Why was Garrard hospital debt allowed to grow to multimillion-dollar proportions

February 06, 2004

Dear Editor:

I think that the current situation the county (and we as taxpayers) find ourselves in as it relates to the now defunct local hospital and the lingering burdensome debt begs to be commented on by all taxpayers, especially those who work in Garrard County. Why was the debt allowed to grow to multimillion-dollar proportions on such a small facility before the hospital board or fiscal court got the message that maybe (just maybe) a small local hospital will not work any longer when faced with competition from regional hospitals (Danville) and the big hospitals just a short drive away in Lexington? Did it ever occur to them that in many cases the only people who utilize these small local hospitals are primarily people who can't or won't pay the hospital bill? I'm sure it's nice to say you have a local hospital and its emergency room could come in handy if you are hurt and you need temporary help until you can get to a real hospital, but these small facilities just won't work unless they have very honest, competent leadership who stay on top of billings to insurance companies, and especially to the state, which pays the bills for many of the people who can't pay.


Also, was the hospital audited by competent auditors who were not controlled by the hospital board? If so, were the findings of those audits ever made available to fiscal court and the taxpayers? And what about the so-called "investigation" that was supposed to have taken place after that former employee made those allegations last year? And finally, why not just default on the loan at this point? Or, have an attorney work out a reduced settlement on the debt with the lender. It's done all the time in the real world of business and if unsuccessful, let the lender seek recourse against whoever was in office at the time who committed the county to a debt that they knew could never be paid by the small, mismanaged, insolvent hospital.

All this gives the average taxpayer the impression that there was gross negligence, incompetence, and possibly even fraud at the hospital prior to its closing and that it is just going to be swept under the rug at this point and the few people who work in Garrard County are left to pay the tab through the oppressive 2 percent payroll tax.

I moved to Garrard County six years ago from Lexington (I'm originally from Lincoln County) because I thought the rural environment would be a better place to raise my small daughter away from the drugs, murders, and high taxes of larger cities. I should have done my homework better. Drugs are everywhere in this county, murder and violence are increasing, and property and payroll taxes are as high or higher than counties with large cities. At least in those counties you do at least get some basic level of service for your tax dollars.

And now, as a person who lives and works in Garrard County, I am being forced to hand over 2 percent of my gross earnings to pay a debt for a hospital I never used that should have been closed years ago. What could be more unfair? I, too, am not in favor of an even higher tax on insurance but even that would be more equitable than taxing workers' wages, many of whom don't even live in the county and like me, could have never gotten any benefit from the hospital.

Again, I say just stop making the hospital loan payments and try to work out a settlement with the lender. I don't care if some of the county officials are embarrassed by this course of action. Let the lender do whatever it feels it has to do. They should bear at least some of the burden for making such a large loan to a bankrupt hospital.

I applaud Joe Leavell as the only magistrate we have who seems to have any sense of judgment and fairness, especially when it comes to the payroll tax issue. Mr. Leavell has tried to get at least the 1 percent increase repealed but has so far not been successful.

For what it's worth, I am sending this letter to our county judge-executive and fiscal court members, and I would urge all taxpayers to send similar letters in protest of this debacle.

Paul Montgomery


Central Kentucky News Articles