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Borough assembly releases attorney's PMC memo

 


The Petersburg Borough Assembly released Monday night an entire memorandum written by its borough attorney concerning the borough’s relationship with the Petersburg Medical Center that had previously been redacted.

The assembly released a redacted version two weeks ago after The Petersburg Pilot and KFSK submitted public record requests. The motion to release the entire document failed after two of the three assembly members, John Havrilek and Nancy Strand, voted against its release. The assembly then unanimously voted to pass a redacted version.

Ron Loesch, Petersburg Pilot Publisher, once again requested the assembly to release the entire document. Assembly member Kurt Wohlhueter, who wasn’t present at the initial meeting, voted to release the document, which swung the vote. Strand and Havrilek again voted against its release.

Much of the redacted memo compared PMC with the only other two publically owned hospitals in Southeast Alaska—Wrangell Medical Center and Sitka Community Hospital—and the corresponding relationship to their municipalities. It was also a response to some assembly member concerns related to PMC policy and management.

“…the Sitka and/or Wrangell Boroughs have greater involvement with hospital management and exert stronger control,” the memo states. “Whether to move in this direction is entirely within the judgment of the Assembly.”

According to the current borough charter, that’s the idea.

A portion of the attorney’s summary in the memo which was previously redacted reads, “…adoption of code changes imposing significantly greater Borough management/control might be challenged by the PMC board or others as being contrary to the Borough Charter provisions for the hospital board’s ‘greatest possible autonomy.’”

The attorney also advised that the two “greatest possible autonomy” clauses in the charter “may limit the extent to which code sections can be revised without an accompanying Charter amendment approved by a majority of the voters.”

During last week’s hospital board meeting, board president Tom Abbott questioned new language in the hospital’s annual audit report that defines PMC as a ‘component unit’—meaning PMC is a legally separate organization from the borough, but the borough is financially accountable.

“But the component unit language has connotation to it,” Abbott said. “And there is no financial relationship correct?”

“No,” Jeff Dowdy, auditor for BDO USA.

“Wouldn’t you think that should be included in the language then?” Abbott asked. “This language could lead further down the road to a muddy relationship.”

But the borough attorney believes there is a financial relationship—if the hospital were to incur debt and not pay it, the borough would end up responsible.

“That’s an issue,” Borough Manager Steve Giesbrecht said. “That’s where the assembly comes from, from the standpoint of wanting to be more in the loop.”

The PMC board has managed the hospital autonomously since its creation in the 1920s. But it has recently requested financial assistance from the borough.

“A lot of folks I report to are saying, ‘if the hospital’s going to ask for money then we’re going to want to make sure they’re using the money that they’ve got wisely and we want more control’,” Giesbrecht said.

The bulk of the earlier redacted content is the borough attorney’s opinion on whether or not the assembly should claim PMC staff as borough employees.

“I do not think it is presently in the Borough’s interest to publicly assert or deny that PMC staff are Borough employees,” the attorney’s memo states. “…Under Borough code section 3.50.070, the PMC Board has authority ‘to employ’ an administrator, physicians, surgeons, advisers, accountants, consultants, attorneys ‘and any other medical care providers or professionals,’ and to determine the ranges of salary, wages and benefits of these.”

The attorney stated the “paramount concern” is employer liability for personal injury or death, which may be blamed on negligent hospital care—meaning the borough would likely be involved in a lawsuit and could be held liable.

The borough assembly and the hospital board will meet early January during a joint work session to discuss these and other issues.

 

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