebe North name and approval of an amended and restated lease for Phoebe Putney Memorial Hospital.
The hospital board approved an agreement, known as the “VPILOT Agreement,” that commits officials to make annual payments in lieu of taxes on the properties acquired by the Hospital Authority of Albany-Dougherty County as a result of the purchase of Palmyra.
Tommy Chambless, senior vice president and general counsel for Phoebe Putney Health System, said officials had considered this an important element so that the $195 million purchase of the 18 properties included in the acquisition would not be detrimental financially to Dougherty County taxpayers.
“It was a sense of obligation that it not have an impact on the tax base,” he said. “It has always been our intent to legitimize the commitment made to make sure the tax base is not impacted.”
The payment for this calendar year — set to be paid on or before Dec. 20 — will be in the sum of $376,612.01, the amount of ad valorem tax paid with respect to the acquired tangible properties in 2011, the agreement states.
The agreement further states that the payment may be affected by future changes in the Dougherty County millage rates as well as future changes reflecting the fair market value of Phoebe North properties.
“In the event of a general millage rate increase by Dougherty County, Georgia, the City of Albany, Georgia, or Board of Education of Dougherty County, the amount of payment made hereunder shall be adjusted so that the amount of payment to the Tax Director shall be in an amount equivalent to that payment which would be owed if the subject property were subject to taxation,” the agreement reads.
The agreement takes hold on Aug. 1, the same date officials have set for a lease to be in place for Phoebe North, and will continue for the life of the lease, Chambless said.
Since its acquisition in December, Phoebe North has been operating under the terms of a management services agreement as the process of drafting a lease has been ongoing.
Over the last several months, while the hospital has been called Phoebe North, it had not been officially said that the hospital would be going by that name — which led to a move on Wednesday to formally approve “Phoebe North” as the practice location name for the facility.
“This is an official declaration of the body (the Phoebe Putney Memorial Hospital board) that we are calling it Phoebe North,” said Chambless.
The amended and restated lease for Phoebe Putney Memorial Hospital also approved on Wednesday, officials say, serves as a continuation of the lease in place since 1990.
“(The document) takes after the existing lease, except for where it needed to be modernized,” Chambless said before the board.
The document, expected to be executed by Aug. 1, includes a provision for an account balance of $100,000 in the name of the Hospital Authority and accounts for Phoebe North, officials say.
It is expected to be presented to the Authority, which has a meeting scheduled for 7:30 a.m. Wednesday.