Proposed Land Sale Could Lead to Reopening of Closed Santa Paula Memorial Hospital
A Manhattan Beach homebuilder bid $13.1 million to purchase more than half of the 30-acre medical campus of bankrupt Santa Paula Memorial Hospital, advancing the possibility of reopening the facility, the Ventura County Star reports (Wilson, Ventura County Star, 11/16). The hospital closed in December 2003, and the hospital's board of trustees subsequently filed for Chapter 11 bankruptcy protection in federal court in Santa Barbara (California Healthline, 9/17).
In October, the Ventura County Board of Supervisors agreed to purchase the closed hospital through a deal with its creditors for $2.75 million. The county plans to merge the hospital with its own health care system, which includes Ventura County Medical Center and a network of health clinics. Officials estimate that it would cost less than $1 million in equipment and other purchases to resume operations at the facility (Griggs, Los Angeles Times, 11/17).
If Comstock Homes' bid for the land is approved, the hospital would have sufficient funds to repay its creditors, according to creditors' attorney Alan Stomel. "This is the final piece of the puzzle, and we are very satisfied with the result," Stomel said (Ventura County Star, 11/16).
The facility's 500 creditors are owed more than a combined $14 million, Stomel said (Los Angeles Times, 11/17). Stomel said he would submit Comstock's offer to U.S. Bankruptcy Court Judge Robin Riblet as part of a reorganization plan within the next 10 days.
The plan likely will not be approved by the court until late March, Stomel said (Ventura County Star, 11/16). The sale of the hospital to Ventura County also must be approved by Riblet, and government regulators must agree to allow the county to relicense the facility before either sale can be completed (Los Angeles Times, 11/17).
In addition, Comstock will complete its inspection of the land -- to ensure that it is not contaminated with toxic materials or home to endangered species -- by Feb. 10. The Santa Paula City Council also must approve a change in zoning of the land from institutional to residential use (Ventura County Star, 11/16).
The hospital board was scheduled to meet Tuesday to discuss the land sale and its own plan to lease the hospital to Pasadena-based Kare Healthcare (Los Angeles Times, 11/17).
Trustee Mike Kelley said Kare will have difficulty competing with the land sale offer. "They've got a known entity and sufficient cash to pay the creditors," he said (Ventura County Star, 11/16).
Ventura County Supervisor Kathy Long said the land sale agreement with Comstock "is another huge milestone" in officials' efforts to reopen the facility. She said she hopes to reopen the hospital's emergency department by spring (Los Angeles Times, 11/17).