============================================================ Health Options Digest February 1, 2003 Coalition for Health Options In Central Eugene-Springfield ============================================================ * CORRECTION * EDITOR'S LETTER * NEWS SUMMARY * PULSE POLL 1.sn - Pulse Poll: Is McKenzie-Willamette partnership with Triad a good idea? * CALENDAR 2.sn - Tue 2/4 - Springfield Planning Commission 3.rg - PeaceHealth on the agenda * PEOPLE SPEAK OUT ON PEACEHEALTH'S PLANS 4.rg - Editorial: How high a hospital? Height limit is arbitrary, counterproductive 5.rg - Letter: Impeding progress 6.rg - Letter: Limits not arbitrary * COUNTY COMMISSIONERS CONSIDER WEIGHING IN 7.ew - Slant: County commissioners consider weighing in 8.rg - County might weigh in on hospital project * MCKENZIE-WILLAMETTE/TRIAD PARTNERSHIP 9.rg - Springfield hospital links with big chain 10.rg - Struggling hospital has attractive assets 11.rg - Triad agrees to build new hospital 12.sn - Triad to become majority owner of McKenzie-Willamette Hospital 13.sn - Community joined together to fund 'Help it Grow' project 14.rg - Editorial: Triad alters hospital mix: Partner strengthens McKenzie-Willamette 15.sn - Editorial: Hospital partnership will be interesting to watch * NEW HOSPITAL SITE 16.rg - Site is unknown, but Eugene is most likely 17.rg - Fairgrounds no shoo-in for hospital 18.rg - Land swap idea draws tepid response * ARLIE PROPOSAL 19.ac - Potential Hospital Sites 20.ac - Hospital Siting Proposal 21.ac - Arlie Shares Idea to Secure Hospital Site and Relocate Lane County Fairgrounds 22.ac - Fairgrounds Site Proposal * LYLE HATFIELD 23.sn - Springfield Chamber winners work for the community 24.rg - Springfield councilor kept commitment to the end 25.sn - Editorial: Hatfield will be missed * OTHER NEWS * KEY, CREDITS, MORE INFO ======================= Correction ======================= Last week, I suggested the artistic renderings released last August indicated that PeaceHealth was originally planning a hospital of just four or five stories on the RiverBend site. In fact, PeaceHealth explains that their plans all along have been to build a hospital of nine stories or so -- the 130 to 145 feet referred to in recent news stories. The artistic renderings appear to show only four stories because "using angles, terraces and rooftop gardens, [PeaceHealth] can makes sure [the hospital]'s not the skyscraper critics claim it will be." We regret our error. As more detailed information becomes available, we urge PeaceHealth to update their web site so that the public has access to accurate, up-to-date information about their plans. -- Rob Zako ===================== Editor's Letter ==================== The past week has been full of stunning news, some good, some bad (and some of it over the skies of Texas, pulling our attention away from Lane County concerns). I was surprised and deeply saddened to learn that Springfield City Councilor Lyle Hatfield passed away on Friday. I last saw Lyle a couple weeks ago at the Metropolitan Policy Committee meeting, and was looking forward to working with him on an MPC subcommittee on county-wide transportation issues. While Lyle and I disagreed on policy issues more often than not, I greatly respected his efforts and counted him as a friend. I will miss him and know that the City of Springfield will miss him dearly. Until the very end, he devoted himself tirelessly to the city he loved. Of course, earlier in the week we learned that McKenzie-Willamette Hospital has struck a deal with Triad, a Texas-based, for-profit hospital chain. The deal appears to rescue McKenzie-Willamette from its financial woes and to provide $80 million for McKenzie-Willamette to construct its own new hospital. The Register-Guard editorialized: "Watching PeaceHealth and McKenzie-Willamette Hospital scramble for position in Eugene-Springfield is like trying to follow a chess match in which half the pieces are hidden from view. Just as an observer begins to get a feel for the game, an unexpected knight's move alters the balance on the board. The knight in this case is Triad Hospitals Inc." Similarly, the Springfield News editorialized that "there's a new player in town." The said they "will be watching with great interest because how this all plays out will have a great impact upon the city of Springfield." Even John Musumeci, who has sometimes been reluctant to publicize his views, said on Friday: "We need to put Eugene into the game, and and we're looking for ways we can help." I am struck by how all three comments look at the decisions about where and how to site two new hospitals as a game -- a game with the public in the role of spectators. Of course, in a sense, it is a game. Business is a game, and health care is a big, big business. But decisions made by the two local hospitals are *not* comparable to, say, decisions made by Sony or Hynix. Those business manufacture CDs and memory chips that are sold all over the world. In turn, local residents are free to purchase CDs and computer chips manufactured elsewhere. In contrast, hospitals are more like local utilities: If you don't like the choices available locally, most of us really don't have an option to go to a hospital in Texas or Taiwan. Our two hospitals are vital parts of our community. While where and how they build new facilities obviously affects their businesses, it also affects the choices available to everyone else in the community. We need to stop thinking about these decisions as some kind of game, as a spectator sport we follow on TV and in the newspapers. We need to find away to switch from playing a game to coming together to figure out what is best for the community. Indeed, the "game" has now gotten so complicated and involves so many potential "players" -- PeaceHealth, McKenzie-Willamette, Triad, Springfield, Eugene, Lane County, the State of Oregon, and perhaps even Arlie -- that I doubt anyone can really anticipate all the "moves" and come out with a good chance of "winning." Let's stop playing games and work together for the health of our community. Rob Zako, Editor 343-5201 rzako@efn.org ====================== News Summary ====================== This week, the Springfield news is conducting a Pulse Poll: "McKenzie-Willamette Hospital is entering a partnership with Triad. Is this a good idea?" Visit their web site to register your opinion (#1). On Tuesday, the Springfield Planning Commission will review language prepared by the city attorney reflecting their desire to impose conditions on approval of the PeaceHealth plan amendments (#2-3). The suggestion that their be a 60-foot height limit on the new hospital drew criticism from the Register-Guard and one of its readers, as well as an explanation from one of the Springfield Planning Commissioners (#4-6). Lane County commissioners may want to have a say in whether PeaceHealth gets to build its planned $350 million regional medical complex on a 165-acre site in northwest Springfield (#6-7). Triad Hospitals Inc., the nation's third-largest for-profit hospital chain, will become the majority owner of McKenzie-Willamette Hospital under a preliminary partnership agreement signed Thursday (#9-13). The Register-Guard editorializes that "now it looks as though McKenzie-Willamette will obtain the resources to respond to that competitive threat with a new hospital of its own, and this may not be the last time an unexpected move rearranges the chessboard" (#14). The Springfield News editorializes that they "will be watching with great interest because how this all plays out will have a great impact upon the city of Springfield" (#15). Eugene may get a new hospital after all: The city is probably the leading contender for a new McKenzie-Willamette Hospital -- built from scratch with $80 million from a Texas-based partner (#16). The 56-acre Lane County Fairgrounds property on West 13th Avenue has been on a short list of potential hospital sites identified by the city of Eugene since PeaceHealth announced it would move Sacred Heart Medical Center out of central Eugene to the Gateway area of Springfield (#17). But a proposal made public Friday by land dealer John Musumeci to put the proposed new hospital at the Lane County Fairgrounds and move the fairgrounds to 100 acres of forestland Musumeci owns south of Lane Community College appears headed for resistance when county commissioners take up the matter on Wednesday (#18). On Friday, John Mucumeci, vice president of operations for Arlie & Company, held a press conference to discuss a proposal to swap the 56-acre Lane County Fairgrounds site for a 100-acre owned by Arlie south of LCC and outside of Goshen (#19-22). On Friday, Springfield City Council Lyle Hatfield passed away after a four-year battle against Hodgkin's disease. He is survived by his wife, Alice, and three children. (#23-25). ======================= Pulse Poll ======================= ------------------------------------------------------------ 1.sn - Pulse Poll: Is McKenzie-Willamette partnership with Triad a good idea? ------------------------------------------------------------ Q&A: McKenzie-Willamette Hospital is entering a partnership with Triad. Is this a good idea? To vote, visit: http://www.springfieldnews.com/ ======================== Calendar ======================== ------------------------------------------------------------ 2.sn - Tue 2/4 - Springfield Planning Commission ------------------------------------------------------------ Tuesday 6 p.m. -- Planning Commission work session, Jesse Maine Room, Springfield City Hall, 225 Fifth St., 726-3753. * Update on Storm Water Management Program plan development. * Review of PeaceHealth recommendation plan amendment. 6:30 p.m. -- Planning Commission Committee for Citizen Involvement, Jesse Maine Room, Springfield City Hall, 225 Fifth St., 726-3753. * Storm water permit public involvement. http://www.springfieldnews.com/articles/2003/01/31/calendar/news1.txt Agenda: http://www.ci.springfield.or.us/dsd/Planning/PC%20Agenda%20&%20Minutes/2003/Work%20Agenda/February%204%202003.pdf ------------------------------------------------------------ 3.rg - PeaceHealth on the agenda ------------------------------------------------------------ By Matt Cooper The Register-Guard, 2/1/03, Page 1B The Springfield Planning Commission has a little PeaceHealth housekeeping to do Tuesday. The commissioners gave the health agency's proposed regional hospital complex a 4-2 approval Jan. 22 and sent it to the City Council, which will begin its review of the project Feb. 18. The commissioners tacked on some nasty conditions, however. They want the buildings to be no taller than 60 feet, and they want the property to be used for medium-density housing if the project ends up being rejected. City Attorney Joe Leahy is still researching the legality of the height restriction, but staff hopes to have language reflecting the commissioners' wishes available for review by Tuesday's commission meeting, Planning Manager Greg Mott said. PeaceHealth may fight the height restriction at the council level, said Philip Farrington, PeaceHealth development director. "It is a rather arbitrary figure that has a great potential to compromise patient care," he said. Springfield reporter Matt Cooper can be reached at 338-2317 or by e-mail at mcooper@guardnet.com http://www.registerguard.com/news/2003/02/01/1b.cr.spcitybeat.0201.html ========= People Speak Out on PeaceHealth's Plans ======== ------------------------------------------------------------ 4.rg - Editorial: How high a hospital? Height limit is arbitrary, counterproductive ------------------------------------------------------------ Editorial The Register-Guard, 1/26/03 The only predictable thing about the PeaceHealth drama is that each new act brings fresh surprises. So it was on Wednesday, when the Springfield Planning Commission recommended approval of a new hospital complex in the Gateway area -- but said its tallest building should be no higher than 60 feet. The commission lopped the top half off of what PeaceHealth had envisioned as an eight- or nine-story hospital. The Planning Commission's authority to impose such a restriction is unclear -- though a 60-foot limit is already on the books for mixed-use commercial buildings, PeaceHealth's proposal is different both in kind and in magnitude. But even if the commission can prescribe a height limit, the Springfield City Council should rescind it. It's plain that if PeaceHealth is allowed to develop its RiverBend site as a hospital complex, a vertical structure would be preferable. One of the reasons PeaceHealth was attracted to the RiverBend site is that its 160 acres afford the opportunity to build a regional medical center while leaving lots of open space, creating what hospital officials describe as a "healing environment." If PeaceHealth can't build up, it will have to build out. The 60-foot limit would force it to cover twice as much land to obtain the desired number of square feet of floor space. A lot of the RiverBend site's open space would be covered in concrete as a result. PeaceHealth officials aren't certain they can build the hospital they want with buildings no more than 60 feet high. The hospital would be more spread out, meaning patients and personnel would have to travel farther between various departments. PeaceHealth's architects are scrambling to determine whether a lower-profile hospital would be practical. If it's not, the Planning Commission might as well have withheld its approval on Wednesday. The height limit is apparently the result of an aesthetic judgment -- planning commissioners didn't want something resembling a skyscraper near the banks of the