MEMORANDUM

TO: Pete Sprague, Assembly President Kenai Peninsula Borough Assembly Members

THRU: Dale Bagley, Mayor

FROM: Scott Holt, Finance Director

DATE: April 8, 2004

SUBJECT: Ordinance 2003-19-47, An Ordinance appropriating $585,000 from the South Peninsula Hospital Service Area Fund Balance to provide supplemental funding to cover losses from operations of the South Peninsula Hospital

For fiscal year 2004, revenues generated at South Peninsula Hospital are coming in at a lower than expected amount due to lower than projected patient utilization of hospital services. Current projections indicate the hospital will sustain an operating loss of approximately $585,000.

The South Kenai Peninsula Hospital Service Area Board at its April 1, 2004 meeting authorized the transfer of $585,000 of service area funds to the hospital for supplemental funding. The service area has sufficient fund balance available to support this transfer and still be within the fund balance range as required by the fund balance policy.

A memo from the hospital with additional information will be provided to the assembly prior to the hearing on this ordinance.