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Rx for MetroSouthTuesday, December 15, 2009 Chicago Tribune by Chicago Tribune editorial staff Last year, a New York-based investment group took a risk: It rescued St. Francis Hospital in Blue Island
from oblivion. The new owners -- led by Transition Healthcare LLC --
changed the hospital's name to MetroSouth Medical Center. They promised
to revive the hospital by being more nimble and responsive than the
competition.
The hospital has opened new clinics in the area
and expanded access to care. But it has also struggled; it laid off 10
percent of its employees in September.
Dr. Enrique Beckmann,
the CEO of MetroSouth, says the hospital is only "breaking even" in its
operating budget. And that doesn't include the millions it has invested
in upgrades and new neighborhood clinics.
So MetroSouth wants Cook County
to cut its property tax bill by 60 percent. That tax break could save
the hospital an estimated $1 million a year for the next decade.
Cook County Board member Joan Patricia Murphy, D-Crestwood, co-sponsored a narrowly written measure that would pinpoint MetroSouth (and perhaps one other hospital, Weiss Memorial in Chicago's Uptown neighborhood) for a tax break. She says it is "truly important" for the region.
The
board is scheduled to consider the proposal Tuesday, but Murphy told us
Monday that she'll defer the proposal so the county, the hospital and
Blue Island officials can work out details.
The County Board should ditch this tax break.
Don't get us wrong: We we'd like to see MetroSouth thrive. The Blue Island area needs a good hospital.
But
this is special-interest legislation. It would give this hospital an
advantage over any competing for-profit hospital that doesn't get a tax
break.
Murphy is seeking a very generous reading of a tax
incentive program that has been run by the county since 1978. That
program is designed to lure industrial and commercial development in
struggling communities, according to the Cook County assessor's office. There's supposed to be a "but for" test -- that is, but for the tax incentive, a business would not locate and hire here.
That's not the case with this hospital. Transition Healthcare made the decision to buy and run the facility.
There
are a lot of distressed hospitals in the Chicago area and around the
state. The Illinois Hospital Association estimates that more than 30
percent of the state's hospitals are losing money.
Transition is
a for-profit company that took on a faltering hospital. It knew the
risks and potential. Like every company, it needs to find a way to run
a lean, efficient, profitable operation. It has not justified a special
tax break from the County Board.
If the county doesn't go along
with the tax break, Beckmann says, the hospital will "have to revisit
every budget item and find ways to offset the higher costs of the real
estate tax."
A lot of companies are going through the very same thing.
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