McKenzie River. Two squat buildings, however, would be no more visually appealing than a single tall one. And even at its full planned height of 130 to 145 feet, PeaceHealth's main building at RiverBend would be wider than it is high, at least as envisioned in architects' sketches. A primary advantage of the RiverBend site is that it would allow PeaceHealth to build a hospital without making corner-cutting compromises. The Planning Commission's height restriction -- approved even before PeaceHealth has submitted its master plan for developing the RiverBend site -- weakens that advantage. The City Council, when it meets in March to review the commission's approval of the RiverBend proposal, will face a tough choice. But if the council decides to accept the recommendation, it should let PeaceHealth put the top floors back on. http://www.registerguard.com/news/2003/01/26/ed.edit.highhospital.0126.html ------------------------------------------------------------ 5.rg - Letter: Impeding progress ------------------------------------------------------------ By Larry M. Chase, Springfield Letter to The Register-Guard, 1/31/03 The Eugene City Council succeeded in running Sacred Heart out of town. It now appears that the Springfield Planning Commission is attempting to do the same thing by limiting the height of the new hospital. Most communities would welcome a new state-of-the-art hospital, but not Springfield and Eugene. We would rather wallow in procedural pettiness. I am surprised that PeaceHealth officials haven't thrown up their hands and said, "Forget the whole thing." I would not blame them if they did. This is the 21st century, folks. Impeding progress is not a virtue. http://www.registerguard.com/news/2003/01/29/ed.letters.0129.html ------------------------------------------------------------ 6.rg - Letter: Limits not arbitrary ------------------------------------------------------------ By Greg A. Shaver, Member, Springfield Planning Commission, Springfield Letter to The Register-Guard, 1/31/03 The height limitations that the Springfield Planning Commission placed upon the Gateway-area land where PeaceHealth intends to build its new hospital are not an arbitrary limitation. If anything was arbitrary, it was PeaceHealth's unilateral decision to build a regional hospital on our urban fringe, next to a scenic waterway, in an area where the tallest building is three stories and on land zoned exclusively for residential use. If PeaceHealth chose instead to build in the downtown core of either city, such limitations would not have been considered. An argument can be made that the commission was, if anything, too liberal in increasing the existing height limitations of 35 feet to the taller 60 feet. The foresight of our commission's attempt to limit the negative impacts on both the neighborhood and the view shed of all our residents should be commended not condemned. Perhaps The Register-Guard should reprint the letters and editorials the newspaper ran after the construction of Eugene's Ya-Po-Ah Terrace to refresh our collective memory on what wonders can spring up without those supposed arbitrary limitations in place. http://www.registerguard.com/news/2003/01/31/ed.letters.0131.html ======== County Commissioners Consider Weighing In ======= ------------------------------------------------------------ 7.ew - Slant: County commissioners consider weighing in ------------------------------------------------------------ The Eugene Weekly, 1/30/03 We hear Lane County commissioners are considering weighing in on what Springfield asserts is their decision about the land use plan amendments required for PeaceHealth to build at Gateway. Nothing formal was announced by press time, but the hospital project could on the commissioners agenda Feb. 4 or 5. The county and other local jurisdictions should demand a major voice in this siting, even veto power, since this massive development will effect all of us in both predictable and unanticipated ways. For example, how many more children will develop asthma if we increase vehicle miles traveled to get medical care? http://www.eugeneweekly.com/news.html#shorts http://www.eugeneweekly.com/archive/01_30_03/news.html#shorts ------------------------------------------------------------ 8.rg - County might weigh in on hospital project ------------------------------------------------------------ By Matt Cooper The Register-Guard, 1/29/03, Page 1B Lane County commissioners may want to have a say in whether PeaceHealth gets to build its planned $350 million regional medical complex on a 165-acre site in northwest Springfield. The five members of the board of commissioners will take up the matter Feb. 5, when they'll talk about whether the proposed project could worsen traffic congestion in the Gateway area and otherwise adversely impact county residents. If they decide that it would, they may write a letter asking city officials to address their concerns. But what the letter would say -- and whether there even is a letter -- will depend on whether a consensus emerges at the meeting. South Eugene Commissioner Pete Sorenson, the board chairman, is the most outspoken in favor of entering into the city's decision. "There should be a regional approach of finding the best site," he said, "and putting a major facility like this on the edge of the urban growth boundary causes me some concerns about the implications for the urban growth boundary and the livability for the entire metropolitan area. "This affects the lives of everybody in the county and ... we ought to be examining this," Sorenson said. Springfield Mayor Sid Leiken said he was unconcerned by the prospect of the county commissioners joining in the project's review, citing agreements between the local governments to stay out of each other's business. He suggested that Sorenson is mostly concerned with what's best for his south Eugene constituents, who would be farthest from the new hospital if Sacred Heart moves from Hilyard Street in downtown Eugene to the Gateway area. "I hope he looks at this from a land use perspective," Leiken said, "and not a personal statement." West Lane Commissioner Anna Morrison said she hadn't seen any evidence that warrants the county getting involved. "The overall conditions really reside with the city of Springfield," she said. The other three commissioners fall somewhere between Sorenson and Morrison, and that could mean the difference between the commissioners fighting for review power as a board or simply making statements as individual elected officials. Springfield Commissioner Bill Dwyer agreed the project is a regional issue but said when the commissioners meet he wants to identify the negative impacts the county "will be asked to try to cure." North Eugene Commissioner Bobby Green wants no part of the debate as long as the hospital is located in Springfield or Eugene, but said the county should "opt in" if it's determined the project violates state land use laws or the Eugene-Springfield Metropolitan Plan, the area's blueprint for future growth. East Lane Commissioner Tom Lininger said his position in the matter will hinge on having a better understanding of the rules that distinguish city land use issues from regional ones. He added, however, that "if regionwide and interdistrict planning are good ideas, (the PeaceHealth project) is certainly one of them." If a consensus or a majority opinion emerges from next week's meeting, Sorenson said the board could write a letter asking Springfield to address its concerns. His hope is that the city would respond concurrent with its planned public hearing on the PeaceHealth project Feb. 18, and prior to the City Council's expected vote in March. Another option, Sorenson said, would be asking the Metropolitan Policy Committee to resolve concerns among the three governments, which includes the city of Eugene. If the city approves the project, the commissioners may wait to see if opponents appeal to the state Land Use Board of Appeals on the grounds that Springfield alone ruled on what's rightfully a regional decision, Sorenson said. The commissioners could also could pursue such an appeal, he added. City planner Colin Stephens, the project manager, said the commissioners -- like the general public -- are welcome to submit testimony either as a board or as individuals, prior to the City Council's decision. But there is no way for the commissioners to enter into the city's review of the project before that decision, nor any reason for them to do so, Stephens said. The sole land use change proposed by PeaceHealth that would warrant the county's consideration is a change to the Metro Plan to convert up to 33 acres of the site from medium-density residential land to community-commercial use, Stephens said. But the hospital is not planned on that part of the site -- the 33 acres is meant for an urban village and medical office use -- and the Metro Plan makes it clear that such a change is solely the jurisdiction of the host city, Stephens said. The other changes "all affect properties within the city limits," Stephens said, which means that, barring an invite from the City Council, the commissioners' only recourse for intervention would be to the state appeals board, after the city has made its decision. "If they felt they had standing that would make them a decision-maker I would assume they could use that on appeal," Stephens said. http://www.registerguard.com/news/2003/01/29/1b.cr.peacehealth.0129.html ========== McKenzie-Willamette/Triad Partnership ========= ------------------------------------------------------------ 9.rg - Springfield hospital links with big chain ------------------------------------------------------------ By Joe Harwood and Matt Cooper The Register-Guard, 1/30/03, Page 1A Springfield -- If you're going to marry for money, you might as well choose a billionaire. So it will be for McKenzie-Willamette Hospital, which apparently has found a wealthy spouse in Triad Hospitals Inc., the third-largest for-profit hospital chain in the United States. Faced with declining revenue and patient counts, along with pressure from a larger competitor, cash-strapped McKenzie-Willamette during the past several months has been quietly searching for a financial partner with deep pockets to keep the independent, nonprofit hospital afloat. [PHOTO: Roy Orr is CEO of McKenzie-Willamette Hospital, which reportedly has signed a deal with a major medical chain.] McKenzie-Willamette is expected to announce this morning that the search is over and it has signed a deal with Texas-based Triad. Details of the arrangement -- for example, whether Triad would buy McKenzie-Willamette or form some kind of partnership -- were not clear Wednesday. It also was unclear what Triad would do with McKenzie-Willamette. Many local observers were speculating that Triad would build a new hospital for McKenzie-Willamette in west Eugene, to serve a city that would be left without a major hospital if PeaceHealth is able to win approvals to build a new hospital in Springfield's Gateway area. McKenzie-Willamette spokeswoman Rosie Pryor declined to comment, and Triad officials did not return phone calls to The Register-Guard. But several local officials familiar with the situation, Springfield Mayor Sid Leiken among them, said Triad and McKenzie-Willamette had struck a deal. "Triad is very, very excited about the prospects of being involved in the community, and the McKenzie-Willamette board and leadership is very excited about the agreement that has been made," Leiken said Wednesday morning. Leiken later partially recanted, saying he was unsure whether the partner was Triad. McKenzie-Willamette has scheduled a news conference for 9:30 a.m. today for "an important announcement." Long before word leaked out about the Triad deal, officials with the Springfield hospital said they would most likely have to move from the current location off Mohawk Boulevard in midtown in order to stay competitive. That's because PeaceHealth, based in Bellevue, Wash., is seeking city approval to build the $350 million RiverBend regional medical facility in Springfield's Gateway area, a scant 2 1/2 miles away. Critics of PeaceHealth have seen the out-of-state health organization as bullying the smaller Springfield hospital, but Triad's entrance would completely turn the tables: Triad has about four times the annual revenue of PeaceHealth. [PHOTO: Sid Leiken] In Triad, McKenzie-Willamette would get not only a partner with plenty of cash but an experienced health care management company with the clout and resources to compete against PeaceHealth's Sacred Heart Medical Center in downtown Eugene. Based in Plano, Texas, Triad operates 48 hospitals and 14 ambulatory surgery centers across the country. Through a subsidiary, it also provides hospital management and other services to more than 200 independent community hospitals and health systems in 43 states. For the first nine months of 2002, fast-growing but debt-laden Triad posted sales of $2.6 billion, up 44 percent from the same period a year earlier. Triad's total revenue will exceed $3.3 billion for 2002. McKenzie-Willamette appears to fit with Triad's business model. More than 75 percent of Triad-owned hospitals are in small cities with populations of less than 150,000, and those facilities are usually either the only hospital in town, or one of two or three hospitals in the community. Triad's only other facility in Oregon is the Willamette Valley Medical Center in McMinnville. Ken Rutledge, president of the Oregon Association of Hospitals and Health Systems, said the merger should be positive for McKenzie-Willamette and the Eugene-Springfield area. The association