Funding recommended for four rural Arkansas hospitals

Panel OKs relief for rural facilities

A legislative panel on Tuesday advanced the state Department of Human Services' requests for federal American Rescue Plan funds totaling about $12.5 million to provide emergency aid relief to hospitals in Dumas, Eureka Springs, Magnolia and Piggott.

The Legislative Council's Performance Evaluation and Expenditure Review Subcommittee recommended that the Legislative Council approve the Department of Human Services' requests for $4.5 million for Eureka Springs Hospital; $3.4 million for Piggott Community Hospital; $2.6 million for Delta Memorial Hospital in Dumas; and $1.9 million for Magnolia Regional Medical Center. The council will consider taking final action on the requests on Friday.

The panel also recommended the council approve the state Department of Finance and Administration's request to grant Black River Technical College authority to spend $4.7 million in American Rescue Plan funds to construct a 60-student barracks at the Law Enforcement Training Academy in Pocahontas.

The U.S. Treasury Department awarded $4.7 million in American Rescue Plan funds directly to the state Department of Finance and Administration and the department transferred the funding to Black River Technical College, Arkansas Finance Department spokesman Scott Hardin said afterward.

The construction of a 60-bed student barracks "would allow the academy to increase their class size for the basic training as well as host more advanced classes for local law enforcement," Black River Technical College President Martin Eggensperger wrote in a letter dated Oct. 24 to state Department of Finance and Administration Secretary Jim Hudson.

In March 2021, President Joe Biden signed the $1.9 trillion American Rescue Plan Act that is designed to help the United States recover from the economic and health effects of the covid-19 pandemic.

Arkansas was awarded $1.57 billion in American Rescue Plan state fiscal recovery funds, and the unallocated balance will decline to $327.7 million if the Legislative Council approves the requests for the four hospitals and Black River Technical College, Hardin said.

The state Department of Human Services said the American Rescue Plan funds for the hospitals in Dumas, Eureka Springs, Magnolia and Piggott are aimed at assisting hospitals to offset extraordinary costs related to mitigating and preventing covid-19, and retaining and acquiring frontline staff as a result of the covid-19 pandemic.

The Eureka Springs Hospital is a 15 licensed-bed critical access hospital that plans to convert to a rural emergency hospital, according to state finance department consultant Alvarez & Marshall Public Sector Services.

State Sen. Missy Irvin, R-Mountain View, asked Eureka Springs Hospital officials about the status of the conversion of the hospital to a rural emergency hospital.

Angie Shaw, chief executive officer of Eureka Springs Hospital, said the hospital has been a critical access hospital for several years, and "health care in Eureka Springs has changed and looking at the past 18 months it has shifted more for us from our inpatient utilization towards more of our emergency services and outpatient services, so this designation definitely caught our eye.

"We are already operating more or less as a rural emergency hospital, and it was just going through the process," she said. "We definitely have the support of our community and our city officials and so far it has been a good experience. I wasn't sure what to expect from the community and our leaders and they understand how we are operating currently and we have moved forward with this process."

Shaw said the rural emergency hospital designation will improve the hospital's financial health.

The Magnolia Regional Medical Center is a 49 licensed-bed general hospital and its challenges have centered around staff recruitment and retention, according to Alvarez & Marshall Public Sector Services.

The Delta Memorial Hospital is a 25 licensed-bed critical access hospital in Dumas and its operating margin and cash flow have been negatively affected by difficult collections, recruiting and retention challenges and competition by other nearby health care facilities, according to Alvarez & Marshall Public Sector Services.

The Piggott Community Hospital is a 25-licensed-bed critical access hospital and has faced an extremely limited cash position, reporting having only 13 days of cash on hand as of Aug. 31, according to Alvarez & Marshall Public Sector Services.


The legislative panel also endorsed the state Department of Public Safety's request for $10 million in state restricted reserve funds, but decided hold the Department of Public Safety's request for $500,000 in state restricted reserve funds until the Legislative Council meeting.

The $10 million would allow the Department of Public Safety's Division of Arkansas State Crime Lab to enter into contract with a design professional and allow for any incidentals for the beginning stage of construction of a new state crime lab facility, Department of Public Safety Chief Fiscal Officer Karen Perry said in a letter dated Nov. 1 to Hudson.

The $500,000 in restricted reserve funds would allow the Department of Public Safety to provide grant funding "To support physical security enhancements and other security activities for nonprofit organizations that are at high risk of a terrorist attack based on the organization's ideology or mission," Department of Public Safety Secretary Mike Hagar said in a letter dated Nov. 2 to Hudson.

In response to a question from state Sen. Scott Flippo, R-Mountain Home, about some details, Perry said that Gov. Sarah Huckabee Sanders "promised to aid the Jewish community during the recent rise of anti-Semitic rhetoric crime and this will allow funds for [the Department of Public Safety] to provide grant funding to support security enhancements for nonprofit organizations."

The grants could go to any nonprofit group, he said.

Flippo asked whether one nonprofit could apply for the entire $500,000 in grant funding or whether there is a limitation on the funds applied for by organizations.

Perry said, "We are still working on the grant program itself, but we'll just see how many apply and what they apply for and then we'll just make a determination from there on how much funding is available for each organization."

Flippo questioned what happens if only one group applies for a grant and whether the group would get the entire $500,000.

Perry said "I guess it would depend on how much they apply for."

State Rep. Mark Berry, R-Ozark, called it "a very broad request," and he questioned whether the grant money could go to provide security for doors.

Perry responded that the money "could be for any upgrades to the facility for security, maybe security cameras or for extra security guards or protection."

Berry said it's not "really appropriate" to provide state funds to improve the infrastructure for a nonprofit group.

"Now if we are going to provide armed manned security by the Department of Public Safety in some respect, I can see that," he said.

Both Flippo and Berry said they want more information about this proposed grant program.

State Sen. Gary Stubblefield, R-Branch, asked whether there is any ideology that would disqualify a nonprofit group from receiving these grant funds.

In response, Perry said, "No."

Irvin said that "there are all kinds of organizations with all different types of ideologies that could meet this threshold, and I personally am not comfortable with approving this at this point" in the absence of an emergency.

"This is super open ended," Irvin added. "It's first come first serve. It is not structured. There is no achievable goal for a grant program here. We don't know what we are doing. We don't know the threshold of high risk. ... We need to restructure this a lot better before you bring it before us to have it approved in my opinion."