The Wrangell Borough Assembly voted Wednesday to set $500,000 aside for Wrangell Medical Center to borrow in case it runs out of cash.
The assembly chose this agreement instead of approving the hospital’s original request to seek a line of credit from a bank or financial institution.
For the hospital to access the line of credit from the borough, the hospital CEO would have to get approval from the borough manager. The hospital would then have a monthly reporting requirement to update the borough on how that money is being used. There is no interest on the line of credit and no time limit for paying the money back.
Assembly Member Julie Decker said the agreement should be structured more like a line of credit rather than a loan or a gift.
“I don’t want to make it cumbersome, but it’s a normal thing for a bank to have an annual renewal of a working line of credit. So I don’t think that that’s cumbersome,” Decker said. “And I’d like to set it up with that kind of thing. It would just require coming back to the assembly to approve for another year and making sure terms are met.”
The assembly approved this amendment, so the hospital will have to renew the agreement with the borough assembly each year.
Wrangell Medical Center CEO Marla Sanger said the hospital is in a better financial position than expected.
“The potential for us needing to use the money is less, but that’s not to say we would never use it,” Sanger said. “It does improve our nimbleness as an organization, and I think it’s valuable for that. So I would really urge you to approve it.”
Sanger assured the assembly that if the hospital uses the line of credit, paying the borough back will be the organization’s first priority.
The assembly has the right to revoke this agreement at any time.