represents the 61 hospitals in the state. "Triad, because it is a large system, adds resources, capital and allows you to spread your fixed administrative costs over a broad corporate structure," Rutledge said, adding that he had no direct knowledge of the deal and was commenting in general terms. The deal also could provide McKenzie-Willamette "with a lot of expertise that a small community hospital may not have," he said, "things like regulatory issues, computer systems and the acquisition of medical technology." Rutledge said his experience with the Triad facility in McMinnville has been positive. "They are a solid community partner and there is a very positive working relationship with the physicians in McMinnville," he said. Whether McKenzie-Willamette will stay in Springfield after Triad's arrival also is unclear. "As of right now, as we speak, the intention is to continue to operate out of the location that is there now," Leiken said. Triad's behavior over the past 12 months provides some clues. The company last year started negotiations to acquire two hospitals in West Virginia and North Carolina. As part of the proposed transactions, Triad agreed to lease the existing hospital buildings while it constructed new "replacement" facilities at a combined cost of $103 million, according to company filings with the U.S. Securities and Exchange Commission. Triad last year also started talks to become the majority partner of a nonprofit hospital in Palmer, Alaska. The company plans to build a new $75 million hospital in Palmer if it strikes an agreement with the nonprofit, according to SEC filings. Triad is now building a replacement hospital in Bentonville, Ark., for $63 million; a new hospital in Mesquite, Nev., for $20 million; and a new hospital in Tucson, Ariz., for $85 million, according to SEC filings. Triad's most recent filing with the SEC said the company was exploring opportunities with other nonprofit hospitals, but didn't provide specifics. The company has plenty of cash to acquire existing hospitals and build new ones. The company four months ago received the green light from the SEC to raise $800 million by selling bonds and others securities. In its third-quarter 2002 financial report, Triad said it had long-term debt of $1.6 billion. In part because of its huge debt payments, Triad has reported skimpy profits. In 2001, it earned a profit of just $2.8 million on sales of $2.6 billion. If McKenzie-Willamette and Triad decided to exit Springfield because of the PeaceHealth project, where would they put a new hospital? One rumor has McKenzie-Willamette building a new hospital at the Lane County Fairgrounds west of downtown Eugene. With PeaceHealth seeking to move the bulk of its patient operations to Springfield from the Sacred Heart campus at Hilyard Street, the fairgrounds makes for a fairly central location for a Eugene hospital, real estate experts said. Eugene City Manager Jim Carlson said he hasn't spoken with McKenzie-Willamette since last year, when officials identified the fairgrounds as one of a number of viable hospital sites in the city. Local observers say the fairgrounds could be moved to the Bethel-Danebo area or perhaps to land south of Lane Community College owned by Eugene real estate firm Arlie & Co. John Musumeci, who runs Arlie's land-trading operations, said putting a hospital at the fairgrounds and moving the fairgrounds to Arlie land was "complicated" and declined to say whether his company is involved. "If (McKenzie-Willamette) wants to contact us for the purpose of helping them relocate, we would be very happy to work with them," Musumeci said Wednesday. "No one at Arlie has gone to McKenzie-Willamette to ask them about relocation." The 1,100 acres Arlie owns to the south of LCC lies outside the urban growth boundary and is zoned for forest uses. Musumeci wants to develop the land, but is precluded by land use rules from building more than a handful of homes there. Moving the fairgrounds there would require changes to the Eugene-Springfield Metropolitan Area General Plan. Eugene Mayor Jim Torrey said the pending Triad announcement is good news for Eugene because it preserves competition between McKenzie-Willamette and PeaceHealth. McKenzie-Willamette a year ago sued PeaceHealth, alleging that PeaceHealth is wielding its dominant market power in Lane County to engage in predatory business tactics to drive the smaller hospital out of business. McKenzie-Willamette alleged that PeaceHealth has negotiated contracts with insurers to steer patients to Sacred Heart and away from the smaller Springfield hospital. PeaceHealth denies that it is breaking any laws. Torrey also suggested that Eugene -- more than twice Springfield's population but facing the prospect of being without a primary hospital should PeaceHealth build in Springfield -- may be the ultimate destination for McKenzie-Willamette. "I've got to believe, if (Triad) is going to be a good competitor as opposed to just barely keeping McKenzie-Willamette afloat, I would bet before they're done they're going to be considering Eugene as a site," Torrey said. Torrey said he doesn't support financial handouts or property condemnations to attract a hospital, but he said he would push to speed up the permitting process, work with hospitals on zoning and land use changes and streamline the litigation processes available to opponents. Triad was spun off from hospital chain giant HCA in 1999 after a prolonged government health fraud investigation into HCA. Since 2000, HCA has paid more than $1 billion in civil and criminal fines and other compensation to the federal government for Medicare-related fraud and overbilling, according to SEC filings. After its spinoff, Triad bought a string of hospitals in the Sunbelt states. In 2001, the company acquired Quorum Health Group Inc. for $2.4 billion in cash and stock as part of an expansion drive into the Southeast and Midwest. Triad and Quorum, another HCA spinoff, are still struggling with issues related to fraud and overbilling at HCA. http://www.registerguard.com/news/2003/01/30/1a.triad.0130.html ------------------------------------------------------------ 10.rg - Struggling hospital has attractive assets ------------------------------------------------------------ By Christian Wihtol, Business Editor The Register-Guard, 1/30/03, Page 1A Springfield -- If Triad Hospitals Inc. buys or partners up with McKenzie-Willamette Hospital, what exactly will it be getting? A small, financially struggling hospital that's losing money and also losing patients to PeaceHealth's Sacred Heart Medical Center, its larger and financially thriving rival? Or a low-cost way to quickly gain a foothold in a sizeable West Coast market that holds solid long-term growth prospects? Perhaps a bit of both. The Springfield nonprofit hospital's two biggest attractions to a buyer might not be immediately apparent. The first is simply that McKenzie-Willamette is an existing, state-approved hospital. McKenzie-Willamette can boast an established patient base, largely in Springfield, plus community support and name recognition. Second, there's McKenzie-Willamette's pending antitrust lawsuit against PeaceHealth. McKenzie-Willamette is seeking $35 million in damages. If PeaceHealth has to pay damages, those spoils could go to McKenzie-Willamette's new owner or partner. But beyond these two elements, McKenzie-Willamette is hardly a choice operation. It typically turns only a very small annual profit -- the excess of revenues over expenses -- and it has built up only a small reserve fund as a financial cushion. Bringing in a big financial partner may be the only way the hospital can survive financial and legal pressure. The hospital's main physical asset is its complex off Mohawk Boulevard, plus adjacent property -- vacant land and about a dozen low-quality rental houses. What the complex is worth is unclear. McKenzie-Willamette's financial reports place the original value of the hospital and its equipment at $58 million. But that's probably far more than their current market value. The hospital's financial shape might be described as mediocre. McKenzie-Willamette hasn't released its 2002 financial report yet. But the hospital says it is losing money because it is losing patients covered by commercial insurance. McKenzie-Willamette blames that on illegal monopolistic pricing by PeaceHealth at its Sacred Heart Medical Center in Eugene. PeaceHealth denies its arrangements with commercial health-care insurers violate any laws. The number of patients at McKenzie-Willamette covered by government Medicare, Medicaid and Oregon Health Plan programs is rising gradually, according to figures released by McKenzie-Willamette. But the volume of patients covered by commercial health plans dropped 28 percent from the first half of 2001 to the first half of 2002, McKenzie-Willamette CEO Roy Orr has said. That's hurting the hospital because the government won't pay the hospital the full cost of providing care to government-insured patients, Orr said. To make up the difference, the hospital must rely on a dwindling pool of patients covered by higher-return private insurance, he said. Over the years, McKenzie-Willamette has pursued a thrifty, slow-growth strategy, while rival PeaceHealth has boomed. McKenzie-Willamette's revenues have grown steadily in the past decade, from $38.6 million in 1992 to $74 million in 2001, according to the hospital's financial reports. During that time, the hospital has paid down debt that it took on to expand the Mohawk campus in the late 1980s. The hospital's long-term debt now stands at a modest $9 million. But after covering operating expenses and debt payments, the hospital rarely has much left over to set aside for a rainy day. From 1992 through 2001, the hospital on average netted a profit of just $1.4 million a year, according to the hospital's financial reports. In 2001, the hospital had a profit of $1.9 million on revenues of $74 million, or a profit rate of 2.6 percent. McKenzie-Willamette Chief Financial Officer Karen Francis says she'd like the profit rate to be in the vicinity of 4 percent. By contrast, PeaceHealth in 2002 had a profit of $43.5 million on revenues of $768 million, or about a 6 percent profit rate. McKenzie-Willamette's capital projects fund was $7.3 million as of Dec. 31, 2001. Much of that was in stocks and mutual funds, according to the hospital's financial reports. Given the stock market plunge of recent months, the value of the capital reserve now is likely lower. PeaceHealth has capital reserves of $288 million. One odd asset of McKenzie-Willamette is the property it has bought next to its complex. Planning an eventual expansion, the hospital from 1996 through 2000 spent just less than $2 million on the acquisitions, according to real estate records. It bought about a dozen rental homes that line both sides of H Street immediately east of the campus, and it bought a small vacant field southeast of the campus. The hospital wanted a developer to lease some of the land and put up a four-story building for medical clinics and offices. Eugene developer Wally Graff signed up for the project but dropped it once he saw in mid-2001 that PeaceHealth wanted to build its new hospital in the Gateway area. "With the prospect of PeaceHealth coming into the community, I don't believe this is the right climate to put up an office building" next to McKenzie-Willamette, Graff said. Given a choice, medical professionals would prefer to be at the PeaceHealth Gateway campus, he said. http://www.registerguard.com/news/2003/01/30/1a.triadside.0130.html ------------------------------------------------------------ 11.rg - Triad agrees to build new hospital ------------------------------------------------------------ By Joe Harwood The Register-Guard, 1/31/03, Page 1A Springfield -- Triad Hospitals Inc., the nation's third-largest for-profit hospital chain, will become the majority owner of McKenzie-Willamette Hospital under a preliminary partnership agreement signed Thursday. Under the deal, Texas-based Triad will provide approximately $80 million in cash to develop and build a new 114-bed hospital for McKenzie-Willamette somewhere in the Eugene-Springfield area. McKenzie-Willamette and Triad officials said they haven't chosen a site yet, but did say they were looking for about 35 acres to build a 180,000- to 220,000-square-foot hospital. The parcel would also be home to a 70,000- to 80,000-square-foot medical office building the partnership would build, they said. Dan Moen, Triad's executive vice president, said building the new facility on McKenzie-Willamette's current campus on Mohawk Boulevard in Springfield was "doubtful." Triad might seek to convert that complex into an assisted living center or other similar venture, he said. Moen said Triad hopes to finalize the partnership agreement, acquire land, secure land-use permits and build the new hospital in about two years. Triad is betting that in the long run its big upfront cash investment in a new hospital will pay off in a steady stream of profits, Triad officials said. The Eugene-Springfield area has strong long-term growth prospects and is large enough to accommodate two financially successful hospitals, said Triad CEO Denny Shelton. The proposed partnership is subject to review by the Oregon attorney general's office. The agency's anti-trust and charitable activities divisions will look in to the deal, said Jan Margosian, spokeswoman for the agency. McKenzie-Willamette is a non-profit organization. Thursday's announcement caps a tumultuous period for McKenzie-Willamette and Lane County's health-care marketplace. Before Triad entered the