San Pablo: Doctors Medical Center board approves tax measure, parking lot lease deal

By Robert Rogers
Contra Costa Times

SAN PABLO -- Doctors Medical Center's governing board on Wednesday authorized a parcel tax mail-in ballot election in May and agreed to lease a portion of its parking lot to a casino for $5 million, two moves that could avert closure this year and make the long-struggling hospital more attractive to potential partners.

The West Contra Costa Healthcare District board of directors, which owns and operates the hospital, voted unanimously to ask district voters to approve a parcel tax of 14 cents a square foot, which would raise about $20 million per year. The parcel tax, which would be the third approved by district voters since 2004, requires two-thirds voter approval.

The board also agreed to a 20-year lease of a portion of its parking lot outside the cancer center to the Lytton Casino, its neighbor to the south, for $5 million in cash. The funding allows the hospital to keep its doors open long enough to see whether the tax passes.

"$5 million gives us the liquidity necessary to get us to the parcel tax," interim CEO Dawn Gideon said.

The vote authorizes a special mail-in ballot election due May 6, DMC spokeswoman Remy Goldsmith said.

Reeling from yawning gaps between costs and revenues, in need of partnerships and unable to tap state or county funds, the board declared a fiscal emergency for the hospital in November.

Gideon has said the hospital has been hemorrhaging $1.5 million per month for the past two years and faces a $19 million deficit in the current year's budget, a crisis that requires deep cuts, new funding streams and partnerships with other hospitals to avert closure.

Even if voters approve a new parcel tax, the hospital also needed millions in bridge funding to survive into the summer. The lease deal with the casino staves off the possibility of immediate closure.

Hospital leaders are in talks with other area hospitals, including Kaiser Permanente, for additional funding.

DMC, which opened in 1954, serves mostly uninsured and underinsured patients, and has long been considered an important safety net for West County residents. It is the leading source of hospital care for the area's Medicare and Medi-Cal patients.

A recent county report said that if DMC closes, emergency room waiting times in the area would drastically increase.

The proposed parcel tax would expire and cease collection if DMC closes. The hospital employs nearly 1,000 workers.

Gideon said the parcel tax would make it more likely that the hospital could merge with a larger system. Talks with UC San Francisco Medical Center have been ongoing for months.

But this year, the parcel tax is a necessity, Gideon said, as the hospital continues to run huge deficits.

"The community that established this hospital is the community that has to save this hospital," Gideon said.

Only one member of the public spoke at Wednesday's meeting, and that person was opposes the tax.

"You can't continue to come back to try to raise money on the backs of business and homeowners," said Marilynne Mellander, a longtime El Sobrante resident.

The parcel tax would cost an owner of a 1,500-square-foot home about $210 annually, according to staff figures. Previous taxes passed in 2004 and 2011 pump $10.9 million annually into the hospital.

Leasing the parking lot to the casino would force workers and patients to park in other parts of the property, and off site. Gideon said free valet services would be available to patients.

DMC contains 25 of the 40 emergency room beds in West County, said County Supervisor John Gioia. A county report in 2011 said wait times and ambulance ride times would be drastically increased if the hospital closed.

"Even if you are a Kaiser patient, if you have a heart attack or a stroke, you come here," Gioia said.

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