HILLSDALE — Hillsdale Hospital secured a $25.8 million loan from the U.S. Department of Agriculture’s Rural Development program Thursday morning, which will be used to pay off existing hospital debt.
Duke Anderson, Hillsdale Hospital president and CEO said a majority of the hospital’s debt was derived from the addition of the Birthing Center and John “Jack” MacRitchie North Unit, the renovations of the “Mac” McGuire Skilled Nursing Facility, along with the new operating rooms.
Anderson said the hospital’s administration looked into an USDA loan before new construction began in 2012, but there was no money available at the time.
In wanting to meet the needs of the community the board of directors went ahead with the addition and renovation selling bonds for the project.
“We looked at it heavily at that time,” he said. “We always had it in the back of our mind that we wanted to work with the USDA.
“This will allow us to have a more predictable interest rate on the loan,” he added.
The 30 year loan is at an interest rate of 2.375 percent.
He said one of the bonds the board of directors was concerned about had a large “balloon” payment in 2023.
“We view the USDA’s willingness to loan us this money as an indication that USDA believes that small, rural hospitals, and this hospital in particular, perform a vital role in the economic development and redevelopment of rural areas,” Anderson said.
Since starting the process in June the hospital administration has worked closely with B.J. Haire, USDA specialist.
“This is a great benefit for a rural hospital,” Haire said. “We were glad we could help.”
Haire worked closely with Shelley Aronson, the hospital’s financial advisor on the project.
Jeremiah Hodshire, director of organizational development at Hillsdale Hospital said the USDA has been very kind to the hospital over the years.
“They have always worked very well with us,” he said.
Anderson said he would like to recognize the significant contributions made by Haire, Aronson, Hodshire and Valerie Fetters in securing the loan.