picture, McKenzie-Willamette officials had said they would likely have to move from their midtown campus in order to stay in business because PeaceHealth is seeking city approval to build a $350 million regional medical facility nearby, in Springfield's Gateway area. PeaceHealth, if it gets the OK for that project, would move the bulk of its operations to Springfield from the Hilyard Street campus in Eugene. The nonprofit health system has long maintained that moving into Springfield would not hurt McKenzie-Willamette. Cash-strapped McKenzie-Willamette has spent months seeking a larger partner with the money and health-care expertise to put the community hospital on a more competitive footing with its much larger rival. McKenzie-Willamette CEO Roy Orr said his hospital's weak financial position -- it is losing money and its patient volumes are declining -- meant it was unable to independently borrow money on the bond market. The bond market considers McKenzie-Willamette too shaky to lend money to, Shelton said. Maureen Weathers, chairwoman of McKenzie-Willamette's board, which unanimously approved the preliminary agreement, said she was thrilled at the deal. "We do believe competition is the best way to serve the people of this area," she said. Shelton said his company has a strong track record of successful partnerships with small, nonprofit hospitals such as McKenzie-Willamette. He pledged to work with hospital management and employees and the community to develop a competitive and financially viable medical facility. "We are health care people first and business people second," Shelton said. "We have a very good understanding of how hospitals work." While officials were guarded about where the new hospital might end up, they indicated it is important for the facility to have its own geographic catchment area, distinct from PeaceHealth's. Triad has 48 hospitals and 14 ambulatory surgery centers across the country. Through a subsidiary, it manages 208 independent, nonprofit hospitals and health systems in 43 states. Specific terms of the agreement probably won't be ironed out for several months, but a rough outline looks something like this: McKenzie-Willamette and Triad would form a for-profit McKenzie Willamette Hospital entity into which each of them would contribute assets. Triad would provide up to $80 million; McKenzie-Willamette would provide its existing hospital, equipment and land, and its cash reserves of about $7 million. Triad would become the majority partner in the new entity, based on its larger equity contribution. Orr said the split would be about 80-20, favoring Triad. The actual split will depend on the results of Triad's evaluation of the hospital and appraisals of its assets, he said. Under the deal, cash from Triad would be used to pay off McKenzie-Willamette's long-term debt of about $9 million, Shelton said. The new partnership would pay cash for land acquisition, development and construction of the new hospital, so the new hospital would have no debt payments to make. Once the hospital was opened, the partnership would then divide any profits on an 80-20 basis, or whatever split the partners settle on. Triad's share would flow to the Triad parent corporation, while McKenzie-Willamette's portion would go to its non-profit arm, which is exempt from taxation. Triad would pay corporate income tax on its profits as well as property taxes for the land and buildings, Shelton said. The nonprofit arm could use its share of the profits for health care work in the community, he said. Moen said pay levels for workers under the new partnership will be as "good or better" then they are now, and current employees will all keep their jobs. Existing labor contracts, such as the one McKenzie-Willamette has with its nurses, will remain intact, Shelton said. Triad has agreed to provide at least the same level of charity and indigent care -- health services for those who can't pay -- as McKenzie-Willamette now delivers, Shelton said. Shelton said Triad intends to recruit more doctors to work at McKenzie-Willamette and possibly add services, such as a cardiac unit, to be more competitive with PeaceHealth's Sacred Heart Medical Center. The new hospital site will have room for future expansion, he said. He said the Lane County area needs two strong health care providers to serve consumers and cater to businesses that provide health insurance for their employees. "We will field whatever range of services needed to be competitive," Shelton said. PeaceHealth spokesman Brian Terrett agreed that having a strong McKenzie-Willamette Hospital is good for the community. "We've always been focused on community health, so from a community health perspective, having those 114 beds remain a part of the community health systems is a good thing," Terrett said. PeaceHealth is most concerned about the balance of indigent care between the two hospitals, Terrett added. "While we've delivered a majority of charity care in the past, we don't want to become the only provider of charity care in the future," Terrett said. Shelton said Triad is committed to providing free care for the poor. "We provide as much or more indigent care as any organization in any market we are in," Shelton said, adding that in 17 of the markets where it operates a hospital, Triad is the sole provider and handles all indigent care. "If you're in this business and you don't have the social responsibility to protect people, you shouldn't be in this business," Shelton said. Triad is operating against a national backdrop in which many hospitals have closed and many are in trouble because they don't have adequate revenues or capital, Shelton said. Of the 5,000 hospitals in the United States, two-thirds are in financial trouble and one-third don't have enough capital, he said. To some business people, that might be a warning to stay out of the field because there's no money to be made in it. But Shelton said it's a business opportunity. Triad has become a specialist in moving into smaller cities and partnering with cash-poor nonprofit hospitals. Small community hospitals in similar situations as McKenzie-Willamette usually don't generate enough revenue to upgrade old facilities in order to remain competitive, Shelton said. For example, McKenzie-Willamette put the brakes on a planned $50 million expansion in late 2001 because of poor cash flow. Triad's broad financial strategy involves raising large sums of money by selling stock, borrowing from banks, or issuing bonds. The company then invests that cash in local hospital projects, typically partnering with nonprofit community hospitals in need of big sums of capital to renovate and expand. Rather than lending the capital to the nonprofits, Triad often forms a partnership and pays in the capital as its equity contribution to the venture, as it is proposing to do with McKenzie-Willamette. Once the new hospital is built and begins generating revenue and profits, Triad takes a portion of the profits. Over time, the company hopes to reap an adequate profit to make up for its huge up-front investment of cash. Is that strategy working? Publicly traded Triad is a young company, formed only a little more than three years ago, so its financial track record is short. Already, the company has taken on massive debt to partner with hospitals. The company has $1.8 billion in debt, Shelton said Thursday. That debt load is expensive to carry. In the first nine months of 2002, the company spent $102 million making interest payments, according to its filings with the Securities & Exchange Commission. The company's profitability has been volatile. In 1999, the company reported a loss of $96 million on revenues of $1.3 billion. In 2000, the picture improved to a thin profit of $4.4 million on revenues of $1.2 billion. In 2001, revenues surged to $2.7 billion, but the profit dipped to a skimpy $2.8 million. In the first nine months of 2002, the company reported that revenues were $2.6 billion, and profits hit $106 million. Triad has deep pockets. As of Sept. 30, the company had $52 million in cash on hand, plus a credit line with a lender for $250 million, according to filings with the SEC. Also, the company has SEC approval to try to raise up to $800 million by issuing bonds, stock or other securities. But Triad isn't interested in keeping money-losing hospitals going for long. Shelton said Triad's only other facility in Oregon -- Willamette Valley Medical Center in McMinnville -- is working well. It's the sole hospital in McMinnville. But in Roseburg, Triad had little patience for money-losing Douglas Community Medical Center. Triad shut that hospital in February 2000. Shelton, a veteran health care executive, created Triad in 1999 by purchasing a collection of hospitals from giant HCA in 1999. Included in that $675 million package was Douglas Community, Shelton said. The hospital -- the smaller of two hospitals in Roseburg -- was losing millions of dollars a month, Shelton said, and Roseburg doctors seemed to have no interest in keeping it going. Roseburg's other hospital is Mercy Medical Center. "If the doctors don't want two hospitals here, then we can't be here," Shelton said. Bonnie Ford, a former board member at Douglas Community, said many in the Roseburg area dislike having only one hospital now. Douglas Community "should never have closed, but there were just too many things that came into play," Ford said. http://www.registerguard.com/news/2003/01/31/1a.mckenzietriad.0131.html ------------------------------------------------------------ 12.sn - Triad to become majority owner of McKenzie-Willamette Hospital ------------------------------------------------------------ By Jaime Sherman The Springfield News, 2/1/03 After months of rumors about building plans and potential financial partners, McKenzie-Willamette Hospital signed a preliminary, ownership agreement Thursday with Texas-based Triad Hospitals Inc. Triad, the third-largest, for-profit hospital chain in the United States, will become majority owner of McKenzie-Willamette and will build a new hospital in the Eugene-Springfield area. Triad officials from Plano, Texas, joined McKenzie-Willamette Chief Executive Officer Roy Orr and hospital board chairwoman Maureen Weathers for the official announcement at a news conference Thursday morning. McKenzie-Willamette began negotiations with Triad several weeks ago, and the 15-member McKenzie-Willamette Board of Directors unanimously approved the letter of intent with Triad at an annual meeting Tuesday night, Weathers said. "We couldn't be more pleased to have Triad as our new partner," she said. "We do believe competition is the best way to serve patients in this area, and it was one of the guiding principles all throughout this search." McKenzie-Willamette has sought a capital partner for its hospital since it began struggling financially a couple of years ago. In the meantime, hospital officials became vocal about the threat posed by PeaceHealth in Eugene. PeaceHealth ann-ounced plans in late 2001 to build a $350-million regional medical center and hospital in the Gateway area of north Springfield after plans to build in Eugene were unsuccessful. The Bellevue, Wash.-based, nonprofit hospital organization is waiting to build until receiving city approval on land use changes. The competition that two hospitals create will be good for the Eugene-Springfield area, said Denny Shelton, Triad's chairman and chief executive officer. "This is an area that will support two strong competitors in the marketplace," he said. "This is a hospital that I think can be a strong competitor. I think that's good for the community." Under the preliminary agreement, Triad and McKenzie-Willamette will share ownership of a new, for-profit hospital organization with Triad being the majority owner with a likely 80-20 split, said Dan Moen, Triad's executive vice president. Triad will enter the deal with $80 million in cash and with an agreement to pay off McKenzie-Willamette's existing debt. In turn, McKenzie-Willamette will provide the existing land and hospital equipment, Moen said. The new for-profit hospital will pay corporate and county property taxes. The minority owner, McKenzie-Willamette, will probably be able to maintain its nonprofit status, Moen said. Governance of the new hospital will be shared 50-50 by a six-member board of directors. Triad and McKenzie-Willamette will select three members each, Moen said. In addition, strategic decisions will be made by a 12-member board of trustees, consisting of six community members and six physicians. "The decision-making and health care will remain a local process here in your community," Moen said. Orr emphasized the new venture is a joint venture. "This is a partnership," he said. "We are not selling this hospital." The decision to select Triad as a partner was based on more than money, Orr said. "We wanted a company ideally that not only understood hospitals and had the capital resources but also understood this is an industry that has always been about people," he said. "It is about people and always will be about people." Triad, which was formed in 1999 as a spin-off of HCA, owns 48 hospitals and 14 ambulatory surgery centers in 16 states and manages 208 hospitals in 43 states. Plans for a new hospital call for replacing the existing facility with a 180,000- to 200,000-square-foot hospital with 114 private rooms. The hospital complex would also include a 70,000- to 80,000-square-foot medical office building and would have the potential for future growth, Moen said. The construction would be funded debt-free by Triad and could be completed as early as mid- to late-2004, Moen said. Triad