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Item No: 6B Meeting Date: February 27, 2017 Type of Business: Special Order of Business City of Mounds View Staff Report To: Honorable Mayor and City Council From: James Ericson, City Administrator Item Title/Subject: Presentation by the North Suburban Hospital District, represented by Board Chair Gerald Maeckelberg and General Counsel Scott Lepak, and Consideration of Resolution 8716, a Petition for Dissolution of the North Suburban Hospital District Introduction: North Suburban Hospital District Board Chair Gerald Maeckelberg and General Counsel Scott Lepak are planning a presentation for the City Council regarding the planned dissolution of the Hospital District. The Hospital District is asking the City to approve the attached resolution petitioning for the dissolution of the hospital district. Discussion: Due to Allina’s proposed merger of Unity and Mercy hospitals, the Hospital District Board discussed the changes and possible options at its public meetings beginning on April 13, 2016. It came to the conclusion that the consolidation prevents the Hospital District from spending tax money to fund capital improvements to the Unity campus going forward from the date these changes become effective. The Hospital District's authority to make improvements to Unity is subject to the public purpose doctrine. The Hospital District must make a determination that any expenditure of tax dollars has a public (rather than private) purpose and that such tax dollars are needed for the improvement to occur. With the consolidation of operations under the Mercy Hospital - Unity Campus concept, the Hospital District determined that the five member cities should not be required to pay for a Hospital that served a broader scope of individuals than a traditional stand-alone hospital focused on the care of the residents of those five cities. The consolidation of operations also made it difficult, if not impossible, for the Hospital District to establish that the tax dollars raised by the Hospital District were needed for a specific Unity project. On September 14, 2016, the Hospital District unanimously approved a resolution stating its intention to seek dissolution because Unity is no longer a full service community hospital, and therefore the Hospital District no longer has a public purpose to spend ad valorem tax dollars to fund capital improvement projects for the building.