MOSES LAKE — An updated analysis of the cost of building a new Samaritan Hospital could be presented at the July 25 commission meeting.

“(The project general contractor) is working on updating the guaranteed maximum price for the project, so we should see that sometime in July,” said Samaritan CEO Theresa Sullivan at the commission meeting Tuesday.

The guaranteed maximum price, or GMP, is the most the contractors can bill for the project and is also called a not-to-exceed contract. Graham Construction, the general contractor, provides the estimate to the hospital commissioners, who have the option to accept or reject it. Commissioners rejected a GMP proposal in July 2022.

Following that rejection, commissioners asked hospital district voters for a $130 million construction bond to help pay for the project, which was approved in April.

The project was first approved in 2018. Construction was scheduled to begin in summer 2020 but was put on hold with the arrival of the COVID-19 pandemic.

The project is being funded in part by a $136 million loan from the U.S. Department of Agriculture. Commissioners approved a resolution Tuesday authorizing hospital officials to accept the USDA conditions for the loan. Samaritan attorney Brad Berg said the idea was to speed up the financing process.

“Because we’re trying to move the financing along as quickly as possible, we’re a little concerned that we might get (the USDA approval) between meetings. So we thought it would be better to address that at the June (commission) meeting, even though we haven’t actually received the letters of condition yet,” Berg said.

The letters of condition confirm the USDA is ready to loan the money.

“It starts with the borrower submitting an application to USDA. The USDA reviews that application, then when they’re comfortable with it, they issue what’s referred to as letters of conditions, which are basically the loan terms,” Berg said.

Originally Samaritan officials planned to finance the project without a local construction bond, and its loan had been approved. Berg said the financing package changed once the bond was approved, and the USDA loan had to be reviewed as a result.

The resolution also authorized the approval of project financing proposals from a private lender.

“With respect to the direct loans provided by the USDA, they don’t provide those loans until construction is completed,” he said. “So the hospital needs to obtain interim financing while construction is being completed. And that interim loan would then be taken out with the direct loan provided by the USDA.”

Chief Administrative Officer Alex Town said the payback on the loans and bond would be about $12 million annually.

“Out of that $12 million, $7 million of it is covered by the bond (and) the other $5 million will be covered by the hospital. So that’s something that we’ll watch carefully, to make sure we meet that debt service coverage,” Town said.

Cheryl Schweizer can be reached via email at [email protected].