The fate of Children’s Hospital of Orange County’s $595 million expansion is now in the hands of the city of Orange.
But it could have a supporter in Mayor Carolyn Cavecche who sees the development as a way to maintain the city’s hospital hub reputation.
The city is now reviewing the seven-story project to make sure it meets city codes and requirements, said Debra Mathis, CHOC’s chief operating officer.
Hospital officials expect to go before the Orange City Council in March, said Walter Romero, CHOC’s vice president of construction.
If the council approves the project, construction is expected to start in September 2009, with expected completion three years later and the first patients coming in 2013. It would be a big boost for local builders who haven’t seen much commercial development of late.
Mayor Cavecche said she couldn’t specifically comment on the tower because it is still in the planning process and she wanted to be able to vote on it.
Cavecche did say the project fits into her vision of Orange being the county’s “medical hub.”
St. Joseph Hospital-Orange opened its patient tower last year, and UCI Medical Center is gearing up to open its New University Hospital in early 2009. Orange is also home to Chapman Medical Center.
“Besides bringing a large employee base, it helps us support other industries,” Cavecche said.
CHOC plans to pay for the project by borrowing about $150 million, getting $100 million from philanthropy and using funds from operations, Mathis said.
The hospital also will be able to tap up to $98 million in funding from Proposition 3, the bond initiative that California voters passed with 55% of the vote in last month’s election. Proposition 3 allows children’s hospitals to get the bond money either in a lump sum or stretched out for up to 10 years.
Proposition 3 grants come with a caveat: They “absolutely cannot be used for operating expenses. It’s all for construction or capitalized equipment,” said Diana Dooley, chief executive of the California Children’s Hospital Association, a Sacramento trade group that pushed for its
passage.
Dooley said she expects the first grants from the bond to be made through the California Health Facilities Financing Authority, a state agency that administers the program, in the early part of 2010. The state is now developing regulations for the grant.
CHOC also has $30 million in construction funds left from a similar bond passed in 2004.
FKP Architects of Houston designed the building. The Newport Beach office of St. Louis-based McCarthy Building Cos. is the general contractor.
Project Details
The project is going up on land at the corner of La Veta Avenue and Pepper Street. The Orange Medical Complex, which is currently on the space, will be demolished to make way for the tower.
Besides general medical-surgical beds, CHOC’s new tower will include a pediatric emergency department, operating rooms, a medical laboratory, pathology department and imaging and radiology services.
If approved, the tower will also help CHOC as it enters an affiliation with UC Irvine Healthcare and the UCI School of Medicine. That deal, announced about two weeks ago, calls for CHOC to provide inpatient and outpatient specialty care to children.
UCI Medical Center will continue to provide various services, including pediatric emergency services, neonatal intensive care, newborn nursery care and child and adolescent psychiatry.
In a release, both hospitals were careful to say they weren’t merging and that they would “retain their individual institutional identities.”
Part of CHOC’s identity is offering medical services to patients without top-notch insurance, which makes it in high demand.
The growing number of patients is what prompted the hospital to build the tower.
CHOC isn’t building its tower to meet California’s earthquake law, unlike other OC hospital construction projects. The hospital’s main building, which went up in 1991, meets seismic requirements, according to Mathis of CHOC.
Several other OC hospital projects are in varying stages of construction to address the seismic rules, which require all acute care facilities to meet certain construction standards in order to stay open.
UCI Medical Center’s New University Hospital has 482,428 square feet, 236 beds and 15 operating rooms holding $79 million worth of equipment.
UCI paid for New University Hospital from several sources. The university received $235 million from state bond money allocated in order to help it get its hospital in line with California’s earthquake safety law.
St. Jude Medical Center in Fullerton recently took possession of its $125 million, five-story patient tower, which is set to take its first patients in January. St. Jude, one of three local hospitals owned by St. Joseph Health System, an Orange-based nonprofit, is undergoing a $1.6 billion makeover to address both the earthquake law and a growing patient population.