officials said they would like to secure 35 acres within the Eugene-Springfield urban growth boundary on which to build a hospital. The location will be determined by hospital employees and staff and community members. Moen said it is "doubtful" the hospital will be built on the existing property at 14th and G streets. McKenzie-Willamette's Orr said a new hospital should be located where it "serves the communities best." He wouldn't speculate about sites. Springfield Mayor Sid Leiken said he'd like to see the hospital remain in Springfield. "We'll do our best (to keep them here), but it's very obvious all sites are on the table," he said. Triad and McKenzie-Willamette officials will look at several factors in choosing a hospital location, Triad's Shelton said. Those factors include access to the property and hospital services and the cost and size of the property. A decision on where to build a new McKenzie-Willamette Hospital will not be made until the partnership agreement in finalized in 60 to 90 days, Shelton said. The current hospital could be redesigned for extending or assisted living facilities. Springfield city staff would like to see the future use of the existing hospital complex established as soon as McKenzie-Willamette moves out, City Manager Mike Kelly said. "We hope when they leave, there's automatically a remodeling plan," he said. Service at a new hospital will remain the same and could include new services, including a cardiac unit and an MRI facility, Triad's Moen said. Triad hospitals accept various forms of payment from Medicare/Medicaid programs and HMOs to preferred provider organizations and private insurers. The 1,1000 current employees at McKenzie-Willamette won't lose their jobs under the agreement and may see even better salaries and benefits, Moen said. The management team will also remain in place. "We plan to keep the management team in place," Moen said. "They've done a great job." Brian Terrett, spokesman for PeaceHealth, said his organization sees McKenzie-Willamette's continued viability as a good thing. "From a community health perspective, which is a big part of our mission, we're happy the 114 beds of that hospital will remain in the community," he said. PeaceHealth's concern, he said, is that Sacred Heart Medical Center might become the only hospital in the area providing charity care. The Partnership The preliminary agreement: Triad Hospitals Inc. and McKen-zie-Willamette Hospital will partner to provide health care to Eugene-Springfield residents and to build a new hospital. Triad brings $80 million to the agreement. Governance of the new for-profit hospital will be split 50-50 by the two organizations, and strategic decisions will be made by a local board of trustees. McKenzie-Willamette Hospital Opened: May 1, 1955 Status: Nonprofit Location: 14th and G streets Number of beds: 114 Employees: 1,100 CEO: Roy Orr On the Web: www.mckweb. com. Triad Hospitals Inc. Formed: May 1999 Status: For-profit Headquarters: Plano, Texas Hospitals: 48 Ambulatory surgery centers: 14 Hospitals managed: 208 CEO: Denny Shelton On the Web: www.triadhospitals.com. http://www.springfieldnews.com/articles/2003/01/31/local/news1.txt ------------------------------------------------------------ 13.sn - Community joined together to fund 'Help it Grow' project ------------------------------------------------------------ By Jaime Sherman The Springfield News, 2/1/03 McKenzie-Willamette Hospital's history goes back several decades to the mid-1940s when private physicians practiced medicine from their homes and the city was without a hospital. Earlier attempts had been made to form and maintain a community hospital. Mrs. Peter Benson opened Springfield Private Hospital on the north side of Main Street between Mill and Second streets in the early 1900s, but the hospital become a boarding house in 1914. Springfield General Hospital, located at 846 F St., remained to serve Springfield residents but was converted into apartments in 1936. A line forms to get into the McKenzie-Willamette Hospital on May 1, 1955. Photo courtesy McKenzie-Willamette Hospital In 1949, a group of community members began meeting for "scrambled egg" breakfasts to discuss the idea of building a hospital in Springfield. They formed the McKenzie-Willamette Hospital Association and began fund-raising door-to-door. The campaign slogan for the 1950s was: "Help It Grow." "We worked like hell to build that hospital," Al Brandt said. "I didn't eat scrambled eggs for a long time after that." Brandt attended each meeting, helped with fund-raising drives and contributed his own money to help build McKenzie-Willamette Hospital. By July 1953, the association purchased land at 14th and G streets, and the victory was celebrated at a banquet that fall. More than 3,500 people had pledged $480,000, and the federal government had committed $155,000 to the project. The community-owned, secular hospital opened on May 1, 1955, with 35 beds. Six years later 19 beds were added, and the hospital's emergency room and expanding operating recovery rooms were constructed in 1964. Additional construction added offices and departments in 1968 and the intensive care unit in 1969. As the hospital grew, community members committed $532,000 in 1973 to build the four-story addition, giving the hospital a total of 104 beds, new operating rooms and additional departments. The 1980s brought even more growth and yet another community fund-raiser. Contributions totaled $1.1 million for construction of a new ancillary building, which opened in October 1983. The expansion added a helicopter landing pad on the roof. In 1991, McKenzie-Willamette boasted a full Level II trauma status, the highest trauma designation awarded to a non-teaching hospital. The hospital foundation hosted in 1993 the first Festival of Trees, a now-annual event that raises money each November for the hospital. In the late 1990s, construction was completed on the Jack V. Fuller Guest House, Adult Day and Health Care Center and the Women's Health and Birth Center. Plans for expansion of the nonprofit hospital continued in the late 1990s. The hospital planned a $50-$60 million, six-year expansion and update, but the plans were put on hold as the hospital began to suffer financially. McKenzie-Willamette began to record a drop in profit and failed to profit in 2001, hospital officials said. The financial struggles were attributed to PeaceHealth's repression of competition. In January 2002, McKenzie-Willamette filed a lawsuit in federal court, stating PeaceHealth was quelling competition by exclusively contracting with insurance provider Regence Blue Cross Blue Shield. A jury trial is scheduled for this October in Portland. The partnership, once it is formed, will not impact the lawsuit, said Roy Orr, McKenzie-Willamette's chief executive officer. In the meantime, McKenzie-Willamette continues to employ 1,100 employees. The hospital is home to 390 practicing physicians. The hospital recorded more than 35,000 emergency room visits in 2001 and projected nearly 38,000 visits for 2002. McKenzie-Willamette saw net income of $4.1 million in 2000 and $1.8 million in 2001, according to previously released figures from the hospital. McKenzie-Willamette has sought a capital partner for its hospital since it began struggling financially a couple of years ago. Triad Hospitals Inc. was a good match because of its access to financial capital and its mission to involve physicians in decision-making, said Maureen Weathers, chairwoman of McKenzie-Willamette's board of directors. While McKenzie-Willamette isn't losing money, the hospital is short on capital for future growth and development, said Denny Shelton, Triad's chairman and chief executive officer. Orr said the hospital will remain viable for years to come with Triad's help. "It's still my goal that the people who were involved in the construction and the fund-raising for the original hospital will be proud of it on its 50th anniversary and its 60th anniversary and its 70th and on and on," Orr said. "And I believe with the help of our capital partners we can do that." For more information on McKenzie-Willamette Hospital, go to www.mckweb.com. http://www.springfieldnews.com/articles/2003/01/31/local/news2.txt ------------------------------------------------------------ 14.rg - Editorial: Triad alters hospital mix: Partner strengthens McKenzie-Willamette ------------------------------------------------------------ Editorial Register-Guard, 1/31/03 Watching PeaceHealth and McKenzie-Willamette Hospital scramble for position in Eugene-Springfield is like trying to follow a chess match in which half the pieces are hidden from view. Just as an observer begins to get a feel for the game, an unexpected knight's move alters the balance on the board. The knight in this case is Triad Hospitals Inc. of Plano, Texas, which has entered a partnership agreement with McKenzie-Willamette. Some sort of partnership has long been possible, perhaps even inevitable, for Springfield's community-owned hospital. McKenzie-Willamette was the only independent hospital its size along Oregon's Interstate 5 corridor. Small to midsized hospitals have a hard time surviving on their own, lacking the patient volume to support highly specialized medical services and the capital for investments in buildings and equipment. McKenzie-Willamette announced Thursday that its partner would be Triad, the nation's third-largest hospital chain. Unlike McKenzie-Willamette and PeaceHealth, Triad is in business to make a profit. Its interest in McKenzie-Willamette is a sure sign that the company sees economic potential in the Eugene-Springfield market. Triad says it is willing to invest up to $80 million to modernize McKenzie-Willamette, but probably not at the hospital's current Mohawk Boulevard site in Springfield. It's likely that Triad sees its best opportunities in Eugene. The partnership ensures that patients in the Eugene-Springfield area will continue to have a choice of hospitals -- indeed, two new ones, if both McKenzie-Willamette and PeaceHealth carry through with their plans to build from scratch. Competition will be beneficial in many ways: Neither hospital will be able to dictate prices for services, both will have ever-present incentives to keep the quality of care high, and people who work in health care professions will have a choice of employers. Eugene-Springfield has that type of competition now. McKenzie-Willamette, by virtue of its smaller size, has been at a disadvantage, and in recent years has been fighting for its survival. Yet Triad believes it can pump $80 million into McKenzie-Willamette and earn a rate of return high enough to justify its investment. The company expects that McKenzie-Willamette's profitability can be improved by a new facility and by the economies of scale that come through linkage with a nationwide health care organization. It also undoubtedly hopes it can claim a larger share of the local market for hospital services, at PeaceHealth's expense. Triad and McKenzie-Willamette officials insist that PeaceHealth's plans to create a new medical complex in the Gateway area of Springfield did not affect their calculations. That's a credible claim -- McKenzie-Willamette began shopping for a partner before PeaceHealth announced that it would move its main hospital operations away from their current location near the center of Eugene. But PeaceHealth's plans will certainly affect Triad and McKenzie-Willamette as they scout locations for their new hospital. They will need 30 to 35 acres for the facility; as PeaceHealth discovered, parcels that size aren't easy to find. In the weeks to come people in the Eugene-Springfield area will learn more about Triad, and the details of its partnership with McKenzie-Willamette will become more clear. Triad officials say the company has partnership agreements in other states similar to the one with McKenzie-Willamette, but the Eugene-Springfield area has no experience with such arrangements or with for-profit hospital companies. Triad operates one hospital in Oregon, Willamette Valley Hospital in McMinnville, but that has always been a for-profit hospital. It had a second, Douglas Community Hospital in Roseburg, but shut it down. Until this week, it looked as though PeaceHealth might further weaken an already-struggling McKenzie-Willamette Hospital by moving to north Springfield. Now it looks as though McKenzie-Willamette will obtain the resources to respond to that competitive threat with a new hospital of its own. And this may not be the last time an unexpected move rearranges the chessboard. http://www.registerguard.com/news/2003/01/31/ed.edit.triad.0131.html ------------------------------------------------------------ 15.sn - Editorial: Hospital partnership will be interesting to watch ------------------------------------------------------------ Editorial The Springfield News, 2/1/03 There's a new player in town. Triad Hospitals Inc., a national health-care, for-profit corporation, joined with McKenzie-Willamette hospital officials Thursday to announce the two are forming a partnership. The company said it would pay off McKenzie-Willamette's debts and provide $80 million in cash to build a new hospital. Triad officials said they hope to move ahead as quickly as possible to finalize the partnership, identify a site and start construction. If all goes well, they said, a new hospital could be opened in two years. It's no secret that McKenzie-Willamette has been concerned about its future since PeaceHealth announced in September 2001 that it was building a new hospital in the Gateway area, the Springfield hospital fearing a new hospital's proximity