HOBOKEN - Mayor Dawn Zimmer is turning to the City Council and the taxpayers of Hoboken to help achieve a settlement in the bankruptcy proceedings of Hudson Healthcare Inc., the non-profit manager of Hoboken University Medical Center.
Before the sale of the city-owned hospital to HUMC Holdco, a group that also owns Bayonne Medical Center, can be completed, the claims must be settled. The potential new owners have said they would chip in $5 million for the settlement, according to sources.
Zimmer sent a memo to the City Council on Tuesday afternoon asking for approval of a bond ordinance for $5 million at the council meeting on Wednesday night.
Sources have said that the creditors asked for somewhere between $8 million and $10 million from the city in a meeting on Monday.
"Even if the full amount of this authorization were offered to the HHI Creditors Committee, there can be no assurance that they will accept a settlement on terms that can be achieved with this contribution," Zimmer said in her memo to the council.
Zimmer said to the council in her memo that if six members ( a super majority) do not vote for the bond ordinance, "then the hospital will be forced to close, most probably by the end of October." Zimmer currently has five allies on the council, meaning one other council member would have to vote for the ordinance.
If the hospital were to close, the taxpayers would be responsible for the $52 million bond guarantee, plus interest. The city voted to save the hospital in 2007 by guaranteeing bonds, and Zimmer has said she would like to sell the hospital to a private buyer who would keep the facility as a hospital.
For more on this story, keep reading HudsonReporter.com. - Ray Smith