Waiting for approval

After the Platte Valley Healthcare Project (PVHP) submitted the original application for a Critical Access Hospital in June, the United States Department of Agriculture (USDA) responded with their comments and asked for additional clarification on certain areas of the hospital construction and operation.

Among the additional information requested was updated equipment costs and construction timelines as well as final costs, an updated 12-month working capital estimate and a sensitivity analysis incorporating COVID impact on the project.

“The USDA asked for greater detail on our medical equipment needs, and we were able to provide it all the way down to the push brooms,” George Haigh said. “We were also asked to provide updated land acquisition and site development costs as well as professional services expenses and told the USDA could move no further with our application until all of our numbers were completely up to date.”

Developing new financial projections was no easy task, Haigh said. General contractor Sletten Construction, their subcontractors, existing facility operator HMS, HGFA Architects and the local firm Engineering Associates had to compile new financial estimates so PVHP’s accounting firm BKD could professionally provide the updated information to the USDA.

In addition, Haigh said PVHP was asked to provide updated financials of the organization’s legal and operational costs, the current management company’s cash flow statement and balance sheet, and numbers and supporting documentation for grants that were awarded, as well as financial donations and commitments received to date.

One positive aspect of the delay is the timing of the loan application process occurred during a period of falling interest rates. Haigh said that since the original submission of the loan application the interest rate has dropped substantially, saving near $3 million in interest cost over the term of the loan.

BKD has been collecting and compiling all of the updated financials and supporting information required by the USDA, Haigh said, and PVHP will be able to submit a revised application in the next few days. He said the PVHP board and all of the teams involved remain optimistic that final approval will be received in a few weeks.