Forecast: Funds for new Junction City psych facility cloudy

By Saul Hubbard, The (Eugene) Register-Guard, Feb. 22, 2012

A fitting collaboration for a prison-like hospital.  (Image:  OSH Replacement Project website)

A fitting collaboration for a prison-like hospital. (Image: OSH Replacement Project website)

SALEM — As the monthlong 2012 legislative session enters the home stretch, the fate of continued construction funding for the proposed new state psychiatric hospital in Junction City remains unclear.

To keep the project moving through next June and the 174-bed hospital on track to open in early 2015, lawmakers this session need to allocate $29 million in general fund-backed bonds, according to project administrator Jodie Jones.

If lawmakers are to approve some or all of that, the effort probably would originate in the capital construction subcommittee of the Joint Ways and Means Committee, the Legislature’s budgeting arm.

The subcommittee, which has yet to meet publicly this session, features the presiding officers of each legislative chamber — Senate President Peter Courtney, a Salem Democrat, and House Co-Speakers Bruce Hanna, a Roseburg Republican, and Arnie Roblan, a Coos Bay Democrat — and often convenes as adjournment approaches to move key spending bills forward.

But, with the state’s borrowing capacity severely limited for the rest of the 2011-2013 biennium, legislative leaders are keeping silent for now about which projects — if any — might be green lit and how much funding they could receive.

Aside from the Junction City hospital, which has a total remaining price tag of $84 million, some key projects competing for state capital dollars include:

A “sustainability center” in Portland. The 7-story tower near Portland State University would be built to feature the latest in environmentally friendly and energy-efficiency construction and would contain government offices, conference rooms, and lecture halls. Project backers are seeking $40 million in state bonds.

Continued funding for the O­regon eCourt system, which would allow the state’s courts to go “paperless” and make all filings electronically by 2015. Supporters of the long-term project, which has already received state funding, are seeking $13.7 million in general fund-backed bonds this year.

A variety of smaller-scale projects at Oregon’s 17 community colleges, costs of which would total $9.6 million in lottery fund-backed bonds. The projects include $1 million for new LCC classrooms.

Increased funding for Connect­Oregon, which provides grants for transportation work. A proposal to allocate $10 million in bonds could boost the program’s funding from $40 million to $50 million for the 2011-2013 biennium.

A $10 million loan program to fund water and sewer work in Oregon cities. The state has spent millions of dollars installing infrastructure for the Junction City hospital site, but has not begun construction of the hospital buildings.

After a report by the state’s debt commission in January that recommended no increase in general fund-backed debt and only minimal increases in lottery fund-backed debt for “the most critical” projects until the end of the 2011-2013 biennium, some lawmakers — Republicans in particular — are gun-shy about new construction spending this year.

Rep. Dennis Richardson, a Central Point Republican and the GOP’s chief budget crafter, said Tuesday during a House floor speech that the Legislature should “guard” its small remaining lottery bond capacity “very carefully.”

“We cannot continue to incur additional debt without being willing to pay the consequences,” he said. “When we bond additional money that means we’re committing, not just our Legislature, but Legislatures for the next 20 to 25 years to make the debt payments. … We pay for it by not being able to fund programs in the future.”

Richardson’s comments were directed at an attempt by House Democrats to tack on $29.6 million in lottery bonds to an existing and largely unrelated bill, Senate Bill 1544. The allocation would provide the funding for the community college projects, the water and sewer infrastructure loan program, and the additional $10 million for Connect­Oregon.

Rep. Dave Hunt, a Gladstone Democrat, said the appropriations have “broad bipartisan” support but have been blocked from advancing by House Republican leadership. “What better time to issue lottery bonds than when interest rates are low, we have infrastructure projects ready to go, and our work force is hungry,” he said

Attaching the bond funding to SB 1544 allows these “important, job creating” projects to move forward now, said Jared Mason-Gere, a spokesman for the House Democrats, thereby circumventing the capital construction subcommittee.

The proposals “have been hanging out there for a while, and they’re ready to go,” he said.

But the add-on, which would require a majority vote in the House, is a long shot in the evenly-divided chamber.

“It’s more or less a political stunt that will have no bearing on the adjournment of the session,” said House Republican spokesman Nick Smith. “We have a process for bonding projects.”

The House will vote on the bonding add-on tomorrow.

Another obstacle to pushing through funding for construction projects this year is that more than $1 billion in bonding capacity — general fund and lottery fund combined — will open up at the start of the next biennium, according to the debt commission’s report.

But, for the Junction City hospital, delayed funding would make it “extremely difficult” to finish building by early 2015, Linda Hammond, director of Oregon’s addictions and mental health treatment programs, said last month.

Rep. Val Hoyle, a Eugene Democrat whose district includes Junction City, said Tuesday that the decision about hospital funding this year is now in the hands of legislative leadership.

While she acknowledged “the need for the Legislature to work within its means,” Hoyle said she believes the hospital project is “truly critical.”

Whether or not the project is funded, Hoyle said she will “fight to ensure that the conversation focuses on the full spectrum of mental health care that is needed for … (the) severely mentally-ill population.”