Lawrence Memorial Hospital is borrowing $1 million from itself in the wake of a lagging cash flow to avoid running out of money for salaries, supplies and other items.
According to the hospital's balance sheet for the end of March, the hospital had $423,664 in ready cash, a figure that should be closer to the $2 million range, LMH President and CEO Gene Meyer said.
Seven of the board's nine trustees voted for the $1 million transfer at their monthly board meeting Wednesday. Joe Harkins and Donna Osness were not present at the meeting.
The money will go from the "board restricted investments" account, which is a funded depreciation account. The hospital puts money in the account to pay for future capital needs based on how much the hospital's assets depreciate each month. There is about $10 million in the fund.
The terms of the loan call for 5 percent interest over 48 months.
LMH Chief Financial Officer Simon Scholtz recommended using the hospital's own money for the cash account instead of borrowing from a bank or other financial institution. Scholtz said the hospital should be able to pay itself back by the end of this year.
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