would weaken it. McKenzie-Willamette had planned a $50-60 million expansion but those plans had been put on hold. In a separate matter, McKenzie-Willamette has sued PeaceHealth on anti-trust charges, and the Springfield facility has seen its profits drop in the last two years. But Triad is the third largest hospital company in the country, and it apparently has deep pockets. That news surely must be comforting to McKenzie-Willamette employees and supporters. It's very early in the process and much too soon to draw conclusions, but several questions arise. Where will a new hospital be located? Triad officials say it probably will not be located on the current McKenzie-Willamette site. Instead, that facility may become an assisted living center. The chances are good that a new hospital would be located in Eugene. City officials there were distressed at the news that PeaceHealth was moving to Springfield. Now, they would surely be more than willing to work with a hospital developer. Second, what role will McKenzie-Willamette, a nonprofit, play as a partner with Triad? Although Triad officials say the governance will be divided equally between McKenzie-Willamette and Triad, that's difficult to believe if Triad sees an 80-20 split between the two (80 percent Triad, 20 percent McKenzie-Willamette). Experience shows that whoever pays the bills sets the rules. Third, what would happen if the PeaceHealth hospital hits a snag and PeaceHealth decides to move elsewhere? The process has been in the works for some 18 months now and only recently did the Springfield Planning Commission issue its first decision. Several steps remain before the new facility is built and if PeaceHealth decided to leave Springfield and Triad-McKenzie-Willamette built elsewhere, Springfield could be back where it was in the late 1940s -- without a hospital of its own. Maureen Weathers, McKenzie-Willamette's board chairman, is right when she says competition is important. Certainly, everyone hopes that McKenzie-Willamette not only survives but thrives. The PeaceHealth saga has been dominating the headlines for some time now. It's interesting to see McKenzie-Willamette become more of a player. Meanwhile, we will be watching with great interest because how this all plays out will have a great impact upon the city of Springfield. http://www.springfieldnews.com/articles/2003/01/31/opinion/news1.txt ==================== New Hospital Site =================== ------------------------------------------------------------ 16.rg - Site is unknown, but Eugene is most likely ------------------------------------------------------------ By Tim Christie The Register-Guard, 1/31/03, Page 1A Eugene may get a new hospital after all: The city is probably the leading contender for a new McKenzie-Willamette Hospital -- built from scratch with $80 million from a Texas-based partner. Officials from Springfield's McKenzie-Willamette and Triad Hospitals of Plano, Texas, were vague Thursday about where their new hospital will go -- someplace in the Eugene-Springfield area was all they would say -- but Eugene appears to make the most geographic and business sense. The city of 140,000 would be left with no hospital if PeaceHealth gets its way and builds its new medical center in north Springfield, and Eugene officials are anxious to ensure city residents have ready access to emergency medical care. "I think it's good news," Mayor Jim Torrey said. "I've always felt we should have a competitive situation for medical care in this community." [MAP: Hospital Sites] City Councilor David Kelly said he would have preferred McKenzie-Willamette to remain independent, "but that clearly wasn't in the cards." "Given that, it's great that they found a partner who seems to be willing to invest significant funds for the health care of the community," he said. Eugene has struggled to come to terms with the prospect of losing its only hospital after PeaceHealth, the corporate parent of Sacred Heart Medical Center, decided in 2001 to build a replacement hospital in north Springfield's Gateway district after contentious site wrangling with Eugene officials. The decision stunned Eugene city leaders and left residents of south and west Eugene worried about having both of the metro area's hospitals east of Interstate 5 and north of the Willamette River. That makes for a long drive for many Eugene residents. Plus, city officials worry that some residents could be stuck without care if a flood or earthquake blocked access across the river and the interstate. Triad and McKenzie-Willamette officials say they've had only cursory discussions about potential hospital sites. Their starting point, however, is a list of 10 potential sites in Eugene that city planners developed last fall, said Roy Orr, McKenzie-Willamette's chief executive. Some of the sites may be too far from the city center or too small to meet Triad's needs. The company says it wants a site of at least 35 acres for the hospital and an adjacent medical office building. The Eugene sites vary widely in size and location. Some are far from the Eugene's core, including 25 acres at 29th Avenue at Willamette Street in south Eugene; more than 60 acres at Willagillespie Road and Delta Highway in north Eugene; and 114 acres at Greenhill Technology Park on 11th Avenue at the western-most edge of Eugene. Others, such as the 9 acres around the old Eugene Clinic at 12th and Olive in downtown owned by PeaceHealth, are too small. Still others would seem to have the right size and location, such as the 56-acre Lane County Fairgrounds; 47 acres at West Broadway and Garfield Street; and a 110-acre site on Highway 99. City staff also prepared a list of incentives the City Council might offer, ranging from waiving permit fees and systems development charges to acquiring the land and donating it to the hospital. The new hospital partners said they'd like any help Eugene might offer. Denny Shelton, Triad's CEO, said Mesquite, Nev., gave Triad 40 acres for a new hospital there. But Eugene officials aren't sure if they would offer Triad financial incentives. "It's way too early," Kelly said. Torrey said the city should steer clear of offering incentives. "We are a quality city," he said. "We are a place where people should want to be if they're in the hospital business. I don't think we have to throw money to get this." But Torrey and Kelly agreed that the council and city staff should smooth the permitting process for Triad and McKenzie-Willamette. "We ought to enable this to happen," Torrey said. "We should not create zoning and permitting hurdles." Kelly said the city can provide Triad and McKenzie-Willamette what any developer wants: "Some predictability, some assistance, some help navigating through the bureaucratic maze, and it's clear the council is supportive of that kind of help." Dan Moen, executive vice president of Triad, said the new hospital would be 180,000 to 200,000 square feet, compared with the current 150,000 square-foot hospital in Springfield. It would initially have the same number of beds as the existing hospital. That would save Triad from having to obtain state approval for an expansion, he said. But the hospital's design will allow for later expansion, he said. "We foresee a 200-bed hospital one of these days," Moen said. http://www.registerguard.com/news/2003/01/31/1a.location.0131.html ------------------------------------------------------------ 17.rg - Fairgrounds no shoo-in for hospital ------------------------------------------------------------ By Randi Bjornstad The Register-Guard, 1/31/03, Page 9A From an angry denunciation to a wait-and-see attitude, Lane County commissioners reacted Thursday to the suggestion that the new McKenzie-Willamette Hospital might be built on the county fairgrounds site in west Eugene. Commissioner Bill Dwyer's response was, "Thanks: Our fairgrounds are not for sale and (are) not an option for your siting. Look elsewhere!" Commissioner Anna Morrison was more temperate. "Thank you for the new information ... I look forward to working with you and your board on this new endeavor." The two commissioners were responding to an e-mail from a McKenzie-Willamette representative telling them of a Thursday news conference at which officials announced the partnership of the Springfield hospital with a Texas-based hospital chain. The 56-acre Lane County Fairgrounds property on West 13th Avenue has been on a short list of potential hospital sites identified by the city of Eugene since PeaceHealth announced it would move Sacred Heart Medical Center out of central Eugene to the Gateway area of Springfield. In addition, there have been persistent rumors in real estate and political circles that land dealer John Musumeci of Arlie & Co. hopes to persuade commissioners to move the fairgrounds onto property owned by Arlie south of Lane Community College. In November, after voters trounced a county-sponsored $10 million bond measure to build a new planetarium at the fairgrounds, Musumeci offered to donate 10 acres of land, plus financial support, to keep the planetarium project alive. However, planetarium sponsors never took him up on the offer. Dwyer said all the speculation about putting a hospital at the fairgrounds and moving the fairgrounds onto Arlie property made him irate. Peter Sorenson, chairman of the board of commissioners, said siting a hospital "should be a matter of great public debate and scrutiny." "This is not a little land-use decision that should be decided solely by Lane County, Springfield or Eugene," Sorenson said. "We ought to be going way outside the box ... and figure out the best solution for locating hospitals in general in this area. I wouldn't want to start out by saying 'yes' or 'no' to any particular site." But Sorensen added that he's "not leaning toward changing the Lane County Fairgrounds. I'm open to the possibility, but I'm not leaning that way." Moving the fairgrounds would have to be in the economic interest of county taxpayers, Sorenson added. Fair Manager Warren Wong said a move could be a tough. "We're doing pretty well right now, but we still have $7 million in debt outstanding," Wong said. "If we had to replace the fairgrounds somewhere else, where would the money come from to do that?" http://www.registerguard.com/news/2003/01/31/9a.musumeci.0131.html ------------------------------------------------------------ 18.rg - Land swap idea draws tepid response ------------------------------------------------------------ By Randi Bjornstad The Register-Guard, 2/1/03, Page 5B A proposal made public Friday by land dealer John Musumeci to put the proposed new hospital at the Lane County Fairgrounds and move the fairgrounds to 100 acres of forestland Musumeci owns south of Lane Community College appears headed for resistance when county commissioners take up the matter on Wednesday. Musumeci said his firm, Arlie & Co., would donate 100 acres west of Goshen and just north of Scharen Road to the county to relocate the fairgrounds. In exchange, Musumeci said, the county would give him the 56-acre fairgrounds property at 796 West 13th Ave. in Eugene. [PHOTO: John Musumeci talks about his proposed land swap Friday.] [MAP: Arlie idea map] Arlie & Co. then would "master-plan the redevelopment of the fairgrounds," Musumeci said. Arlie would donate to the city 35 acres that are needed for the new hospital and keep the balance of acreage for itself to build a "village-size shopping area" and a "residential apartment component," he said. The whole transaction would hinge on crafting a development agreement with the city of Eugene that would include the rezoning of the fairgrounds to allow a hospital and related medical services. The site currently carries a "public lands" designation. "There is a crisis going on in health care (in the Eugene-Springfield area), and the city of Eugene doesn't have the tools it needs right now to be able to attract a hospital," Musumeci said. "This isn't an issue of real estate, this is an issue of health care. We need to put Eugene into the game, and and we're looking for ways we can help." Musumeci's proposal comes on the heels of this week's announcement that McKenzie-Willamette Hospital in Springfield will partner with Texas-based Triad Hospitals Inc. and build a new hospital somewhere in the Eugene-Springfield area. A site hasn't been picked yet. Musumeci played a big role in the proposed move of Sacred Heart Medical Center from Hilyard Street in Eugene to Springfield's Gateway area. Arlie sold PeaceHealth -- Sacred Heart's owner -- the Gateway land for the proposed $350 million complex. Peter Sorenson, chairman of the Lane County Board of Commissioners, said Friday that after reviewing Musumeci's proposal, "As far as I'm concerned, it's dead on arrival." "There are several reasons for that," Sorenson said, "and the first one is, the fairgrounds is not for sale." The county commissioners have the right to sell county-owned property for any legitimate public purpose, he said, but all such transactions must confer a net benefit to the citizens of the county. "In this case, in my opinion, exchanging a piece of unincorporated land outside the urban growth boundary for an urban convention center that hosts 600 events per year and depends for its success on its proximity to hotels and restaurants would not meet that test," Sorenson said. "The aerial photo Musumeci has given us of this site doesn't show one single hotel anywhere on the map -- it's miles away from the economic engine that drives the success of the fairgrounds. It would be the death knell of that facility." Although many people equate the word "fairgrounds" with the animals, cotton candy and