Erlanger Health System's main financial panel cleared a business plan for replacing a decaying urban health center, which moves uninsured Chattanooga residents a step closer to a modern primary care facility.
But as two members of Erlanger's Budget and Finance Committee stressed, Monday's action represented only a baby step -- the panel merely approved taking construction estimates from outside developers for a new Southside Community Health Center.
Erlanger's full board of trustees must echo the committee Thursday before management can draft a request for proposals. The full board historically has followed the financial panel's lead on major projects.
Estimates for construction of the building run from $850,000 to $900,000, costs that the developer, not Erlanger, will cover.
For more than four decades, Southside has operated inside the decaying former Franklin Middle School, where more than 30,000 uninsured residents get clinical and dental care every year. Erlanger must act quickly because a $1-per-year rental agreement with the building's owner expires in May 2012, potentially exposing the public hospital to higher lease payments and structural repairs -- asbestos among them, officials said.
"Without decent facilities in an accessible market, there is no chance this program is going to succeed," said Jim Brexler, Erlanger's president and CEO.
That comment persuaded an initially skeptical panel to go along with a hospital business plan that estimates 15 annual lease payments of $137,020 for the eventual ownership of a new building at Ohls Avenue and 38th Street.
"There's some estimates in [the plan] that I don't necessarily question, but I would feel a whole lot better if the market was tested prior to us committing to the situation as it stands," Erlanger board of trustees Chairman Dan Quarles said.
Brexler and other top executives attempted to reassure Quarles, saying thorough "market analysis" made the estimates solid. Quarles pressed further, and Brexler said the bid process would reap more concrete numbers.
Before joining his fellow committee members in voting yes, Quarles again clarified that the resolution only opened the bid process and did not officially put the hospital on the hook for a new building.
But trustee and former Hamilton County Commissioner Richard Casavant soon questioned the project altogether, asking if "it's a good time to invest in brick and mortar."
"I think we could have more conversation about whether this is the right thing for Erlanger to do," he said, adding that trustees needed to "put our arms around the costs a little bit better" before committing full-throttle.