Backwards Logic when it comes to Financing the Hospital
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We constantly hear we must secure the funding for this $2 billion project. Well actually by the hospital committee's own advertisement it is $2.1 billion. $1.7 billion for the hospital, $400 million for satellites, but what's a $100 million more or less? First of all, I ask why secure the funding for something that appears detrimental in 10 diffent ways.
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The question I ask of those saying: "secure the funding", is what funding? It is mostly borrowed money, and it is more like $2.6 billion.
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Perhaps they are talikng about the down payment due upon completion of the hospital, which is about $600 million judging by the almost identical Humber River hospital in Toronto. The Value for Money report on the $1.75 billion Humber River says $612 down and $53.9 million per year for 30 years. That comes out to $2.2 billion for the hospital alone.
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On top of $2.2 billion for the hospital we have to add $400 million for satellite services because the hospital is located away from where people live. That makes $2.6 billion.
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By the way, both Collingwood and the Muskokas are planning to build whole hospitals for $400 million. Why are we just getting buildings for a fraction of the services for that price. The satellites are nothing compared to a hospital and certainly shouldn't be considered an adequate replacement for the loss of a hospital.
On top if the eventual $2.6 billion, the poor location will require another $220 million for additional city infrastructure also to be maintained in future years by the city. It is hoped development around the hospital will pay for the infrastructure, but development from where in a city not growing? So the total eventual cost to taxpayers is $2.8 billion.
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Locally we are being asked to pay a "10%" tax levy which is $200 million, a fundraiser for $150 million for equipment, and the city will put up $220 million for infrastructure hoping to recover some of the costs. That's $570 million, about what I figure a new hospital sholud cost.
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In 2008 Perterborough built a fully equipped hospital for $285 million. The capacity was over 500 beds but they only build about half the floor space of our proposed monstrosity. So even at double the price, that would $570 million. Ironically the amount we will be paying locally, or just a bit less than the down payment paid by the province.
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No worries about securing the funding; the private partner seems more than willing to lend us the money as long as we are willing to pay an extra $2 billion in finance charges and 30 years maintenance. If the province won't pay the down payment, we can pay for it ourselves locally if they would let us build it our way, not the hospital committee's and province's way.
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Two replacement hospitals for the combined municipal and provincial costs of roughly $1.2 billion are possible, without additional financing and maintenance charges along with increased user fees through parking and food vending.