ARKANSAS CITY, Kan. (KSNW) – Arkansas City officials are hopeful that money from a sales tax can help their hospital, which has been struggling financially.
The city voted in May to add a one-cent sales tax, on top of the half-cent one they put in place in 2009.
However, because of a potential conflict with state law, a judge had to rule if it could be put into place.
City officials say they can move forward with that one-cent sales tax because it is strictly designated to help pay off the South Central Kansas Medical Centers debt.
Louise Smith has lived in Ark City for more than 20 years.
She says at times she has had to utilize the EMS services the hospital provides.
Smith calls paying more in sales tax is a necessary evil.
“If that is the necessary way to take care of our hospital, otherwise it was going to be a raise in property taxes,” said Smith.
The new South Central Kansas Medical Center opened in 2011, at a cost of around 28 million dollars to build the new facility.
City Commissioner Dan Jurkovich says the hospital has had problems making bond payments to pay off that debt.
“Three times they’ve needed to borrow somewhere around 1.2 million dollars, currently the revenue the hospital brings in, actually the earnings aren’t enough,” said Jurkovich.
Jurkovich says the one-cent sales tax won’t completely wipe away the hospitals financial woes
However, he says it should generate around 1.5 million dollars a year to help the hospital turn things around.
“It’s likely if the sales tax can start-up in October, between the two sales tax and the revenue of the hospital, there should be enough to pay for the debt payments,” said Jurkovich.
It’s something residents, like Smith, say is necessary.
“It is vital for jobs, it is vital for care in case of an emergency,” said Smith.
Jurkovich says since the hospital has had trouble making its payments that they are bringing in a consultant.
The hope being they can also look at various options, issues and the overall operation of the hospital.