stomach-churning rides that make up the facility's most important annual event, Lane County's 56-acre fairgrounds complex "has 599 more events than just that every year," Sorenson said. "We have worked tirelessly to build up this operation so that we don't put any taxpayer dollars into this facility. To alter the basics of what we've accomplished would require an incredible amount of study," he said. The county assesses the fairgrounds at just under $21 million, although that figure reflects its use for public purposes and doesn't reflect either its value on the open market or the county's nearly $30 million in improvements during the past several years, facilities manager David Suchart said. "If we were really going to look at selling the fairgrounds, we'd have to have an independent appraisal based on the highest and best use of the property, and that would no doubt be a lot different from the assessment," Suchart said. In contrast, the 100-acre parcel that Musumeci has offered to trade for the fairgrounds cost his firm about $270,000. It constitutes about 10 percent of a 1,100-acre plot of heavily logged forestland that Arlie bought a year ago for $2.98 million. At Friday's news conference to announce his idea, Musumeci downplayed the hurdles his proposal would have to overcome in the way of state and local land use laws. These obstacles include the fact that the 100 acres -- as well as the rest of the 1,100 acres Arlie owns there -- lies outside the urban growth boundary. "This doesn't have anything to do with the urban growth boundary," because if the county took title to the land, "it has the authority over its own land" and can use it as it sees fit, Musumeci said. "So we see no problems with access or using it." The land is zoned for forest use, and it's unclear whether intensive development such as a fairgrounds would be allowed there. Musumeci acknowledged his idea may go nowhere. "There may very well be so many problems (with this) that it just can't be done," he said. "But we're willing to put in the effort." County Commissioner Anna Morrison said she's willing to keep an open mind toward the idea. Arlie has asked the county to designate a group of people to meet with the company to talk it over. "We need to sit down and discuss it -- it would be premature to close the door to this idea before we open it far enough to see what's behind it," Morrison said. Her colleague on the county board, Tom Lininger, agreed. But he added: "In light of what I know now, I'm pretty pessimistic about this proposal." Sorenson said that choosing a site for a new hospital that serves the entire Eugene-Springfield region should not be left up to any single local government. "The location of a regional medical center is a significant land-use decision, and it should be (determined) as the result of deliberations that involve all three local governments -- Eugene, Springfield and Lane County," he said. "I don't think we should be considering a proposal like this that makes that decision for us." http://www.registerguard.com/news/2003/02/01/5b.bz.musumeci.0201.html ===================== Arlie Proposal ===================== ------------------------------------------------------------ 19.ac - Potential Hospital Sites ------------------------------------------------------------ Web Page Arlie & Company The City of Eugene determined in recent months that it was vital to retain a hospital, preferrably near the downtown core, to provide needed medical care for the community. A key challenge the community faces, is providing an ideal development site of 20 or more acres for potential recruiting efforts. In recent weeks Peacehealth confirmed its intent to relocate to Riverbend. Recognizing the need for a hospital to provide vital services to the people of Eugene and in keeping with our committment to support and give back to the community, we felt compelled to commit all of our resources to assisting with this community need. After weeks of analysis and planning, we put forth what we felt was a win-win proposal. Click here to read the proposal. http://www.arlie.com/community/ ------------------------------------------------------------ 20.ac - Hospital Siting Proposal ------------------------------------------------------------ Web Page Arlie & Company One of the biggest challenges facing any hospital recruiting efforts for the City of Eugene, is providing adequate acreage near the downtown core. Arlie took this challenge as an opportunity to commit our resources and staff to provide a solution, and in the process, came up with a win-win situation, solving two community problems at once. However, this is definitely a community wide issue and one which should involve the collective thoughts and ideas of everyone. We invite you to review our proposal and join us as we survey your thoughts and we especially encourage you to join our Feedback Forum, where the community as a whole is invited to share and converse. We feel this is an ideal solution for the community, but most importantly want to begin a dialogue in which all the community has a voice. http://www.arlie.com/community/hospital_site.htm Arlie Feedback Forum: http://www.arlie.com/community/Forum/index.php ------------------------------------------------------------ 21.ac - Arlie Shares Idea to Secure Hospital Site and Relocate Lane County Fairgrounds ------------------------------------------------------------ Idea could create a win-win situation Press Release Arlie & Company, 1/31/02 Eugene, Ore., Jan. 31, 2003 -- John Musumeci, vice president of operations for Arlie & Company, today talked about an idea that would facilitate the relocation of the Lane County Fairgrounds to a site his company owns west of Goshen, so the fairgrounds' site could be available for a hospital. "When I first heard that the City of Eugene was interested in identifying a site for a hospital, I was intrigued," Musumeci said. "I followed subsequent news reports. When it was announced that the fairgrounds was a potential site, lights went off in my head! Everyone knows that there are conflicts between the fairgrounds activities and the surrounding neighborhood. It would benefit the community for the fairgrounds to relocate to a more rural setting where there would be no conflicts. And the fairgrounds site is large and near the urban core, making it a perfect site for a hospital." Musumeci indicated that Arlie owns several rural parcels, so he asked his team to evaluate them to determine which one would be the best site for a fairgrounds. They focused on three main criteria: * A flat parcel, over 100 acres * Good transportation access * Beautiful, rural setting "Almost immediately, the south end of our College Park property emerged as a likely location for a fairgrounds, and it really does fit our criteria to a 'T'," Musumeci said. "Early on, someone suggested that we should consider a property exchange -- our rural property for the fairgrounds. That seems like a simple concept, but exchanges are rarely of equal value and there are always numerous issues to address and resolve. We agreed that would be the case in this instance. Since we believed that we could create a win-win situation by exchanging our Goshen-area property for the fairgrounds site, we proceeded with our evaluation process." On January 29, 2003, Arlie sent a letter to Bill Van Vactor, administrator of Lane County, describing our idea. The purpose of the letter was to open a dialog with the county about the feasibility of considering this type of exchange. Musumeci indicated he expects that finalizing a property exchange will involve talking with elected officials, as well as soliciting public input. He also said that Arlie & Company is willing to donate land for a hospital site to help attract a hospital to the community. "Our role is not to recruit a hospital, only to secure and prepare a site that facilitates that recruitment, which we assume will be done by the city of Eugene," Musumeci continued. "We look forward to further discussions about whether or not our idea will meet the needs of the community. Our company strives to identify community needs and help meet them. In this instance, we think our idea can address both the need for a specific site for a hospital, as well as relocate the fairgrounds." "We will work with the county, the Fair Board and other interested parties to make this exchange a win-win for everyone, and if it isn't then the exchange shouldn't happen," Musumeci concluded. http://www.arlie.com/community/Arlie-hospfgrelease1-31-03.pdf ------------------------------------------------------------ 22.ac - Fairgrounds Site Proposal ------------------------------------------------------------ By Suzanne K. Arlie, President Arlie & Company Memo, 1/29/03 January 29, 2003 Bill Van Vactor, Administrator Lane County 125 E. 8th Avenue Eugene, OR 97401 Subject: Fairgrounds Site Proposal Dear Mr. Van Vactor: This letter presents a proposal to the Board of Commissioners offering an exciting possibility for Lane County. The City of Eugene supports the location of a hospital in Eugene and has identified several possible sites for a hospita1 within its boundaries. All of the sites are either presently in use or have other restrictions that make locating a hospital there difficult, expensive, or both. One of those sites is the Lane County Fairgrounds. Three conditions make the continuing viability of the current Fairgrounds as a regional event center somewhat questionable: conflicts with neighbors, its close proximity to the Amazon Channel, and its lack of adequate parking. To attract a hospita, the community must identify a specific site. That site can be the Fairgrounds. We believe that Lane County, in partnership with Arlie & Company, can provide a site for a hospital and resolve a myriad of problems associated with the current Fairgrounds. Arlie & Company has vacant land just west of I-5 in Goshen. Its size, location, topography, and access make it an excellent location for a fairgrounds facility. We propose to donate property to the County for use as a new Fairgrounds, in exchange for ownership of the current County Fairgrounds, which would become a site for a new hospital. The prinncipal points of our proposal are tbese: * Arlie would donate approxlmately 100 acres to Lane County for the purpose of developing a new site for the annual County Fair and other events. The site, on relatively flat land in a beautiful rural setting just west of Goshen, could be made easily accessible by way of I-5 and Hwy 58 at Goshen. (See Exhibits A and B) * Lane County, in exchange and for other considerations, would deed Arlie & Company the current Fairgrounds site, approximately 53 acres in size, south of 13th Avenue. * If desired by the County, Arlie would lease back a portion of the current Fairgrounds in order to maintain the County Faugrounds administrative and exhibitors' hall functions, including padring, until replacement facilities are developed. * Arlie would master-plan the development of the Fairgrounds. * Arlie's master plan would provide an adequate nDumber of actes to site a hospital. * The masterplan could include a village-size shopping area designed to provide goods and services such as coffee shops, flower shops, restaurants, etc. to the new hospital and surrounding residential areas. It could feature a linear park and pedestrian pathway along a reconfigured Amazon Channel as well as a residential apartment component. * Any tentative transaction with the County would be contingent upon the execution of a development agreement with the City of Eugene, a condition of which would be a hospital/medical services zoning district. As a Eugene-based land development and real estate investment company, Arlie & Company has experience in locally siting non-profit and governmental entities. Recently, we collaborated with tho City of Springfield, Willamalane Park and Recreation District, Broadbase, and KidSports to create a major youth sports complex in midtown Springfield. The enclosed article details the specifics of the project. Arlie & Company has handled numerous, complex real estate transactions, including a major hospital siting, urban village master planning, and various mixed-use developments. The staff of Arlie & Company is highly qualified in land use planning and available to assist in all site issues. To procecd with this private-public partnership, we ask that the County name a three or four person team to work with Arlie to explore the feasibility of this proposal. Please call me if you would like to tour our Goshen property or if you would like our development team to make a formal presentation. Arlie & Company believes this plan presents a win-win situation for the County, the City of Eugene, the current Fairgrounds' neighbors, patrons of the Lane County Fair, and the community as a whole. We look forward to partnering with Lane County. Sincerely, Suzanne K. Arlie President http://www.arlie.com/community/hosfgletter.pdf ====================== Lyle Hatfield ===================== ------------------------------------------------------------ 23.sn - Springfield Chamber winners work for the community ------------------------------------------------------------ By Jaime Shermand and Kim Sullivan The Springfield News, 1/29/03 Lyle Hatfield, First Citizen Lyle Hatfield He never endeavored to serve in a political office, and he never dreamed his life would become engrossed in the ins and outs of public service. But City Councilor Lyle Hatfield's trek from college student to banker helped him realize his passion for political decision-making and problem-solving. "I discovered I really enjoyed it," Hatfield said. Hatfield's service