Good news for hospital project

After more than eight months of waiting, the Merrill Pioneer Community Hospital board of trustees received an important piece of news regarding the new hospital and clinic project. “I received an email from the LeMars office of the USDA saying, ‘Congratulations. Your loan has been approved and the funds are obligated to your project’,” said trustee president Jim Vander Woude. That email came Friday, Sept. 15.

The USDA approved allocating $17.75 million to the board of trustees for the completion of a new medical facility in Rock Rapids. The terms of the low-interest loan are for 25 years at 3.25 percent, according to Vander Woude. A groundbreaking ceremony at the project site was conducted Aug. 18 and construction began the same day.

For Vander Woude and the other board members, the notification was highly-anticipated. “We’re very excited and much relieved,” Vander Woude said of the news.

The board experienced an exercise in patience in the months following the filing of the application with the USDA. “We had to cope with a change in administration at the USDA,” explained Vander Woude. Representatives from the USDA’s area office in LeMars continually updated the board while they waited. In June, the group’s application passed the loan committee at the federal level without comment. “That was huge,” said Vander Woude of the critical step in the loan-approval process.

In the meantime, members of the Merrill Pioneer Community Hospital association voted to approve beginning construction without the USDA loan approval, something that still required USDA approval. “We were informed we would have to meet certain requirements, which we did,” said Vander Woude. “Major decisions were not made without notifying the USDA because we intend those expenses to be eligible for reimbursement in the $17.75 million allocated funds,” he explained. On July 25, the board accepted the project’s final plans for the architect and the guaranteed maximum price from the contractor. On Aug, 11, the board gave Journey Construction, contractor on the project, the notice to proceed.

The board of trustees secured a construction loan from several Lyon County banks, another necessary step in the process. Even with loan approval, the USDA does not provide funds on a project until it is complete. “They do not take a risk on a project that may not get completed or may not work,” said Vander Woude. The project owner is required to seek a construction loan to pay the contractor and the construction expenses that go with a project. Interest on that loan is an eligible reimbursement through the USDA loan. The banks behind the Merrill Pioneer Medical Facility construction loan include Frontier Bank, Peoples Bank, American State Bank and Premier Bank. “This project could not get off the ground without all of the funding sources, including the construction loan, the Forster Trust, improvements in kind, the capital campaign fundraising and the USDA loan,” said Vander Woude.

But it was the USDA loan that has solidified the project from a financial standpoint. “This project would not be economically-feasible without this USDA long-term, low-interest loan,” said Vander Woude. “Because of that, the community will be benefitting from a brand new, state-of-the-art, healthcare facility.”

“The USDA’s decision to approve a rural development loan request of $17.75 million for the construction of a new critical-access replacement hospital in Rock Rapids is terrific news, and I am pleased to have been a part of the effort to secure this needed funding,” said Congressman Steve King. “The new hospital will provide important health services not only to those living in Lyon County, but to residents of surrounding counties as well. I commend the board of trustees of Merrill Pioneer Community Hospital for their foresight, and look forward to the hospital opening its doors in 2019.”

A website continues to update the public on the progress of the new facility. According to Vander Woude, earthwork at the site is nearly complete and the gravel base under the floor of the building is completed. Currently the contractor is working on the underground infrastructure of the building and starting work on the perimeter footings of the building. Vertical steel work is scheduled to begin Nov. 1. “The public can follow the new happenings relative to the project on the website,,” said Vander Woude.

The board of trustees’ annual meeting will be scheduled for sometime in early November and will include a public informational meeting on the project and the upcoming capital campaign.

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