Montco to borrow to pay its bills until tax receipts arrive

Posted: February 22, 2014

NORRISTOWN As the sale of the county-owned Parkhouse nursing home stretches weeks beyond its intended closing date, Montgomery County faces hundreds of thousands of dollars in costs it had hoped to avoid.

The county expected to have a $35 million check for Parkhouse by the end of 2013, money that would float the county's expenses in the first quarter of 2014.

Without that check, the commissioners voted Thursday to borrow $9.75 million to pay its bills until tax receipts begin arriving in March.

The amount of the Tax Revenue Anticipation Note approved Thursday is a fraction of what was borrowed in previous years, and Commissioners Chairman Josh Shapiro emphasized that "this is not a budget-related issue. It's a cash-flow issue."

The short-term loan will cost the county $10,000 in interest and $31,000 in fees, said the county finance director, Uri Monson.

County officials said the delays were unrelated to a county controller's report that found an ethical violation by a Parkhouse doctor who was investing in the real estate deal. The doctor was fired Wednesday, but the report found no legal reason to halt the sale in Upper Providence Township.

Although inspections and minor repairs are taking longer than expected, the commissioners said they were a normal part of the due-diligence process. The deadline was extended to Jan. 31, Feb. 13, and now March 6.

In the intervening time, Parkhouse payroll and operating expenses cost the county about $50,000 a week, Monson said.

The county has also paid nearly $15,000 in extra repairs and engineering reports as part of the negotiations.


jparks@philly.com

610-313-8117 @JS_Parks

www.inquirer.com/MontcoMemo

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