to the city of Springfield began in 1995 when he joined the Planning Commission and it continued to grow as he was appointed to the City Council. On Friday night, Hatfield's service earned him the honor of Springfield First Citizen for 2002. City Councilor Tammy Fitch, who presented the award, described Hatfield as "a true leader and public servant" with a "great sense of humor, insight, leadership and commitment." Hatfield's path toward public service began while he was in school at Whitworth College in Spokane, Wash. He worked for a couple of banks and was introduced to public service as he was mentored by the director of a hospital organization. The political side of public service didn't come until he moved to Springfield. Hatfield's civic service has included time on the Springfield Chamber of Commerce Legislative and Future committees, the Public Safety Coordinating Council, the Metropolitan Policy Committee, the Lane Council of Governments and the League of Oregon Cities. He works for Oregon Pacific Banking Co., is a rotary member and attends Thurston Christian Church. He and his wife, Alice, have three children. The award came as a surprise, Hatfield said Monday. "I'm still a little bit speechless over it," he said. "It's just such an honor. Just to be numbered among those men and women is just a tremendous honor and something to live up to." Marylyn Phillips, Businessperson of the Year And the Businessperson of the Year Award goes to -- a local insurance agent named after Marilyn Monroe. It's Marylyn Phillips, whose mother named her "Marylyn Jean" after the famous film star. "I think, though," Phillips said, "she didn't really know how to spell it." Originally from Portland, Phillips worked in banking in San Diego, Calif., before being lured back to the Northwest by State Farm in the mid-1970s. Phillips became a successful agent, earning top salesperson of the region out of 39 State Farm agencies for the last two years in a row. While providing around-the-clock service to her clients for nearly 28 years, Phillips is also committed to the community and serves as chairwoman of the Springfield Planning Commission. She is a member of the Pioneer Parkway Extension Committee for Lane Transit District and volunteers for dozens of organizations and events. Businessman Rod Hatter said Phillips has given "the same efforts to her customers and associates that have been given to the community at large." Phillips and her husband and business partner, Tom Frost, have five children and 12 grandchildren to keep them busy. Her schedule leaves little time for hobbies such as oil painting, golf and fishing. But Phillips said things will change March 1 when she retires from State Farm and the stress of running her own business. "Although I don't like to use the 'r' word," Phillips said. "I tell people, it's not like actually retiring, I'm just going to do something different." She said she's assured she'll find meaningful ways to spend her time. "I've always been a quiet person," she said, "but I've always known what I wanted." For now, she's looking forward to spending a few weeks in Florida and the Bahamas with her husband. When she gets back, "Who knows?" she said. "None of us really know what time we have left. I want to enjoy those years." John McCulley, Distinguished Citizen Every Monday morning for more than a decade, former Mayor John McCulley has gathered with a dozen other men for the Senior Forum at the Chamber of Commerce office. They "shoot the breeze," discussing current events and political issues. McCulley presides over the meetings as chairman, but on Monday, his colleagues joked he should now be called "president" because he was named Distinguished Citizen on Friday. "It was a surprise," McCulley said Monday of the award. "It knocked me over." The award was shared by McCulley, who was mayor from 1967 to 1971, and the late Bob Straub, a former governor. A distinguished citizen is one who has shown a "life-long or extended commitment to the community." McCulley served as mayor during a time of personal challenge. His wife died in 1963 a day after their youngest of five children was born, leaving him to raise three daughters and two sons. McCulley served on the Willamalane Park and Recreation District Board of Directors from 1956 to 1959 and was a city councilor from 1964 until he was appointed mayor in 1967. Time commitments of his job as a real estate appraiser for Blinkhorn Associates of Eugene caused McCulley to resign his tenure as mayor in 1971. McCulley was active in real estate circles until July. During his years of service to the city, he served with the Lane Council of Governments and the Lane County Boundary Commission. Today, he serves on the Citizen Advisory Board to Willamalane. He and his wife, Florence, live on I Street in a home he purchased in 1958. While McCulley enjoyed his friends' joke about being called "president," he said the award could easily belong to someone else. "You can look around and see a lot of people who have done things for the community," he said. Bob Straub, Distinguished Citizen Former Gov. Bob Straub posthumously shared the Distinguished Citizen award with former Mayor John McCulley Friday night. Straub's wife, Pat, of Springfield, accepted the award for her late husband. He died on Nov. 27, 2002, of Alzheimer's disease at the age of 82. "I think it was very wonderful to get that recognition for Bob," she said Monday. The award was a way to recognize "a native son who has passed away," said Dan Egan, executive director of the Spring-field Chamber of Commerce. The Straub family lived in the Thurston area from 1947 to 1959. Straub was elected Lane County commissioner in 1954 and state senator from Eugene in 1958. He was elected state treasurer in 1964 and re-elected four years later. From 1966 to 1978, he ran for governor four times, winning in 1974. He served as governor from 1975 to 1979. Throughout the years, Straub was an environmental advocate and instrumental in protecting Oregon beaches. Other winners: The chamber presented Cornerstone Awards to the Springfield School District, Mary Ann Rhodes of the Springfield Utility Board, Paul Plath, and Don Essig and Bud Johnson of Acme Collision Service. Marylyn Phillips, a State Farm insurance agent, received the Greeter of the Year award. http://www.springfieldnews.com/articles/2003/01/29/living/news1.txt ------------------------------------------------------------ 24.rg - Springfield councilor kept commitment to the end ------------------------------------------------------------ By Matt Cooper The Register-Guard, 2/1/03, Page 1A [PULL QUOTE: "The one thing he never did was complain. This was a deck of cards dealt him and he accepted it, and he knew he was going to beat it, up until this morning." -- Sid Leiken, Springfield mayor] Springfield -- Anyone with any sense knows to steer clear of government business, what with all the reports and debates and mind-numbing meetings. But Springfield City Councilor Lyle Hatfield, who died Friday morning at age 45 at a Portland hospital, thrived on it. Public service gave Hatfield life. And he was a man who -- his body racked with cancer -- needed life wherever he could find it. "I asked him last year, 'Do you think you want to slow down?' " Mayor Sid Leiken said Friday. "He'd say, 'No way.' This is what he enjoyed doing so much. It kept his mind focused." [PHOTO: Lyle Hatfield undergoes cancer treatment in July 2001. The Springfield city councilor died Friday.] Hatfield, in fact, was attending meetings as late as last week. His death shocked some precisely because of his stubborn commitment to public service, despite his deteriorating physical condition. You got used to seeing Hatfield seated up there next to his fellow councilors, his face swollen by his condition but his mind and his tongue as sharp as ever. When he was laid up in a Portland hospital bed in the summer of 2001, he joined in the council meetings anyway, his voice transmitted by speaker phone during evening meetings. But Leiken, among those closest to Hatfield in public life, also caught a glimpse of the health burden that weighed heavily on him. It was around Christmas of 2001, Leiken said, when Hatfield's cancer resurfaced just months after he underwent crippling chemotherapy. Hatfield, a relentlessly optimistic type given to using sports metaphors of victory and defeat, admitted his disappointment in a rare show of emotion, Leiken said. He was concerned about his wife, Alice, and their three children, but the disease that was killing him didn't warrant so much as a gripe, the mayor said. "The one thing he never did was complain," Leiken said firmly. "This was a deck of cards dealt him and he accepted it, and he knew he was going to beat it, up until this morning ... " With that, Leiken's voice trailed off and he just shook his head. Hatfield was starting to shine, too. Last month, he was named First Citizen by the Springfield Chamber of Commerce and Outstanding Elected Official for 2002 by the Lane Council of Governments. "Lyle Hatfield was one of the truly outstanding public officials," Eugene Mayor Jim Torrey said Friday. "He's going to be missed because of the intensity of the work he was able to do -- in many instances, while he was quite ill." Hatfield was diagnosed with Hodgkin's disease in March 1999, just two months after his appointment to the City Council. He had no intention of letting the illness drag him down, he said. "He was the glue that held the council together," said Sen. Bill Morrisette, a former Springfield mayor. Springfield Councilor Anne Ballew said Hatfield was adept at bringing people on different sides to a consensus. "He was very good at understanding the issues, doing his homework, having an opinion, but he also listened to others and he was very good at synthesizing the opinions that were on the table," Ballew said. That ability to build consensus was never more apparent than during his work on TransPlan, a gigantic undertaking by local governments to map out the Eugene-Springfield area's transportation system for the next 20 years. The TransPlan reports -- nearly a decade in the making -- were thicker than a telephone book and not half as interesting to some, Leiken said, but Hatfield was able to reconcile his city's pro-growth bent with the kaleidoscope of views on the other side of Interstate 5. Eugene City Councilor Scott Meisner, his counterpart on TransPlan, said Hatfield had been so positive and so productive for so long that his cancer was all but forgotten -- until Friday. "I really was stunned," Meisner said. "He has been a successful survivor for so long that I suppose I wasn't focused on the illness." Hatfield's wife and children are relying on the family's "unbreakable faith" right now, Leiken said, which was also at the root of Hatfield's acceptance of his condition. "One of the things he'd say to me was, 'There's reasons for it,'" Leiken said. "'Sometimes it helps us grow our character as people.'" http://www.registerguard.com/news/2003/02/01/1a.lylehatfield.0201.html ------------------------------------------------------------ 25.sn - Editorial: Hatfield will be missed ------------------------------------------------------------ Editorial The Springfield News, 2/1/03 The death of City Councilor Lyle Hatfield Friday means the city has lost one of its most dedicated volunteers who worked to make Springfield a better place in which to live. Just last Friday he was named 2002's First Citizen by the Chamber of Commerce, and he certainly deserved the honor. The list of his involvements -- which was included in a profile piece about him in Wednesday's paper and in a story on Page 1 today -- is lengthy. He had been fighting cancer for four years. Nevertheless, he was thoroughly committed to his civic duties. If he couldn't attend a council meeting, he would be present by speaker phone. In a joint statement, Mayor Sid Leiken and members of the City Council said Lyle's "passion for public service, his courage in the face of adversity and his dedication to good government ideals was an inspiration to all who knew him." Finding someone to take his place on the council -- and in the community -- won't be easy. http://www.springfieldnews.com/articles/2003/01/31/opinion/news2.txt =========================== Key ========================== "Health Options Digest" is best read with an email program that recognizes links to web pages. It includes leads from and links to stories and opinions from the following publications: rg = The Register-Guard sn = Springfield News ew = Eugene Weekly cn = Comic News ode = Oregon Daily Emerald cce = City Club of Eugene Newsletter or = Oregonian ac = Arlie & Company For some stories, two links are given. Use the first link if the story is still current; use the second if another issue has since been published. ========================= Credits ======================== "Health Options Digest" is published once every week or so by the Coalition for Health Options In Central Eugene-Springfield (CHOICES) as a service to the community. It is intended as an unbiased digest of news and opinion related to proposed changes in health care options for the community. The purpose of "Health Options Digest" is to inform, not editorialize. Please forward your copy of "Health Options Digest" to a friend. If you know of someone who should be on the CHOICES email list, or for questions about your subscription, send email to rzako@efn.org. ======================== More Info ======================= Please visit our web site for info about how you can contact us, the local papers, elected officials, PeaceHealth and McKenzie-Willamette: http://www.efn.org/~choices