Luzerne County Council to weigh in on Geisinger’s borrowing plan

Luzerne County Council is set to vote Tuesday on a resolution of support for Geisinger’s plan to borrow up to $1 billion to fund new health care facilities and equipment and possibly replace existing debt if interest rates are favorable.

Geisinger patients would benefit from the bond-funded enhancements in Atlantic County, New Jersey, and eight Pennsylvania counties, including Luzerne, a release said.

The health care system is asking officials in each of these counties to pass resolutions permitting the use of bond funds within their jurisdictions and acknowledging the bond issuance is desirable for the health, safety and welfare of their residents, the release said.

County government approvals are required for such health system revenue bonds under the Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA) and Municipal Authorities Act of 1945.

Counties providing requested approvals are not liable for any bond repayments or costs, officials stressed.

Any plans for the use of the bond funds also are subject to approval by the Geisinger Health Board of Directors and the Geisinger Authority, a corporation organized by Montour County Commissioners that will serve as a pass-through to pay the bondholders with receipts from Geisinger.

Geisinger currently maintains credit ratings of Aa3 with a stable outlook from Moody’s Investors Service and AA with a stable outlook from Standard & Poor’s Rating Services, it said.

Depending on the speed of county approvals and other regulatory requirements, the bonds should be issued in September or October, a Geisinger representative told council at a work session earlier this month.

The bond repayment term will be around 30 years.

Geisinger officials briefed council on the system’s impact in Luzerne County, including the following statistics:

• 4,521 Geisinger employees work within the county

• 4,827 county residents work for Geisinger

• Geisinger hospitals handled in-patient cases for 17,238 county residents in 2018

• More than 159,700 county residents were treated at Geisinger facilities in 2018, with individuals counted only once if they had multiple visits.

The Geisinger system also spent $463.6 million in the county in 2018, for an economic ripple effect of $808.9 million, a representative said.

New borrowing will allow investment in services that expand access to care and address some of the “key drivers of poor health outcomes in this area,” one of the representatives said.

Geisinger currently has 1.7 million square feet of clinical and office space in the county, including two hospitals, six primary care facilities and five specialty care offices, the representatives said.

The other Pennsylvania counties that must adopt resolutions: Centre, Columbia, Lackawanna, Lycoming, Mifflin, Montour and Northumberland.

A new multi-specialty clinic on Pierce Street in Kingston is part of a total 1.7 million square feet of clinical and office space Geisinger operates in Luzerne County, officials recently told county council in a discussion about the health care provider’s proposed new borrowing to fund additional projects.

https://www.timesleader.com/wp-content/uploads/2019/07/web1_KingstonInnovation1.jpg.optimal.jpgA new multi-specialty clinic on Pierce Street in Kingston is part of a total 1.7 million square feet of clinical and office space Geisinger operates in Luzerne County, officials recently told county council in a discussion about the health care provider’s proposed new borrowing to fund additional projects. File photo