At its meeting Tuesday night, the Wrangell Borough Assembly approved a proposed budget of nearly $29.4 million to build the new hospital.
The Assembly also approved the future installation of a low-slope roof on the new hospital, though Assembly members agreed it was not the preferred roof option.
The budget passed Tuesday night sits at nearly $1.8 million less than the current projected cost of building the hospital. That budget is, however, in the amount approved by the United States Department of Agriculture (USDA) last August. At that time, the federal agency awarded the city a $24 million loan to help build the hospital.
Wrangell Medical Center (WMC) Board President Mark Robinson, the sole WMC representative present at the meeting, asked the Assembly to approve a budget totaling just over $31 million, the estimated cost of the project.
Wrangell City Manager Timothy Rooney said it would not be responsible for the city to approve a budget that is over the total amount of funds available for the project. The city has requested the $1.8 million from the State in order to close that shortfall in funding, but those funds have not yet been approved.
“You don’t set your budget at your dream figure and start building towards that figure,” Rooney said. “Because when you get to the end, you’re going to be short and somebody is going to have to write a check. Who is going to write that check? I just don’t think that is a responsible way to move forward.”
The project’s funding shortfall also led the Assembly to vote in favor of a low-sloped roof for the future hospital. While Assembly members agreed a low-sloped roof was not the most desirable option, compared to a pitched roof with a more severe slant, it was the cheaper option.
The Assembly was presented with a pitched-roof option that is estimated to cost approximately $2.7 million more than the low-sloped roof. Rooney said while the pitched roof is preferred, the additional cost “does not make sense” for the hospital project that is already $1.8 million over budget.
Wrangell Mayor Jeremy Maxand said he was disappointed the Assembly had to make a decision that a lot of people, including himself, will not like. Originally, Maxand said, the city was told the new hospital would be a two-story building and have a pitched roof, among other building plans that have now changed.
“My feeling is this is not the hospital that the people of Wrangell deserve, but this is certainly the hospital that the people of Wrangell are going to get,” he said.
Maxand said he would be voting in favor of the low-sloped roof in order to move the hospital project forward.
Rooney explained to the Assembly that if they chose the more expensive, pitched-roof option, they would need to find funding for the additional cost, which would delay the hospital project from being put out to bid by contractors.
Wrangell has until June to act on its $24 million dollar loan from the USDA. If the hospital project has not been awarded to a contractor by then, Wrangell will lose that $24 million, Rooney said.
“It is a terribly tight schedule,” he said. “But it is the hand we have been dealt.”
The low-slope roof comes with a 20-year warranty. Maxand said he would be suggesting at a future Assembly meeting that money is annually taken from the hospital’s reserves to generate a pool of funding that guarantees “that on the 21st year, if that roof fails, there is enough money sitting aside to replace it.”
“We're not going to come back and wonder who is going to pay for that roof,” he said.
Though Assembly members expressed reservations about the low-sloped roof, the majority present Tuesday voted in favor. Assembly members Bill Privett and David Jack voted against approval of the roof.
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