Prince George’s County Executive Jack Johnson testified at a state Senate committee hearing Wednesday against a bill that could force the county to raise property taxes to pay off at least $100 million in debt from its hospital system.
“They’d be asking county residents to bear the burden of years of mismanagement by Dimensions,” Johnson spokesman John Erzen told The Examiner.
Dimensions Healthcare operates the county-owned Prince George’s Hospital system. “There is no free lunch,” said Prince George’s Del. Doyle Niemann, the bill’s initial sponsor.
Originally, Niemann had said Dimensions long-term debt and unfunded pension liability was $150 million, but on Wednesday he put the number between $100 million and $120 million.
Niemann’s bill, which the House has passed, would create a governor-appointed board that could issue revenue bonds to pay off the debt. Technically, the tax increase would be mandated to pay off the bonds.
The county’s general property tax rate is 96 cents per $100 of assessed value. According to a legislative services note on the bill, the tax is at the maximum allowed by its charter, but the legislation permits a supplemental tax not subject to the cap. Initially, Niemann’s bill did not allow for a tax increase.
To those residents who might oppose the bill, Niemann asked, “Do you want to be able to go to the hospital, any hospital? Because if the Dimensions system closes, as they have said they will do if we do not come up with an answer, every hospital in the [county] is likely to be in danger.”
Niemann said the bill also requires the board to negotiate with Dimensions for its property, lease or operating rights and to look for a new owner, among other things.
Erzen confirmed the county has reached an understanding with Lanham-based Doctors Community Hospital System to take over ownership and operations of Prince George’s Hospital system.
The $370 million plan would be paid for through a “combination of county and state money,” according to Erzen, who said the state opposes it because of concerns about the request for offers process.
