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John Howell Column

John Howell Sr.

City’s help to hospital possible in other forms

On these pages last week was published a commentary that singled out U. S. Bankruptcy Judge David Houston as the best hope to protect this community’s interest in keeping viable, ongoing hospital care at Tri-Lakes Medical Center.

Those lines were written before city officials met many minutes in executive session last Tuesday as assistant City Attorney Colmon Mitchell discussed with them the request by hospital chief restructuring officer Michael Morgan that they not respond to a motion by UPS Capital that the city and county claims for almost $2 million in property taxes be disallowed.

Morgan and Tri-Lakes Chief Administrative Officer Vince Brummett were accompanied by dozens of hospital employees interested in keeping the facility open. The $2 million in property taxes has been described as a “deal breaker” as a bidder moves forward, attempting to buy the hospital in a section 363 sale under the bankruptcy code.

The trouble is, according to the legal minds hired by both the city and county to advise Batesville’s mayor and aldermen and the Panola County Board of Supervisors, the elected officials — aldermen and supervisors — cannot legally “forgive” taxes that have already been assessed and levied.

They can — and should — give the hospital, assuming that a successful purchase with a for-profit corporation buyer is consummated, the same consideration that it gives local industry. Most local industry receives an exemption of all city and county real estate taxes except school taxes as incentive for locating in Panola County and hiring workers here.

But before that can happen the immediate issue of the $2 million in back taxes must be resolved, and it appears that state law restricts what supervisors and aldermen can do.

Judge Houston has presided over the case for almost two years of bankruptcy operation, balancing the need for creditors to be paid with Panola County’s need for a hospital to be in operation for its citizens. The question of land taxes as a deal breaker further compounds his conundrum as does a motion filed last week by UPS Capital to void tax sales in 2007 and 2008 by the Panola Chancery Clerk of two parcels of the hospital property.

The load of balancing the interest of Panola County citizens with those of the hospital’s creditors has grown considerably heavier on Judge Houston’s shoulders during the last week.