By Myrna Trauntvein
Times-News Correspondent
Juab County Commissioners adopted and signed a resolution
allowing Central Valley Medical Center to bond for up to
$6.5 million to construct the new hospital facility now
being constructed on Nephi's Main Street.
The bonds, and the exchange of funds, will be
finalized in Salt Lake City on Feb. 8. Commissioners were
invited to attend that meeting.
The non-profit organization constructing the new
facility, as such, qualifies for the tax-exempt bonds.
However, the only entities which can issue tax-exempt bonds
are governmental entities, said Carl Empy, direct purchaser
for Zion's Bank.
"Zion's Bank has purchased the bonds as part of their
investment portfolio," said Empy.
David Leavitt, county attorney, stressed that all
bonding documents would state that the bonds were to be used
by the non-profit organization running the hospital for
construction of a new facility. "That needs to be made
clear," he said.
"The county is the issuer of the bonds but with
strictly stated governing rules," said Brent Davis,
representing hospital management. "The county re-loans the
proceeds of the bond to the hospital for construction of the
facility."
All documents make it known, and are supported by law,
that the county has no responsibility fore repayment. A
strict loan agreement is drawn up, said Davis, that makes it
impossible for the county to ever have any responsibility
for repayment of the bonds.
"The county's only purpose is to serve as issuer of
the bonds," said Davis. "That is because, by law, only
governmental entities can issue tax exempt bonds even though
the hospital is a non-profit, tax-exempt organization."
Robert Steele, commissioner, said when he was mayor of
Nephi, the city served as issuer of bonds on a few
occasions. They had never been compelled nor required to
make repayment for any of those bonds.
"There are no obligations on the part of the county to
repay these bonds," he said.
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