MEMORANDUM

KENAI PENINSULA BOROUGH

FINANCE DEPARTMENT

To: Pete Sprague, Assembly President

Members, Kenai Borough Assembly

Thru: Dale Bagley, Mayor

From: Jeffrey Sinz, Finance Director

Date: March 20, 2003

Subject: Ordinance 2003-12, Asking South Peninsula Hospital Service Area Voters to Approve $17,000,000 in Hospital Capital Improvements and Authorize Issuance of Up To $10,500,000 in General Obligation Bonds To Partially Fund The Project

The attached ordinance if approved would ask service area voters to consider approving $17,000,000 in capital improvements to the South Peninsula Hospital and authorize issuance of up to $10,500,000 in general obligation bonds to partially fund the project. The balance of funding necessary to complete the project ($6,500,000) will be provided from hospital operating sources.

The capital improvement project has evolved over a period of several years and reflects work accomplished by the hospital's management, medical staff, the service area board, the non-profit board, and a consultant, Livingston Sloan, retained to assist with the planning process. Hospital representatives will be in attendance at the April 1, 2003 meeting to provide an overview of the project.

The hospital has requested that the issue be put before service area voters through a special election to be conducted on July 1, 2003. This would be in the form of a mail-out ballot that voters would receive in early June with mailed responses due by the July 1, 2003 election date. It is anticipated that the assembly would certify the results at the July 8, 2003 meeting. In order to facilitate this schedule, a shortened hearing is requested.